Allen and Overy provided one of their lunchtime seminars on Monday with a comparison between Dodd Frank and EMIR. Below are my notes from their presentation and a PDF of the slides.

You should follow up with the very knowledgeable A&O staff on this:

• EU: damian.carolan@allenovery.com
• US: deborah.north@allenovery.com
• US: john.williams@allenovery.com

Key points:

1. Entity definitions for SD & MSP are done
2. Product definitions are not, once they are, the rest of the regulations will lock into place
3. EMIR final text not yet published, still being finalised
4. Regulatory and Implementing Technical Standards are being prepare for Sept 30th European Commission
5. First text of MIFIR out 9th May ‘first compromise text’
   • Trading
   • Transparency
   • Position limits
   • Mandatory clearing of certain contracts
   • Now goes into trialogue before final text
6. SEC & CFTC product exceptions (page 7)
   • Insurance
   • Consumers
   • Fx forwards and Swaps but not NDFs
7. Page 8, definitions of an OTC product sources for Europe
8. No carve out in Europe for FX contracts, MIFID doesn’t capture physically settled FX forwards
9. Page 9: Not clear if trades with non-US parties count in aggregation towards SD threshold of $8bn
10. Page 10
    • Branches not yet clear
    • Is a branch of a non-EU entity included?
    • Intra-group exemptions for clearing and reporting
11. Page 11
    • Pre-enactment swaps
    • Designation of clearable trades coming in the autumn
    • Will probably be an exemption for inter-affiliate trades in the US
12. Page 12: Exemption must be invoked on a trade by trade basis, to show they are hedging or mitigating commercial risks
13. Page 13: LSOC implementation Nov 8th 2012
14. Page 14: April 9th LSOC rule published, Compliance by Nov 8th 2012
15. Page 16:
    • A trade struck between a CCP offering it for clearing and ESMA agreeing it should be mandatory, should be back-loaded (front loading)
    • Group assessment criteria need working through in detail to get group exemptions
16. Page 21: Once mandatory clearing rules finalised (product definitions), then trading is 30 days after
17. Page 24
    • All swaps must be reported regardless of exemptions
    • Regulators seem unconcerned whether swaps get reported to multiple repositories
    • Who regulates the repositories?
    • Trades struck on a SEF or at a CCP can be reported by the SEF of CCP, you need to provide valuation data on an on-going basis
18. Page 25: Reporting is either July 16th or 60 days after the product definitions of swap
19. Page 30
    • If no repository available, then report to ESMA
    • Reporting will be retrospective
20. Page 36: Trades with NFCs don’t require collateral unless threshold reached
21. Page 37:
    • Once the product definitions are issued, registration will be required
    • ISDA protocol project on business conduct standards

The full presentation can be downloaded as a PDF here.