European Securities and Markets Authority Outlines Derivatives Reporting Obligations in the Event of a No-Deal Brexit

The European Securities and Markets Authority has published a statement on the impact of a hard Brexit on the reporting obligation under the EU European Market Infrastructure Regulation. The statement considers the following counterparty scenarios: (i) EU27-EU27; (ii) EU27-U.K.; (iii) U.K.-EU27; and (iv) U.K.-U.K. The statement clarifies the position should the U.K. leave the EU without a deal and without a transition period, including reporting by CCPs and counterparties; reconciliation and recordkeeping by trade repositories, access by EU27 authorities to reported data and portability and aggregation by trade repositories. ESMA's statement clarifies that:

• to continue to comply with their reporting obligation, EU27 counterparties and CCPs should report their derivatives to an EU-recognized or registered trade repository;
• U.K. counterparties are not expected to report to an EU trade repository on or after March 29, 2019, including derivatives rejected as of March 29, 2019 and amendments to derivatives concluded before March 29, 2019;
• EU27 counterparties and CCPs should consider any risks if they delegate their report submissions to a non-EU entity; and
• U.K. trade repositories should ensure the full transfer of all data to an EU27 trade repository before March 29, 2019.

View ESMA's statement.

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