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The European Securities and Markets Authority (ESMA), the EU’s financial markets regulator and supervisor, is asking for input on the new clearing thresholds under the review of the European Market Infrastructure Regulation (EMIR 3).
The consultation paper is part of ESMA's mandate to develop Regulatory Technical Standards (RTS) on clearing thresholds, and covers the following areas:
- proposals for a revised set of clearing thresholds,
- considerations for hedging exemptions for non-financial counterparties,
- a trigger mechanism for reviewing the clearing thresholds.
The revised clearing threshold methodology focuses on the activity in over-the-counter (OTC) derivatives not cleared at an authorised or recognised central counterparty (CCP). This approach assesses the risk associated with uncleared activity to determine if entities should be mandated to clear their OTC derivatives.
The new methodology aims at ensuring a proportionate clearing obligation regime, focusing on entities with significant OTC derivatives activity and large uncleared positions.
Next Steps
The consultation will remain open until 16 June 2025. Based on the feedback received, ESMA will publish a final report and submit the draft technical standards to the European Commission by the end of the year.
