FIA Europe Clarifies Scope of EMIR Article 39 following LCH.Clearnet EMIR Authorization (with Lofchie Comment)

The Futures Industry Association ("FIA") of Europe issued an interpretation, based on FIA's discussions with the UK Financial Conduct Authority, of the scope of EMIR Article 39 following the LCH.Clearnet Limited EMIR authorization, which came into effect on June 12, 2014.

The interpretation explains the scope of:

• the application of EMIR Article 39 with respect to the non-EU clients of clearing members;
• the application of EMIR Article 39 with respect to EU clients that are also U.S. persons; and
• the Article 39(7) disclosure document relating to U.S. clearing members of EU clearing counterparties.

Lofchie Comment: The interpretation reflects ongoing difficulties that U.S. and EU regulators are having with the application of their rules to cross-border transactions.

See: FIA Press Release. Related news: CFTC Issues Two Extensions of No-Action Relief to LCH and Nodal (CFTC Letters 14-38 and 14-39) (March 27, 2014); SEC Extends No-Action Relief to ICE Clear Credit LLC, LCH.Clearnet, and CME (December 27, 2013).