The short timeframe for reporting compliance will leave many caught short, writes Dan Barnes.
Too few firms, predominantly buy-side, have registered for
legal entity identifiers (LEIs), codes they will need to report
derivatives trades, under the European Markets Infrastructure
Regulation (EMIR) from 12 February 2014. If businesses are
unable to report trades they are leaving themselves open to
"There is a definite feeling that many firms, not just
buy-side firms, will not be ready for the 12 February reporting
deadline," says Wesley Lund, associate director at hedge fund
trade body the Alternative Asset Management Association (AIMA).
"The amount of knowledge that is out there not great, there is
continued uncertainty around certain areas of EMIR, some of
which have only recently been clarified, and the sheer volume
of work that funds need to carry out in order to get set up
with a trade repository (TR) is sizeable."
As of 29 January 2014 there were just 90,138 firms
registered for LEIs outside of the US, according to trade
industry body p-lei.org. There are approximately one million
firms that will need to report trades in Europe, according to
the Depositary Trust and Clearing Corporation, itself a trade
reporting repository (TR). The discrepancy between the number
of firms that are registered and the number that need to
register suggests that many firms will be non-compliant.
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