On 8 September 2021, there was published in the Official Journal of the EU Commission Delegated Regulation (EU) 2021/1456 of 2 June 2021 supplementing Regulation (EU) No 648/2012 of the European Parliament and of the Council by specifying the conditions under which the commercial terms for clearing services for over-the-counter derivatives are to be considered to be fair, reasonable, non-discriminatory and transparent (FRANDT).
The objective of the Delegated Regulation is to specify the conditions under which commercial terms for clearing services of clearing service providers are to be considered to be FRANDT. The Annex to the Delegated Regulation sets out the requirements that contractual terms must meet in order to be considered as FRANDT: the transparency of the on-boarding process; the form for a request for proposal; disclosure of commercial terms; risk control assessment; the obligation to lay down in the contractual terms in writing; fees, and pass on costs; and the refusal of clearing orders, suspension of clearing services, liquidation or close-out of client positions, and the termination of contracts.
The Delegated Regulation enters into force on the day following its publication in the Official Journal of the EU. It shall apply from 9 March 2022.
Commercial terms for clearing services agreed before 9 September 2021 shall be reviewed and, where necessary meet the requirements laid down in the Annex, modified by 9 September 2022.