On 25 November 2021, the FCA and Bank of England (BoE) co-published Consultation Paper 21/31: Changes to reporting requirements, procedures for data quality and registration of trade repositories under UK EMIR (CP21/31).

In CP21/31 the regulators are setting out three proposals:

  1. Amendments to the framework for derivatives reporting under Article 9 of UK European Market Infrastructure Regulation (UK EMIR). The FCA and BoE are consulting on changes to the framework for derivatives reporting which apply to all counterparties. The FCA and BoE will rely on their respective powers to make, amend and revoke technical standards as set out under Article 9(5) and 9(6) UK EMIR and Section 138P of the Financial Services and Markets Act 2000 (FSMA). Among other things the FCA and BoE are proposing:
    1. Amendments to the table of reportable fields in the relevant technical standards under UK EMIR, primarily so it aligns with international guidance issued by CPMI-IOSCO.
    2. Notifications and reconciliation processes for counterparties.
    3. Specific requirements for the mandatory delegated reporting requirements under UK EMIR in the relevant technical standards. The proposals set out the arrangements the financial counterparty should put in place for the timely provision of relevant information by the non-financial counterparty.
    4. That counterparties should use standardised XML schemas when submitting details of their derivatives trades to a trade repository (TR).
    5. Specific requirements for the use of global identifiers, including the use of Legal Entity Identifiers, Unique Trade Identifiers and Unique Product Identifiers.
  2. Amendments to the registration process for TRs. With this proposal, the FCA is seeking to streamline the process for TRs that are already registered or recognised under the Securities Financing Transactions Regulation (SFTR) and to incorporate the payment of the relevant registration fees. These changes are aimed at aligning the registration processes under UK EMIR and UK SFTR. The FCA will rely on its power set out in Article 56(3) UK EMIR and Section 138P FSMA to amend technical standards.
  3. Requirements for TRs to establish procedures and policies. The FCA intends to improve data quality with this new proposal. It will ensure that there are procedures and policies in place for the effective reconciliation of data between TRs, to verify that the reported data is complete and correct and the orderly transfer of data between TRs. This would result in new rules for TRs which the FCA aim to include in a new specialist sourcebook, the UK EMIR Rules. The FCA proposes to rely on its rule making power in Article 78(10) UK EMIR (as inserted by Section 40 of the Financial Services Act 2021).

The deadline for responding to CP21/31 is 17 February 2022.