The PRA and FCA yesterday launched a joint consultation on whether to align UK EMIR margin requirements with the rest of the world and continuing market practice. One would hope that if any responses are received by the 19 May 2021 deadline, they would be unanimously supportive. The consultation covers the following aspects: IM phase- […]

The FCA has today issued the official death knell for LIBOR. The announcement constitutes an index cessation event under the IBOR Fallbacks Supplement and the ISDA 2020 IBOR Fallbacks Protocol for all 35 LIBOR settings. 5 March 2021 is therefore the date on which the fallback spread adjustment will be fixed. Publication of 26 LIBOR […]

Risk magazine (paywalled) are today reporting that over half of phase 5 IM new entrants may fail to meet custodian deadlines, potentially rendering them unable to trade on the 1 September 2021 deadline. Widely predicted and warned against at the time, a large number of firms took the April 2020 extension as an invitation to […]

26 February 2021, the long-awaited MiFID II “Quick” Fix Directive was published in the OJ. The Quick Fix is in response to the CV-19 epidemic and associated disruptions, it is not intended to replace the ongoing full MiFID II review. First proposed as part of the 24 July 2020 Capital Markets Recovery Package, the Quick […]

For those lucky few with time to spend participating in regulatory consultations, there are another two potentially material ones to be aware of. 12 February 2021, the EC launched two parallel, but linked[1]  consultations on proposed amendments to the Financial Collateral Directive (FCD) and the Settlement Finality Directive (SFD). The FCD was adopted on 6 […]

17 February 2021. Delegated Regulations further amending the EMIR Margin RTS and amending the three Clearing Obligation RTS have today been published in the OJ. They will both enter into force on the following day- 18 February 2021. Amendments to the Margin RTS Extension of equity options derogation until 4 Jan 2024 Extension of intragroup […]

15 February 2021, HM Treasury launched a consultation titled “Supporting the wind-down of critical benchmarks”.  On 21 October 2020, the government introduced the Financial Services Bill to Parliament. This Bill includes amendments to the Benchmarks Regulation (BMR), which provide the FCA with new and enhanced powers to oversee the orderly wind-down of critical benchmarks, such […]

Although confirming an earlier Audit Court judgement in respect of jurisdiction, the recent publication of a 17 November 2020 decision in respect of Morgan Stanley by the Italian Supreme Court (Court of Cassation), serves as a reminder that the status of derivatives under Italian law is still far from settled. This note briefly reviews the […]

The IBOR Fallbacks Protocol is legally effective as of today. Following a permanent IBOR cessation, or an FCA determination that a LIBOR has “become” non-representative, fallbacks in the form of adjusted risk-free rates will apply to in-scope derivatives contracts. Clearly, the Protocol only applies to those who have adhered- 11902 to date. Purely in terms […]