Emir's unanswered questions

Author: | Published: 24 Apr 2014

The European Market Infrastructure Regulation is causing confusion around the question of which instruments and agreements the new framework is designed to capture

At the September 2009 summit in Pittsburgh, G20 leaders agreed that all standardised over-the-counter (OTC) derivative contracts should be cleared through central counterparties by the end of 2012 at the latest, and that most derivative contracts should be reported to trade repositories. The EU's response to this commitment is the regulation on OTC derivatives, central counterparties and trade repositories (commonly referred to as the European Market Infrastructure Regulation, or Emir).

The policy aims of Emir were ambitious: to bring within the scope of regulatory scrutiny ahuge range of financial instruments which hitherto had been constrained only by the legal obligations owed between counterparties. The incredibly wide scope of Emir means that market participants who had never been subject to any degree of financial regulation before are now...