Recent updates under the EU EMIR Refit, UK EMIR Refit, and
the ASIC and MAS Rewrite frameworks have introduced stricter trade reporting
obligations. Market participants must adjust their agreements with liquidity
providers to comply with the new requirements.
Automated UTI Assignment Systems Help Mitigate
Discrepancies
A primary focus is the Unique Transaction Identifier (UTI).
The regulatory
regimes mandate that both parties to a trade submit identical UTIs in their
transaction reports. The responsibility for UTI generation should be clarified
in trading agreements or separate bilateral documents.
Jurisdictions
like MAS expect counterparties to establish internal policies governing the
UTI creation process. Automated systems for UTI assignment can help mitigate
discrepancies, particularly for high-volume trading relationships.
Consistent Reporting of Key Fields Under Scrutiny
Pairing and matching processes are also under scrutiny.
Counterparties must ensure consistent reporting of key fields such as UTI,
ISIN, transaction direction, and execution venue. Clear protocols should be in
place to resolve mismatches, with designated contact points on both sides.
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— REGnosys (@REGnosys) January 15, 2025
Although ASIC does not
enforce report matching, its adherence to the IOSCO UTI waterfall increases the
likelihood of alignment efforts by Australian Derivative Trade Repositories
(ADTRs).
Document UPI Sharing Mechanisms for Regulatory Clarity
Delegated reporting arrangements require additional
provisions. Reporting
delegates, such as TRAction, should be authorized to contact both parties
to rectify discrepancies before submission. Pre-submission checks can identify
potential mismatches, helping counterparties avoid regulatory breaches.
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— Kaizen (@kaizenreporting) August 7, 2024
Legal Entity Identifier (LEI) renewals are another critical
requirement. Regulators reject trades involving lapsed LEIs in EMIR and MiFIR reports,
necessitating resubmission after renewal. Timely LEI updates are essential to
maintain uninterrupted reporting. However, the obligation does not apply to
counterparty 2 under ASIC and MAS rules.
Unique Product Identifier (UPI) sharing mechanisms should be
documented, with one party designated to obtain UPIs from the ANNA DSB library.
Written agreements can provide operational clarity and demonstrate compliance
during regulatory reviews.
New ASIC Rules Require Regular Checks for SSR
The ASIC Rewrite introduces changes to single-sided
reporting (SSR) from October 2025. Alternative reporting arrangements will no
longer apply, and only ADTRs will qualify for SSR relief. Counterparties must
conduct regular checks on trades reported on their behalf to meet eligibility
requirements.
Market participants should review their delegated reporting
agreements and internal systems to align with the updated regulations.
Collateral reporting obligations under the ASIC Rewrite, including the
reporting of collateral received, also require consideration.
This article was written by Quinn Perrott at www.financemagnates.com.
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