EMIR technical standards. At the heart of this friction is the ‘flexibility’ of rules for non- financial counterparties (NFCs) and how these will actually apply in practice, an issue we have written about before. formal review will take place, resulting in major setbacks for the EU‘s (and the globe’s) post- trade agenda. The true results of rushed consultations and ignorance of the advice of the industry are now being felt.
This has some serious implications.
This is the latest in a series of frictional encounters between those writing the policies and those writing the standards. A similar situation occurred in Q2 last year when the EC‘s draft supplementing rules to implement the AIFMD differed strongly from ESMA‘s advice, leaving the industry in limbo as to what the final implementing rules would actually mean to them. There is no reason to believe this relationship will improve any time soon.
That exactly this means for firms is still unclear. There are some powerful forces at play, with the European Parliament now looking to take a more active role in implementable regulation, suggesting EMIR will most certainly not be the only rule returning to the drawing board. Views are divided on whether this is a help or hindrance to the industry, but it does offer a rare opportunity to get this right on the second pass.
The biggest unknown is regarding timelines. If any rules are rejected and delayed, what happens to the schedules for the remaining rules? And, if more consultation processes are underway, what happens to other, related, progress made on EMIR?
Recommended Further Reading: