Text as of 17 Jan 2025 · Consolidated version of 24 December 2024 · Same wording as today’s text.Today’s text
Article 4b — Post-trade risk reduction services
Financial services★Level 1RegulationEMIRIn forceIn force on the date shown, by the dates in the Official Journal.·VerifiedIdentical to the official source.·Official source
1.Without prejudice to risk-mitigation techniques under Article 11, the clearing obligation referred to in Article 4(1) shall not apply to an OTC derivative contract that is initiated and concluded as the result of an eligible post-trade risk reduction (‘PTRR’) exercise (‘PTRR transaction’) carried out pursuant to paragraphs 2 to 4 of this Article.
(a)the entity performing the PTRR exercise (‘PTRR service provider’) complies with the requirements set out under paragraphs 3 and 4 of this Article; and
(a)be performed by an entity authorised in accordance with Article 7 of the Directive 2014/65/EU that is independent of the counterparties to the OTC derivative contracts included in the PTRR exercise;
(c)be accepted in full and, as a result, the participants in the PTRR exercise shall not be able to choose which trades to execute under the PTRR exercise;
(a)comply with the pre-agreed rules of the PTRR exercise, including methods and algorithms in prescheduled cycles, and act in a reasonable, transparent and non-discriminatory manner;
(f)monitor the transactions resulting from the PTRR exercise in order to ensure, to the extent possible, that the PTRR exercise does not result in any misuse or circumvention of the clearing obligation.
5.The competent authority which has authorised the PTRR service provider in accordance with Article 7 of Directive 2014/65/EU shall, before a PTRR transaction resulting from a PTRR exercise performed by that PTRR service provider is able to be exempted from the clearing obligation in accordance with paragraph 1, do the following without undue delay:
The competent authority referred to in the first subparagraph shall, at least on an annual basis, confirm to ESMA that the PTRR service provider continues to comply with the requirements referred to in paragraphs 3 and 4 or that the PTRR service provider is no longer providing PTRR services, as applicable.
ESMA shall transmit the information received under the first and second subparagraphs of this paragraph to the authorities of each Member State with supervisory powers in relation to the clearing obligation referred to in Article 4(1).
The competent authority referred to in the first subparagraph of this paragraph shall, without undue delay, notify ESMA where a PTRR service provider no longer complies with the requirements referred to in paragraphs 3 and 4. Upon such notification, ESMA shall remove the PTRR service provider from the list referred to in the fifth subparagraph of this paragraph. From the date when the PTRR service provider has been removed from that list, PTRR transactions resulting from a PTRR exercise performed by that PTRR service provider shall no longer be exempted from the clearing obligation in accordance with paragraph 1.
ESMA shall, on a yearly basis, publish a list of PTRR service providers notified to ESMA under the first subparagraph, point (a).
6.ESMA shall develop draft regulatory technical standards to further specify the elements and requirements set out in paragraphs 3 and 4 and the following other conditions or characteristics of PTRR exercises:
(c)the possible inclusion of mixed portfolios containing both cleared and uncleared transactions in the same PTRR exercise and the conditions under which such inclusion would be allowed;
ESMA shall submit the draft regulatory technical standards referred to in the first subparagraph to the Commission by 25 December 2025.
Power is delegated to the Commission to supplement this Regulation by adopting the regulatory technical standards referred to in the first subparagraph of this paragraph in accordance with Articles 10 to 14 of Regulation (EU) No 1095/2010.