ESMA Publishes Draft Technical Standards and Consultation on Clearing

The European Securities and Markets Authority published a final report on draft regulatory technical standards ("RTS") relating to the clearing of interest rate swaps under EMIR, as well as a consultation paper on the clearing of foreign exchange ("FX") non-deliverable forwards under EMIR.

The draft RTS report provides, among other things:

• an explanation of the procedural aspects of the clearing obligation;
• clarifications of the structure of the classes of OTC derivatives that are proposed for the clearing obligation;
• an outline of the determination of the interest rate classes of OTC derivatives that should be subject to mandatory clearing;
• the approach for the definition of the categories of counterparties; and
• an explanation of the approach considered for frontloading and a definition of the minimum remaining maturities of the contracts subject to it.

The consultation paper also provides an explanation of how the draft RTS establishes a clearing obligation on a class of FX non-deliverable forward OTC derivatives under EMIR. Comments on the consultation paper are due by November 6, 2014.

See: Draft Regulatory Standards on Clearing Obligation Final Report; Consultation Paper on Clearing Obligation.