ASIC is seeking feedback on proposed revisions to the rules that require the mandatory trade reporting of over-the-counter (OTC) derivatives such as interest rate swaps.
The proposals are aimed at ensuring a smooth transition to the reporting regime and follow a recent revision by ASIC of the timetable for so-called Phase 3 reporting entities (i.e. financial entities holding less than $50 billion in OTC derivatives outstanding) to start reporting OTC derivative transactions to trade repositories.
Consultation Paper 221 OTC derivatives reform: Proposed amendments to the ASIC Derivative Transaction Rules (Reporting) 2013 (CP 221) proposes changes governing the reporting of OTC derivative transactions to derivative trade repositories. The changes proposed are:
- a number of technical changes to the rules, designed to make the reporting regime more effective and easier to comply with
- clarifying the rules around delegated reporting to provide a 'safe harbour' from liability if certain conditions are met, and
- requiring certain larger overseas subsidiaries of Australian financial entities to report transactions.
ASIC Commissioner Cathie Armour said, ‘ASIC is continuing to respond to stakeholder feedback and is taking steps to refine the reporting regime to reduce the regulatory burden, especially for small financial entities. We have sought to do this while ensuring that the underlying goals of the G20 OTC derivatives commitments, to improve the integrity and stability of the OTC derivative markets, are met.
‘These rule changes, and the delay to Phase 3 reporting we recently finalised, will result in a substantial overall deregulatory benefit for industry. We look forward to receiving stakeholders' views on the proposed rule changes’, Ms Armour said.
Earlier this month, ASIC granted a delay to Phase 3 financial entities from their requirement to report. Under ASIC Instrument [14/0633], these entities will now need to start reporting no earlier than 13 April 2015, and there is further phasing by size of entity and asset class.
Submissions to CP 221 are due by 29 August 2014.