Regulatory Reporting

In order to make OTC trading of financial derivatives more transparent and ease the process of uncovering systemic risks, the EU legislature adopted the “European Market Infrastructure Regulation” (EMIR) in July 2012.

EMIR requires every market participant to report all derivatives to a trade repository, regardless whether these are OTC or exchange traded. The trade repository is an entity that is authorised to collect all records of OTC derivative trades.  The ESMA was given the task to put the legislation into action. All market participants who either trade or clear such derivatives must report to said repository. Entities affected by this legislation are Central Counterparties, as well as participants of the financial sector and any trading participants who are not attributed to the financial sector. Participants are able to delegate this reporting obligation to counterparties or other third parties. Both OTC derivative transactions that include clearing obligations and non-clearing obligations are to be reported.

The report has to include information concerning counterparties, product-type, trade details, clearing and evaluation of the underlying collateral. Furthermore, the European reporting obligation includes relevant changes during the lifecycle of any trade. The report must be issued one work-day after the trade (t+1) at the latest.

This reporting obligation came into effect on 12.02.2014 for OTC derivatives as well as listed derivatives.

There are six global providers of the ESMA registered in Europe today.

  • DTCC GTR – the largest clearing-organization worldwide.
  • REGIS-TR – a joint-venture of the Spanish iberclear and Clearstreams.
  • UnaVista – is a subsidiary of the London Stock Exchange and the third largest transaction-registry in Europe. UnaVista also offers services for MiFID, AIFMD and others.
    targit has extensive documentation about these providers, as well as a test-environment in which the transactions and various product and message-types can be uploaded.

 

In Switzerland the financial market infrastructure also developed a transaction repository for derivative transactions. This came into force at the beginning of 2016. In this regard SIX acts as a central transaction repository in cooperation with Swiss banks. targit GmbH already has a solution -tecconTR- that is adapted to FinfraG, which can be used as an automated solution for large users, as well as software as a service-solution for users with a low volume of transactions that require registration.

targit GmbH offers the following services for the connection of transaction registers:

Know How / Consultancy package of targit for transactions repository:

• targit GmbH is up to date on the legal finalisation and technical developments put forth by ESMA
• targit GmbH is in close contact with DTCC, Deutsche Börse and REGIST-TR and has access  to documents and test-systems
• targit GmbH has successfully connected several clients to the trade repository DTCC, Deutsche Börse and REGIS-TR

Therefore targit GmbH can provide support for the following

• reporting in accordance with the current guidelines, as well as the reporting process / Lifecycle
• Data mapping DTCC GTR or REGIS-TR
• Management of the identifiers LEI and UTI
• Technical connection of the trade repository