Report on the international treatment of central banks and public entities managing public debt with regard to OTC derivatives transactions

Summary:

Report presented on 30 January 2019 by the European Commission assessing the regulation governing OTC derivatives, central counterparties and trade repositories in the light of the United Kingdom’s withdrawal from the European Union.

Further information:

The European Market Infrastructure Regulation (EMIR) requires the central clearing of all standardised OTC derivatives contracts, the reporting of all derivatives contracts to trade repositories and the implementation of risk-mitigation techniques for those trades which are not centrally cleared.

According to Article 1(4) of EMIR, the Union’s central banks and public bodies charged with or intervening in the management of the public debt are exempted from EMIR and are therefore not subject to these obligations.

The current assessment is triggered by the United Kingdom’s notification of its intention to withdraw from the Union. When Union law ceases to apply to and in the United Kingdom, the exemption in Article 1(4)(a) of EMIR will no longer apply to the United Kingdom central bank or public debt management bodies.