The EMIR 3.0 debate is set to see its end in Q2 this year, after the European Parliament draws out the final text. From the first version, EMIR 1.0, introduced in 2012, to the EMIR Refit of 2019, then EMIR 2.2 of 2020, and UK EMIR after Brexit, keeping up with the changes would have been a challenge for anyone. In a recently published article, Global Regulation Tomorrow outlines 10 of the more important tenets of the current EMIR version.
Mentioned first and foremost is the “most controversial” issue in the EMIR 3.0 debate – the requirement for counterparties to hold an active clearing account with an EU CCP. Despite criticisms from industry heavyweights, the requirement has gone through. In addition, counterparties are required to clear at least five trades in certain categories of in-scope derivatives contracts within a pre-determined reference period.
Some opponents of the active clearing account requirement have questioned its effectiveness in funnelling trade back into the EU. To encourage more clearing in the bloc, a requirement in EMIR 3.0 obliges clearing members and clients who provide clearing services at both an EU CCP and a third-country CCP to share information with their clients about clearing at the EU CCP.
Other requirements highlighted in the article include the exemption of intragroup transactions from the clearing obligation and margin requirements, the authorisation of CCPs to provide clearing services and activities in non-financial instruments, and the encouragement for EU public authorities to clear at EU CCPs.