EMIR Newsflash: ESAs publish final draft of EU margin rules for uncleared OTC derivatives

The European Supervisory Authorities published on 08 March 2016 the much anticipated final draft of the regulatory technical standards (RTS) on risk mitigation techniques for OTC derivative contracts not cleared by a CCP.

The phase-in of the final margin rules remains broadly unchanged (ie 01 September 2016 or 01 March 2017 for variation margin, and a staggered four year phase-in from 01 September 2016 to 01 September 2020 for initial margin). However, the final RTS includes new extended phase-in periods for certain FX contracts and single-stock equity options and index options to take account of definitional uncertainty in relation to the former, pending the finalisation of MiFID2, and to avoid regulatory arbitrage in the case of the latter.