As the dust settles on the EU–UK Trade and Cooperation Agreement, and the majority of businesses have returned after a break of some kind at the end of 2020, the end of the Brexit Transition Period means that UK (and some EU and EEA) users of derivatives find themselves in a new regulatory environment.
The UK, and its domestic regulators, are now responsible for administering UK EMIR (the UK on-shored version of the European Market Infrastructure Regulation ("EMIR")). While this is primarily of relevance to UK users of derivatives, EU and EEA users of derivatives with cross-border arrangements (such as European funds that trade with UK banks) will also need to understand the changes.
For example, there are some differences in the way in which derivatives need to be reported, certain deadlines for notifications to regulators, and some areas of regulatory divergence (which have, in certain circumstances, been mitigated by time-limited exemptions).
The purpose of this checklist is to act as a reference point for UK, and affected EU and EEA, users of derivatives to assist them in ensuring that their arrangements are in order.
NOTE: This briefing was up to date as of 26 Jan 2021, but please check with us that the position has not been affected by subsequent developments. We expect the regulatory environment to evolve on an ongoing basis and EU/EEA users of derivatives will need to remain aware of the possible need to adapt their trading practices in response to changing rules.