|EMIR frontloading not in jeopardy?|
|Friday, 18 July 2014 20:33|
The key part of the EC letter explains that:
"The determination of remaining maturities should not result, in particular, in the application of the frontloading requirement to OTC derivatives concluded before counterparties could reasonably foresee that those contracts would need to be cleared as a consequence of the frontloading requirement. Such application could jeopardize the principle of legal certainty. In this respect, the Commission considers that before ESMA submits the RTS to the Commission, counterparties cannot reasonably foresee the terms of the frontloading obligation. Moreover, since the RTS may be amended or even rejected before they enter into force, some uncertainty may remain as to the concrete terms of the frontloading requirement until the delegated act adopting the RTS is finally published in the Official Journal."
So, I agree, legal certainty, and, what is evenly important, the viability of projected solutions, mustn't be omitted.
But what is practical and concrete effect of the above clarification? I'm still confused...