This standard is aimed at improving the processing of position transfers in the exchange-traded derivatives markets.
Date
16 Jan 2025
This standard is aimed at improving the processing of position transfers in the exchange-traded derivatives markets.
1. EMIR Refit Prior UTI
The FIA Reporting call which is tracking open issues/challenges in the industry as a result of EMIR Refit (and/or any other regulatory changes). One of the issues the industry has been raising since EMIR Refit is around position transfers and the need to report the Prior UTI. This is not typically available to the party accepting the Position transfer, so there is a need to have a workflow in place to communicate and capture the UTI between the two parties to the transfer. All CCP’s should include the Prior UTI as a populated field in the position transfer process so it can be consumed by the Clearing member (s) for EMIR Refit reporting obligations. There should be a connection between the 2 FIA WG’s to ensure this requirement is understood and covered by the Standard.
2. CCP API’s
From a Vendor perspective having API connectivity to send / consume position transfers would be beneficial to remove manual processes / uploads. The API’s should be consistent across all the CCP’s which will allow a standardised connectivity and not a bespoke set up per CCP. The API will also greatly improve the time taken to instruct and complete the transfer process.
3. Impediments
Adoption of the ‘Standard’ by the CCP’s and timeframe to implement i.e. clients may send all CCP data in the new proposed Standard but not all CCP’s may be ready to accept this and this will lead to manual work to be performed on the transfer files for CCP’s who have not adopted the standard.
Ability of the end clients to meet the deadlines for the 3 Transfer Types (Simple, Complex, Complex Exchange Approval). Tracking and adherence of CM’s / end clients to the timeframes stipulated for the position transfer types.
4. DMIST Standard Cleared Swap Positions
Yes, this should be aligned as closely as possible to the Derivatives standard as end clients will potentially hold positions in both asset classes so alignment would be beneficial where appropriate.
FIA Operations Americas Division (“Division”) appreciates the opportunity to comment on the DMIST Position Transfer Consultation Paper. The FIA Operations Americas Division, with input from FIA's European and Asian Operations Committees, submitted a proposal to the DMIST Sponsor Board in May 2024 to standardize Position Transfers. The Division is pleased to see that much of the proposal was adopted and commends the DMIST Working Group for their work in enriching the proposal.
Intercontinental Exchange Inc. on behalf of itself and its subsidiaries (collectively “ICE”), appreciates the opportunity to provide feedback to the DMIST Consultation Paper: Standard Regarding Position Transfers.
In the pages which follow are ICE’s comments to the Consultation Paper, presented in-line to excerpts from the Consultation Paper itself. Any section numbering is taken from the original DMIST Consultation Paper.
This consultation response covers two entities at Nasdaq Inc.; Nasdaq Clearing AB (a CCP) & Nasdaq Technology (a global provider of CCP technology).
Nasdaq welcomes the DMIST newly proposed industry standard for Position Transfers and recognizes the need for greater standardization across all central counterparties (CCPs) operating in exchange-traded derivatives.
We believe the proposed standard would help CCPs, clearing members and clients to make position transfers more efficient and secure.
FIA’s European Operations, EMIR Reporting, Compliance and Technology Vendor Committees (the Committees) welcome the DMIST consultation paper which recommends standardisation of certain aspects of the position transfer process to improve efficiency, enhance controls and reduce risks.
When reviewing the proposals, the Committees’ also considered how the position transfer templates could assist in addressing reporting challenges firms subject to UK or EU European Market Infrastructure Regulations (EMIR) reporting obligations face in relation to the requirement to report Prior Unique Trade Identifier (UTI) upon lifecycle events, including Position Transfers (PTs).
Thank you for the opportunity to provide feedback on the DMIST consultation paper regarding the standardization of position transfers and for our productive call last week. This email summarizes our key points from the discussion.
We agree that the rationale behind using position transfer functionality has evolved over the past year, while the overall volume of position transfers within Eurex Clearing has remained stable or even declined since we increased the transaction duration from T+3 to T+5 in 2020. While we acknowledge the potential benefits of standardization, we believe that focusing solely on a standardized upload sheet format for position transfers may present challenges and limit future innovation.