CySEC, the financial regulator in Cyprus, has recently written this letter to local market participants, reminding them of their obligations under EMIR. This includes a reminder of the reporting obligation, not only that market participants must report, but also that those who delegate reporting to others are still “on the hook” for reporting under EMIR. Market participants are to return a form to CySEC advising to where data is being reported and confirming that other requirements are met.
This article by Chris Dingley of Abide Financial on the LeapRate web site reviews the letter and reminds that a “fire and forget” trade reporting policy is not to be advised. Two years after EMIR reporting came into effect, regulators are now making sure that market participants are adhering to the rules.
The new Regulatory Technical Standards(RTS) for EMIR reporting, likely to come into force later this year, are intended to address the low the reconciliation rates of data reported, making it very difficult for regulators to read. The US has also seen quality issues with data reported to Swaps Data Repositories (SDR) under the Dodd Frank Act. In December, the CFTC issued this document outlining proposed changes. This article by Tod Skarecky of Clarus FT considers these changes, and suggests that they are only the next step in a long road to making the data useful.
In the energy trading world, there is currently a focus on the second phase of REMIT reporting, which starts on 7th April. The developments in EMIR should remind us that the requirements will continue to evolve, and thus require effort and attention, for several years to come.