EMIR Refit | Navigating the Details

On 12 June 2024, Lavinia Ponniah from DTCC Trade Repository shared the top rejections for EMIR Refit in the UK. Unsurprisingly, many of these rejections are associated with lifecycle events. This is due to Trade Repositories (TRs) implementing stricter rules and constraints on lifecycle and event sequences, as required under ESMA guidelines.

NEWT or POSC Must Be First: Firms are attempting to modify an existing report without first issuing a NEWT (New Transaction) or POSC (Position Component). Only one occurrence of NEWT or POSC is allowed per UTI.

Level Modification: Level can only be modified with Action Type CORR (Correction) or REVI (Revision).

Event Date Accuracy: Ensure the Event Date is on or after the Execution Timestamp date and prior to or equal to the expiration date (if populated) or if early terminated, the early termination date for that UTI.

Delta Field Population: Remember to populate the Delta field for Options and Swaptions with non-basket underlyings, as it is required when the valuation amount is populated. This confusion could be due to Delta being a new field.

Valuation Amount and Clearing Status: If field 2.21 Valuation Amount is populated and field 2.31 Cleared is marked with Y, field 2.29 (Clearing Counterparty Value) should be populated with CCPV (Central Counterparty Value). It is unclear why this valuation rule is being missed in submissions (EMIR-VR-2024-01).

Valuation Timestamp: The date part of the valuation timestamp must match the Event Date. Despite this being obvious, it is frequently incorrect (EMIR-VR-2023-06).

Execution Timestamp: The execution timestamp cannot be changed in a report with action type 'MODI' (Modification) (EMIR-VR-2042-03). For legacy outstanding positions where Execution Timestamp was never reported (i.e. Execution Timestamp was left blank when the position was originally reported because it wasn’t required in the past), the TR will accept MODI with Execution Timestamp populated to support clients uplifting legacy outstanding positions to REFIT technical standards.

Reporting entities can avoid many of these issues by introducing controls for lifecycle events in their systems and controls frameworks.