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By Paul PÉPORTÉ and Philippe NOELTNER, AO Shearman*
The European Market Infrastructure Regulation (EMIR) safeguards against derivatives market instability by introducing, amongst other things, requirements for counterparties aimed at reducing counterparty credit risk and increasing transparency. However, the requirements can be complex and Luxembourg counterparties may not always fully understand their compliance obligations which can, in a worst-case scenario, lead to regulatory sanction. Indeed, Luxembourg regulators (the CSSF and the CAA) are increasingly scrutinising non-compliance, particularly regarding reporting and data quality(1).
The Luxembourg regulators’ emphasis on obtaining data that is of good quality underscores the need...
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