The EMIR regulation (European Market Infrastructure Regulation) gradually imposes requirements on all types and sizes of entities that enter into derivative contracts with the aim of improving transparency and reducing the risks related to the derivatives market.
Overall, the regulation introduces four types of obligations on parties to derivatives trades:
- Trade reporting obligation
- Clearing obligation
- Risk mitigation techniques
The following entities are covered by the different provisions in EMIR:
- Financial Counterparties (FC): most financial institutions
FC’s are divided into those who exceed a clearing threshold under EMIR or do not make the mandatory annual calculations (FC+) and those who fall below these thresholds (FC- or Small Financial Counterparties (SFC))
- Non-Financial Counterparties (NFC): undertakings that are not FC’s
NFC’s are divided into those who exceed a clearing threshold under EMIR (NFC+) and those who fall below these thresholds (NFC-). For more information about the clearing thresholds, please see our FAQ.
Individuals are not subject to specific requirements according to EMIR.
|Type||Trade reporting obligation||Risk mitigation obligations||Clearing obligation||Collateralisation|
|FC+ or NFC+||X||X||X||X|
|NFC-||X||(Requirements are generally less onerous than for FC and NFC+)|
The following exemptions applt to the obligations in EMIR
|Clearing Obligation (EMIR Article 4)||Exchange of Collateral||Reporting obligation|
|Pension scheme arrangements||Exempt*, until 18 June 2021||No exemption||No exemption|
|Intra-group transactions||Exenpt (subject to a decision from a competent authority)||Exempt (subject to a decision from a competent authority)||No exemption|
*hedging (risk coverage) transactions
Danske Bank Group makes use of the exemption from the margin requirements:
Exemption from margin requirements
Your reporting obligations explained
The EMIR regulation requires that both parties to a derivatives trade must report details of the trade to a trade repository. A trade repository is an entity that centrally collects details about derivatives trades in a register to which financial regulators have access for supervision purposes.
The reporting obligation covers both OTC trades and exchange-traded derivatives (ETD), for instance futures, and cleared as well as non-cleared transactions.
The reporting obligation applies to all parties registered in an EU/EEA-country – except private individuals, central banks and some public bodies.
You can report your derivatives trades yourself or delegate the task to your trade counterparty or a third party.
We can help you meet the obligations
Danske Bank offers a trade reporting service to help you meet your reporting obligations. By signing up for this service, you authorise Danske Bank to report – on your behalf – all trades between you and Danske Bank, including our subsidiaries within the EU/EEA, to a trade repository.
In order for us to help you with the reporting, you must acquire a Legal Entity Identifier (LEI) for your company and inform us about it. Please go to the page about LEIs to find more information about LEIs and how you can obtain one.
Danske Bank will report your trades to DTCC GTR (Depository Trust & Clearing Corporation – Global Trade Repository). You can find more information on our trade reporting service in the FAQ (PDF).
Trade reporting service
Sign up for Danske Bank's Trade Reporting Service here