The Russian Federal Service for Financial Markets on Friday published amendments to its trade reporting regulation to address uncertainties resulting from the delayed launch of the country’s trade repository.
In addition to the delay of the repository, it is understood that the National Settlement Depository (NSD) is unable to accept reporting with respect to all types of transactions that are required to be reported from day one.
The amendments to the December 2011 regulation will enter into force on Feb. 5 2013.
In particular, the amendments to the reporting regulation include:- clarify the list of reportable transactions: these include repos, FX swaps, other derivative transactions as well as other FX and securities transactions, in each case concluded under a master agreement;- provide for the gradual introduction of the reporting requirements: during the initial phase of NSD’s operations, the market participants would only be required to report repos and FX swaps with the requirement to report other transactions delayed until such time when NSD are capable of accepting reporting with respect to such other transactions; and- extend the cut-off period for the parties to conclude trade reporting agreements with the trade repository and report outstanding historic trades from three to nine months from the date of commencement of the trade repository’s operations.
The trade reporting amendments date back to the beginning of 2011, when Russia amended its insolvency and securities market legislation also called the netting amendments – introducing rules for the recognition of close-out netting arrangements in cases of insolvency of a Russian counterparty to OTC derivative and repo transactions as well as other types of transactions with securities or foreign currency documented under a master agreement. Under the netting amendments reporting of the master agreement and of the individual transactions executed on its basis to a trade repository is one of the prerequisites for recognition of close-out netting. Law firm Clifford Chances Moscow practice noted, however, that the reporting requirement is more general for it requires the parties to a master agreement to report OTC transactions executed on its basis irrespective of whether they intend to take advantage of close-out netting arrangements or not.
(JDC)