As part of the EMIR review, AMAFI teamed up with France’s Banking Federation, the FBF (AMAFI / 23-66), to highlight three critical issues for European participants: repatriation of clearing to the EU (cf. p.6 Newsletter n°50), the clearing obligations of UK pension funds and margin requirements for equity options.

Under domestic regulations, UK pension funds are not subject to a clearing requirement for derivatives transactions. The European Commission previously granted an EMIR exemption to European firms so that they could trade on a level footing with UK pension funds, but that authorisation expired in June. With EMIR 3.0 proposing to do away with the obligation, a way must now be found to extend the exemption until the new regulation comes into application.

A similar issue affects the margin requirements for OTC equity options. Here again, EMIR 3.0 proposes to do away with this obligation. An exemption is in place until January 2024 and will need to be extended until the regulation enters into application.

Among the steps taken by AMAFI, a delegation led by Stéphane Giordano broached these two topics with Jennifer Robertson, head of DG FISMA's Market Infrastructures Unit. While Ms Robertson said that she understood the competitiveness challenges for the industry, she also pointed out that the Commission had limited means of action, including in terms of legal remedies, hence the need for the co-legislators to ratify their respective positions as swiftly as possible. AMAFI will nevertheless continue to work on these issues.