ESMA is consulting on RTS setting out the conditions under which EMIR would apply to an OTC contract entered into by non-EU counterparties. Under EMIR the transaction would have to have direct, substantial and foreseeable effects within the EU. The draft RTS propose that EMIR would only apply where the non-EU counterparties' jurisdictions are not deemed equivalent to EMIR and one of the counterparties is guaranteed by an EU financial counterparty and/or both non-EU counterparties execute their transactions via their EU branches. The RTS also cover non-EU counterparties' attempts to evade EMIR requirements. ESMA asks for comments by 16 September. (Source: RTS on EMIR Application to Non-EU Counterparties)