EMIR reporting services

The European Market Infrastructure Regulation (EMIR) aims to mitigate systemic risks and enhance the integrity of the derivatives market concerning over-the-counter (OTC) derivatives, central counterparties and trade repositories. TMF Group can help you with EMIR compliance.

Consequences of EMIR

EMIR affects all European Union and many non-EU entities, including financial institutions (FI), Special Purpose Vehicles (SPVs) and any company that enters into any derivative, whether hedging against interest rates or foreign exchange risk, for trading purposes, or to gain exposure to certain assets as part of an investment strategy. TMF Group can help any EMIR-qualifying company to report all its derivative contracts to a trade depository, plus assist with implementing EMIR risk management standards.

How we help you with your company’s EMIR related obligations

TMF Group can help mitigate your company’s risk by adhering to the administration obligations that have to be implemented and take care of all the concerns around the reporting to a trade repository (TR).

We monitor the regulations closely, including the requirements for reporting of all derivative contracts and implementation of risk management standards, thereby reducing the counterparty and operational risk for all parties involved in a derivative transaction.

We report on the identification of derivatives to the repository, so that all information can be matched and validated. After the initial matching, any differences are reconciled.

We support the continuing obligation to monitor and upload any changes to derivatives that need to be reported on, along with the required data entry into the repository on your company’s behalf, helping you to stay compliant with all local regulations.

EMIR obligations, classifications and qualifiers

A company that qualifies for EMIR must:

  1. Report all derivative contracts it enters into, in a trade depository
  2. Implement risk management standards in line with EMIR (operational and margining processes) with regards to bilateral OTC derivatives (even when the trades a company does, might not be cleared by a central counterparty)
  3. All OTC derivatives are subject to a mandatory clearing obligation to facilitate the review of the transaction
  4. If a derivative transaction is done by a company or person outside of the European Economic Area (EEA) but the counterparty is within the EEA, the European leg must be reported.

Companies need to determine in which qualification category they fall when determining their EMIR (reporting) obligations. There are three categories:

  • Financial counterparties (FC)
  • Non-financial counterparties below certain thresholds (NFC-)
  • Non-financial counterparties above certain thresholds (NFC+).

FC classification: All banks, insurance/assurance/reinsurance companies, alternative investment funds managed by alternative investment fund managers, investment firms, UCITS and pension funds.

Non-FCs: These include all individuals who trade for commercial purposes, and are considered NFCs with thresholds that determine whether a trading party is an NFC+ or NFC-:

  • €1bn for credit and equity derivatives (gross notional amounts)
  • €3bn for IR, FX and all other derivatives (gross notional amounts)
  • OTC derivatives position is calculated as a rolling average over 30 working days
  • OTC transactions entered into with the purpose of hedge do not count towards the notional amounts.

NFCs below these thresholds are considered NFC- while NFCs above these thresholds are considered NFC+.

More information

Interested in our EMIR services or have any questions? Please fill in our ‘Make an enquiry’ form today, with details of your EMIR request and we’ll get in touch.

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