Partner Up with MAP FinTech to Overcome Your Challenges
With deadlines approaching for implementing the new EMIR reporting standards in the EU (April 29, 2024) and the UK (September 30, 2024), it is crucial to fully understand these new requirements and what they entail.
Based on these new standards, there has been a significant expansion in the number of relevant fields with them increasing from 129 to 203 in the EU and 204 in the UK. Considering the removal of 13 fields, this means the introduction of 87 new fields in the EU and 88 in the UK. Moreover, approximately 100 fields have undergone modifications in terms of their name, description, acceptable values, or a combination of these factors.
Overall, this increase in the number of fields poses a significant challenge and could potentially burden reporting entities. For instance, they now face the task of locating new fields, sourcing the necessary information, and incorporating them into their regular reporting cycle.
Among the new field additions, one that should have a substantial impact is the introduction of the “Event Type” field. While the “Action Type” field addresses the “What” aspect of a transaction, the “Event Type” field delves into the “Why” aspect, offering greater granularity to the event’s lifecycle. When combined, these two fields, “Action Type” and “Event Type,” results in 56 distinct and permissible combinations of values, which in turn significantly alters the lifecycle event management and necessitates specific actions within the entity’s reporting system. These actions are necessary in order to capture these events accurately and seamlessly and incorporate the changes into the reporting workflow, enabling their automatic reporting when the relevant conditions are met.
An indicative short list of EMIR REFIT’s newly introduced field-related changes can be found below:
- Unique Product Identifier (UPI) obligations
- Crypto-asset-related derivative flag
- Post Trade Risk Reduction (PTRR) related fields
- New Action Type values
- Event Type field
- Delta
The new fields mandated under the updated ITS/RTS, both individually and collectively, pose a distinctive challenge for firms. As previously mentioned, this challenge is multifaceted, starting with identifying and localizing these fields, extending to their acquisition, and ultimately incorporating them seamlessly into the reporting cycle.
Furthermore, the increase in the number of EMIR REFIT fields compounds the complexity of an already complicated task, one that includes coordination between reporting counterparties to ensure the accurate completion of these fields to prevent unnecessary pairing and matching issues.
In addition, if not handled correctly, this increase may result in an elevated risk of receiving more rejections from Trade Repositories (TRs) and failures to match, given that with the new RTS/ITS additional fields will be reconciled by TRs. Moreover, firms will now have to deal with larger incoming and outgoing files (the more fields, the bigger and more complex the file becomes), introducing additional overheads in terms of processing resources, storage requirements, and the level of complexity when working with these files.
At MAP FinTech, we are well-equipped to help you with these challenges. Firstly, we can provide valuable guidance in understanding which reportable fields are relevant to your specific trading model and activity. Furthermore, we offer flexibility in terms of how this information is retrieved or received from the reporting entity, ensuring the seamless integration of data.
Our approach to the increase in the number of fields involves requesting only the necessary information from the reporting entity, while employing conditional rules and enhancement criteria to complete the remaining required fields. This facilitates the reporting process and reduces the burden on the reporting entity.
Furthermore, our Polaris web portal (the interface of our Polaris reporting platform) offers an efficient solution for managing fields that do not change very often (the so-called static information). This user-friendly portal simplifies the task for reporting entities, making field management as straightforward as possible.
Also, our reporting algorithms are designed to automatically identify relevant actions taking place in the client’s trading system or data and map them to the appropriate action and event types in reporting, thus providing substantial assistance to the reporting entity to overcome this challenge.
Lastly, thanks to the numerous validations incorporated into our Polaris reporting platform, potential rejections are caught at an early stage within the reporting system before they reach the TRs and the National Competent Authorities (NCAs). This proactive approach ensures that, despite the increase in the number of fields, reporting firms will maintain a healthy reporting framework and remain compliant at all times.
Partner Up with MAP FinTech to Overcome Your Challenges
MAP FinTech is a leading and award-winning global regulatory technology provider, highly regarded for its proprietary reporting technology and exceptional client-centric after-sales support. As one of the first providers in Europe to report under the European Market Infrastructure Regulation (EMIR), with billions of transactions reported successfully so far, we have built a reputation for excellence, coupled with the necessary regulatory expertise and technological innovation to help navigate their respective regulatory obligations. Contact our team of experts to learn how you can benefit from our innovative and comprehensive regulatory reporting solutions and achieve a smooth transition to the changes in reporting requirements brought by EMIR REFIT.