Proposal For EMIR Reform – Targeted Changes With Important Consequences For AIFS, AIFMS And UCITS Management Companies

Background to EMIR Reform

On 4 May 2017, the European Commission (the "Commission") published its proposal to amend the European Market Infrastructure Regulation ("EMIR"). As readers will be aware, EMIR is the centrepiece of the legislation introduced in the aftermath of the financial crisis and was introduced with ambition of making financial markets safer and more stable. In particular, EMIR seeks to reduce risks to the financial system arising from the entering into of derivatives transactions. EMIR aims to achieve its stated objectives by increasing the transparency of the over-the-counter (OTC) derivatives market and also to mitigate counterparty credit risk and

reduce the operational risk associated with OTC derivatives.