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ARTICLE · 15 MAY 2017

EMIR Collateral Margin Reform

ELVINGER HOSS PRUSSEN, société anonyme
Explore more from ELVINGER HOSS PRUSSEN, société anonyme

Under EMIR and as part of the obligation to use risk-mitigation techniques, financial counterparties (including most investment funds) and large non-financial counterparties are required to exchange...

LuxembourgFinance and Banking
Elvinger Hoss Prussen
Elvinger Hoss Prussen

Under EMIR and as part of the obligation to use risk-mitigation techniques, financial counterparties (including most investment funds) and large non-financial counterparties are required to exchange collateral where OTC derivatives are not centrally cleared.

In December 2016, the EU regulatory technical standards (Commission Delegated Regulation 2016/2251) supplementing EMIR with regard to the risk-mitigation techniques applicable to non-centrally cleared OTC derivatives ("Margin RTS") were published in the Official Journal of the EU.

The Margin RTS specify the various procedures that counterparties must include in their risk management procedure. They also set out the methodology to be used for calculating initial and variation margins as well as the eligibility and diversification criteria with which they have to comply.

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