EMIR derivative reporting after the REFIT

EMIR splits counterparties into financial and non-financial, and then splits each by whether it exceeds the clearing thresholds. A financial counterparty above a threshold is an FC+, below it an FC-. A non-financial counterparty above a threshold in an asset class is an NFC+ for that class, below it an NFC-. Banks, investment firms, insurers, UCITS and alternative investment funds are financial counterparties; a corporate treasury hedging its own exposures is normally a non-financial one.

The classification is not a one-time filing. A counterparty calculates its aggregate month-end average positions over the previous twelve months, per asset class, and a non-financial counterparty may exclude positions that hedge its commercial activity. Crossing a threshold triggers a notification to the authority and to ESMA and brings the clearing obligation for that class. Our page on corporate treasury covers the hedging side of the same calculation.

EMIR Article 9(1a) moved the duty instead of sharing it. Where a financial counterparty trades with an NFC-, the financial counterparty is solely responsible and legally liable for reporting the contract on behalf of both parties, and for the accuracy of what it reports. The NFC- supplies the details that only it holds and may still choose to report itself, in which case it tells the financial counterparty.

A management company reports for a UCITS, and an alternative investment fund manager for an AIF. Delegated reporting by agreement remains possible for other combinations, and the point firms miss is that delegation moves the work and not the liability: a counterparty that delegates stays responsible for the report's correctness unless the mandatory rule applies.

The reportable field count rose to 203 from 129, of which 148 are reconciled between the two sides' reports. The reconciliation came in two stages: a first group of fields from the start of the regime, a second group two years later, which is why a reconciliation break list grew in 2026 without anyone changing a system.

Every report now goes in ISO 20022 XML, under Commission Implementing Regulation (EU) 2022/1860, and the earlier formats are refused. New and changed fields include the event date, the action and event type pair that describes what happened to the contract, the delta for options and swaptions, pre-haircut and post-haircut margin amounts, a custom basket code, and the direction expressed as a payer and receiver leg or as buyer and seller. ESMA's reporting guidelines and its validation rules are the operative documents; the regulation sets the duty, the validation rules decide whether a file is accepted.

Each contract carries one unique trade identifier shared by both counterparties, and a waterfall decides who generates it: a CCP for a cleared trade, otherwise the venue, otherwise a sequence of tests on the counterparties' status that ends with the alphabetically earlier legal entity identifier. The generating side shares the UTI with the other by 10:00 CET on the working day after execution, which is what makes a T+1 report possible at all.

The unique product identifier replaced product classification by field. For an OTC derivative the UPI comes from the ANNA Derivatives Service Bureau against the product's reference data; an exchange-traded product or one executed with a systematic internaliser uses its ISIN instead. Retrieving the UPI is the reporting counterparty's job, and a product traded for the first time needs its UPI before the trade can be reported, not after.

Both counterparties need a legal entity identifier, kept current. A lapsed LEI on either side fails the validation, which is the most common reason a report that worked last month stops working this month.

Reports go to a trade repository registered with ESMA, which validates each submission and either acknowledges it or returns a rejection. A rejected report, a NACK, has to be corrected and resubmitted; the practice the repositories and ESMA's guidelines expect is resolution within five working days, and an unresolved rejection means the contract is simply unreported.

Where both sides report, the repositories compare the reconcilable fields and produce a break report. The breaks that persist are rarely dramatic: a timestamp rounded differently, a notional on a different convention, a valuation from a different model, a maturity date one side adjusted for a holiday calendar the other did not. Someone has to own that report daily, because a break nobody reads is a report the authority reads as wrong.

A notification, and the threshold is lower than firms expect. ESMA's reporting guidelines require a counterparty, or the entity responsible for reporting, to notify its competent authority of a significant misreporting issue: missing reports, a material number of rejected reports, a prolonged outage at a reporting system, or an error affecting a significant portion of the reports. In Germany the notification goes to BaFin.

The counterparty assesses materiality itself, which makes the assessment the record a supervisor reads. A firm that found a two-month gap, fixed it and documented why it was not notifiable has an argument; a firm that found it, fixed it and wrote nothing does not.

Three reporting regimes sit next to each other and overlap less than their field lists suggest. EMIR covers derivative contracts, both OTC and exchange-traded, reported by both counterparties to a trade repository on T+1. SFTR covers repos, securities lending, buy-sell backs and margin lending, also to a trade repository on T+1, with a collateral reuse report EMIR has no equivalent to. MiFIR transaction reporting covers instruments admitted to trading, goes to the national authority through an approved reporting mechanism, and exists to detect market abuse and not to measure systemic exposure.

The same trade can therefore generate an EMIR report and a MiFIR transaction report with different content, different recipients and different deadlines. Firms that built one reporting pipeline and filtered it per regime usually discover the differences through rejections.

Article 10 EMIR brings the clearing obligation for a counterparty that exceeds a threshold: contracts in the affected class are cleared through an authorized central counterparty. The thresholds are set per asset class in the delegated regulation, and ESMA publishes which classes are subject to clearing. An NFC- that crosses a threshold in one class clears that class only, while an FC- that crosses any threshold clears across all classes it trades.

Clearing changes the reporting too, because a cleared trade carries the CCP as a counterparty and the CCP generates the UTI. The hub answers on clearing houses and collateral cover the mechanics behind that.