The EMIR Refit guidelines, finalised by ESMA in October 2023 and effective from 29 April 2024, represent a substantial shift in the way derivatives must be reported across the EU. Designed to enhance data quality, promote standardisation, and improve systemic risk oversight, these guidelines mark a turning point in regulatory compliance under the European Market Infrastructure Regulation. In this article, we explore six key aspects of the EMIR Refit guidelines, what they mean for financial and non-financial counterparties, and how firms can prepare effectively.
1. EMIR Refit Guidelines Now Enforce Updated Reporting Standards
The EMIR Refit guidelines introduce harmonised technical standards (RTS and ITS) that significantly affect how firms report over-the-counter (OTC) and exchange-traded derivatives. All reports submitted from 29 April 2024 onwards must conform to these new rules. Firms are expected to update existing derivatives within 180 days of this date. Failure to comply may result in data rejection by trade repositories (TRs), impacting regulatory reporting obligations.
Why it matters: These changes emphasise accuracy and completeness in trade data, enforcing a shift from fragmented national approaches to a consistent pan-EU standard. Firms must ensure internal systems and delegated reporting arrangements align with the updated EMIR Refit guidelines.
2. Delegated Reporting Responsibilities Are Redefined
Under the EMIR Refit guidelines, the allocation of reporting responsibility has changed. Financial counterparties (FCs) must report on behalf of smaller non-financial counterparties (NFC-) unless the latter opts out. Delegation remains possible, but with clearly defined obligations.
What this means for you: Firms must review delegation agreements to avoid duplications or omissions. The EMIR Refit guidelines make clear that counterparties are responsible for ensuring data integrity, regardless of delegation.
3. Complex Derivative Structures Now Have Clearer Reporting Paths
The EMIR Refit guidelines provide detailed instructions on how to report complex derivative instruments, including FX swaps, swaptions, crypto-asset derivatives, and contracts involving multiple legs.
Practical tip: Review your trade booking and reporting logic to ensure it aligns with the new expectations. For example, FX swaps should be reported as a single contract, not as two linked trades.
4. Enhanced Data Reconciliation and UTI Management
Data reconciliation under the EMIR Refit guidelines will be stricter, including mandatory fields and better-defined linking rules using Unique Transaction Identifiers (UTIs). Reporting entities must coordinate to ensure UTIs are shared and reported consistently.
Risk to manage: Mismatched UTIs or reconciliation failures could lead to TR rejections and supervisory follow-ups. Establish UTI generation and sharing workflows across counterparties to maintain compliance.
5. Trade State Reports (TSR) and Lifecycle Event Clarity
One of the most notable updates in the EMIR Refit guidelines is the emphasis on maintaining an accurate Trade State Report. Lifecycle events such as terminations, modifications, and revivals must now be reported using structured action and event type combinations.
Best practice: Implement automated logic in your reporting engine to track and categorise lifecycle events based on EMIR Refit guidelines. This is critical for both internal reconciliation and regulatory transparency.
6. Intragroup and Fund Reporting Rules Updated
The EMIR Refit guidelines clarify how intragroup transactions and fund structures (e.g. UCITS and AIFs) should be reported. Intragroup exemptions require notification to NCAs and fund managers now bear explicit responsibility for reporting on behalf of their funds.
Important to note: Counterparties relying on previous exemptions must verify whether they still apply. Firms managing multiple fund structures should assign clear responsibilities to prevent underreporting.
How Reg-X Can Help
Reg-X Innovations supports firms navigating the EMIR Refit guidelines by providing automation tools tailored for RTS/ITS compliance, reconciliation checks, UTI workflow support, and delegated reporting oversight. With our middleware, you can align your data architecture and reporting outputs directly with ESMA’s specifications.
For further details on how we support regulatory reporting:
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Stay ahead of EMIR Refit guidelines. Review your reporting framework, validate delegation pathways, and reinforce your reconciliation strategies for 2024 and beyond.
