On Mar. 26, LUX CSSF issued reminder on EMIR REFIT reporting.
LUX CSSF reminded all counterparties involved in derivatives transactions of the upcoming entry into force of the new EMIR REFIT reporting on Apr. 29, 2024.
This circular has been made available by LUX CSSF in an English version only.
LUX CSSF CSSF requests counterparties consider elements set out in this circular, with a particular emphasis on the importance of testing before implementation of rules.
References ESMA's guidance on the EMIR Reporting page, for critical information.
Entities shall notify LUX CSSF of significant errors and omissions, as per Article 9 of the ITS on reporting, and LUX CSSF will monitor volume of currently submitted trades.
Monitoring by LUX CSSF will include variations in the volumes of reported transactions.
Should an entity cease to exist, it must close trades from contractual point of view, and with appropriate termination messages to the relevant Trade Repositories.
Should another entity take over the reporting on behalf of one counterparty, that counterparty must ensure that no trades are either forgotten or reported twice.
Counterparties are required to monitor the reporting they submit, or the reporting submitted on their behalf and must ensure its accuracy, which is set out by LUX CSSF.
Internal Controls for Counterparties
LUX CSSF advises internal controls to include, amongst other things the identification of outliers, bad comma placement, bad currency conversion, and bad input data.
Also includes application of correct action type (MODI vs CORR), identification and removal of duplicates, timeliness checks (timely reporting), and consistency.
Specifically, consistency between trading activity and reporting, so entity only dealing with EQ derivatives should make sure that only EQ derivatives are reported.
Counterparties must also ensure consistency over time of the reporting with the real activity, such as volume, amounts, counterparties, advises LUX CSSF in its circular.
Importance of Testing
Trade Repositories have made their platforms available for testing, and LUX CSSF insists that all participants ensure ability to submit their trades prior to go-live date.
LUX CSSF reiterates there has been sufficient time for stakeholders to make changes.
In Apr. 2024, LUX CSSF informed of new procedures for forms, requests, see #210425.
Oct. 2024 Transition Period Reminder
On Oct. 7, 2024, LUX CSSF reminded that the end of the new reporting requirements' transition period under the EMIR RTS and ITS regime is the date of Oct. 26, 2024.
For all derivatives outstanding after that date, counterparties shall submit a report with event type Update, unless they submitted a report Modify or Correct before this date.
