EMIR and MiFID II Disclosures
European Market Infrastructure Regulation (“EMIR”)
EMIR came into force on 16 August 2012. As part of the regulation, the two principal concerns that regulators sought to address in respect to the protection of clients’ positions and collateral at an EEA central counterparty that has been authorised under EMIR (“EU CCP”) are:
- to ensure that clients can successfully transfer positions away from a defaulting clearing member to a non-defaulting clearing member
- to ensure that in effecting any such transfer, any collateral associated with such positions is transferred to such non-defaulting clearing member alongside such positions, with the aim of mitigating the risk that clients:
- i. have to double collateralise their positions during the transfer period
- ii. may suffer a loss in respect of the collateral that they had posted to their defaulting clearing member.
EMIR requires that EU CCPs and their clearing members:
- Offer clients the choice between omnibus client segregation and individual client segregation under Article 39;
- Publicly disclose the levels of protection and costs associated with different levels of segregation; and
- Disclose the prices and fees associated with the clearing services they provide
The Markets in Financial Instruments Regulation (”MiFIR”) and Markets in Financial Instruments Directive (“MiFID”) (together, “MiFID II”)
MiFID II places additional obligations on Clearing Members and their clients (“Direct Clients”) with respect to the indirect clearing of Exchange Traded Derivatives (“ETDs”) activity cleared at EU CCPs.
An indirect clearing arrangement arises when there are more than three participants in the transactional chain, for example: CCP, Clearing Member, Direct Client and Indirect Client.
When providing indirect clearing services, Clearing Members and Direct Clients must do so on reasonable commercial terms and publicly disclose the general terms and conditions under which it provides those services.
Fees & Charges
Please click on the links below for details of the client clearing fees and charges that apply where we are providing clearing services at EU CCPs: