Classification tool simplifies EMIR compliance

The buy-side is now able to use an EMIR Counterparty Classification Tool to facilitate compliance with European market infrastructure regulation requirements.

By None

The buy-side is now able to use an EMIR Counterparty Classification Tool to facilitate compliance with European market infrastructure regulation requirements.

The International Swaps and Derivatives Association (ISDA), the British Bankers Association, the Investment Management Association (IMA) and Markit today launched the online system on ISDA Amend, part of Markit’s Counterparty Management platform.

Adrian Hood, regulatory advisor at the IMA, said the buy-side will be able to enter a client’s categorisation, specifying if it is a financial counterparty, a non-financial counterparty or whether it has an exception under EMIR.

New EMIR rules require OTC derivatives to be centrally cleared and reported to a trade repository. 

“Every time an asset manager wants to do an OTC derivatives trade for one of those clients they have tell the sell-side once again all the required information for clearing and settlement purposes,” Hood said. “ISDA Amend will provide all that information at their finger tips.” 

The service is free for buy-side, and many asset managers have already expressed plans to enter clients’ details into the system, Hood said.

ISDA and Markit launched ISDA Amend in August 2012 to automate the information gathering process and sharing of data to counterparties required by both EMIR and the US’ Dodd-Frank Act. 

“The associations responded to market demand to broaden the reach to enable clients to classify themselves according to the EMIR taxonomy and together produced the new EMIR Counterparty Classification Tool,” David Geen, ISDA’s general counsel, said.

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