European Market Infrastructure Regulation (EMIR)
The European Market Infrastructure Regulation (EMIR) is a European regulation regarding derivatives, central counterparties and trade repositories. EMIR is set up following the commitment announced by the Group of 20 (G20) in 2009 to increase regulation on non-centrally cleared derivatives with the objective to increase the stability (mitigation of systemic risk and transparency) within global derivative markets. This regulation entered into force on 16 August 2012 and its obligations gradually took effect from 2013 onwards.
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Please note that this publication only serves to provide general back-ground information, is not necessarily complete or correct, and does not contain individual, legal or other advice. EMIR might impact your (OTC) derivatives business and your relationship with us, so we urge you to inform yourself on this subject and obtain the necessary advice.
Client Classification and Obligations
EMIR recognizes a number of counterparty classifications. The effects, obligations and responsibilities to comply with EMIR vary according to the classification of an entity.
What are the counterparty classifications and obligations under EMIR?
EMIR recognizes the following counterparty classifications:
| Asset Class | Threshold in gross notional value |
| Credit derivatives | €1 billion |
| Equity derivatives | €1 billion |
| Interest rate derivatives | €3 billion |
| Foreign exchange derivatives | €3 billion |
| Commodity and other derivatives | €4 billion |
Table 1. Clearing thresholds
Exempted Entities are exempted from clearing and reporting obligations. These entities include members of the European System of Central Banks (ESCB) and other Member States’ bodies performing similar function, EU public bodies charged with the management of public debt, The Bank for International Settlements, and certain Third Country Central banks/ public bodies charged with the management of public debt (subject to the Commission including these entities to the exclusion).
Partially Exempted Entities are subject to reporting obligation. These entities include multilateral development banks, public sector entities if owned by central governments and that have explicit guarantee arrangements provided by central governments, the European Financial Stability Facility and the European Stability Mechanism.
What are the obligations under EMIR?
This is an obligation to clear certain classes of OTC derivatives through a central counterparty (CCP). To determine which classes of OTC derivatives are subject to the clearing obligation, ESMA takes various factors into account (the extent of standardization, volume, liquidity in the market, etc.).
The risk mitigation measures apply to OTC derivatives and include timely confirmation, dispute resolution, portfolio reconciliation, portfolio compression, valuation of contracts and exchange of collateral. These obligations apply depending on the qualification of the counterparties (FC+, FC-, NFC+ or NFC-).
In order to comply with EMIR reporting requirements, FCs as well as NFCs and partially exempted entities have to report the details of their derivative contracts (concluded, modified or terminated) to a Trade Repository (TR). This obligation applies to both cleared and non-cleared derivatives, exchange-traded as well as OTC derivatives.
The reporting obligation does not apply to non-EEA counterparties, but in case you trade OTC derivatives with EEA counterparties (such as Rabobank), the EEA entity may still have to disclose information regarding the non-EEA counterparty to comply with its own reporting obligation.
Under EMIR REFIT, the reporting rules have been updated and the new requirements will apply per 29 April 2024.
Rabobank Information
Coöperatieve Rabobank U.A (formerly known as Coöperatieve Raiffeisen-Boerenleenbank B.A.)
| Emir classification | FC+ |
| Emir Clearing Category | Category 1 |
| Legal Entity Identifier (LEI) | DG3RU1DBUFHT4ZF9WN62 |
| Rabobank is able to clear OTC transactions with the following EU authorized CCP’s | Interest rate swaps: |
EMIR Refit
In December 2022, the European Commission proposed updates to EMIR with EMIR REFIT, as part of a broader package of measures related to the Capital Markets Union (CMU). As a result, several changes will apply per 29 April 2024, particularly in the transaction reporting rules. For more information, see the topic Reporting Obligation.