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In this act Article 1 of 42

Article 1 — Definitions

Financial servicesLevel 2RTSEMIRIn forceOfficial source

For the purposes of this Regulation, the following definitions apply:

1(1)
(1)‘initial margin’ means the collateral collected by a counterparty to cover its current and potential future exposure in the interval between the last collection of margin and the liquidation of positions or hedging of market risk following a default of the other counterparty;
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1(2)
(2)‘variation margin’ means the collateral collected by a counterparty to reflect the results of the daily marking-to-market or marking-to-model of outstanding contracts referred to in Article 11(2) of Regulation (EU) No 648/2012;
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1(3)
(3)‘netting set’ means a set of non-centrally cleared over-the-counter (‘OTC’) derivative contracts between two counterparties that is subject to a legally enforceable bilateral netting agreement.
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