Given that most end-users of swaps have already complied with the March 2013 ISDA protocol (DF 2.0 protocol) and that the CFTC has found: that certain requirements of the DF exchange documentation rules are comparable to obligations and CMAs, many financial counterparties (CCP) or SDs offer end-users a bilateral agreement that will “reload” their DF 2.0 protocols on compliance with EMIR and RMT obligations. These bilateral agreements with CS or SDs can be an effective way for end-users to meet EMIR`s commitments and CMAs. The extension agreement is intended to allow counterparties who have already entered into a voting, dispute resolution and disclosure protocol on the EMIR 2013 portfolio to comply with their requirements under the FMIA. By entering into such an endorsement, which is a bilateral agreement as opposed to the underlying protocol, the parties agree to include the voting and dispute resolution provisions in the IMFA portfolio and/or a confidentiality clause to report under the FMIA under the 2013 EMIR Portfolio Reconciliation, Dispute Resolution and Disclosure ACCORD ON THE IEM PORTEFEUILLE. The ISDA 2013 EMIR Portfolio Reconciliation, Dispute Resolution and Disclosure Protocol (EMIR Protocol) allows end-users to modify their ISDA master agreements to meet the emir portfolio voting and dispute resolution obligations. By complying with the EMIR protocol, end-users agree in writing to the implementation of the portfolio settlement and the processes and procedures necessary to evaluate dispute resolution procedures. The EMIR protocol also provides an exemption from disclosure to ensure that end-users can meet their reporting and registration obligations under the EMIR Regulation, without violating applicable confidentiality or confidentiality agreements. However, given the complexity of EU data protection legislation, end-users should be aware that waiver declarations, consents and confirmations in the protocol are not necessarily sufficient to overcome any prohibition or impediment to disclosure under the law of each EU jurisdiction. Click on the link for our end-user update swaps to EMIR thought obligations.
The main advantage of using such a high-level agreement for counterparties who have already complied with a 2013 EMIR Portfolio Reconciliation Protocol, Resolution and Disclosure Protocol, is to maintain processes that meet the requirements of the FMIA. Counterparties may also consider concluding the IMFA agreement published by the Swiss Banking Association, which provides for a portfolio voting procedure, a dispute resolution procedure and an exchange of confirmations in accordance with the rules of the FMIA. In addition, unlike the ISDA documentation, the FMIA agreement provides for a self-classification letter that can be used by all counterparties for the classification itself. However, we find that at this stage, none of these agreements are attacking margin rules. Finally, some large companies have developed ad hoc documentation to define IMFA procedures that apply exclusively to their relationship with a given counterparty. This documentation is usually tailor-made. The counterparties enter into, if available, legally binding agreements containing all the terms of any derivative contract, by way of over-the-counter, electronically, as quickly as possible, but within a specific time frame. Until August 31, 2014, an NFC must make confirmations on interest rate and credit rate derivatives within three business days and from maturity.
