The granting of Australia’s first trade repository licence this week triggers the timing on a range of derivative trade reporting obligations in Australia, especially those applicable to Australia’s fund industry. With deadlines now locked in, there is much for these market participants to do

A key deadline is 13 April 2015, which is when a number of such buy-side participants will need to start reporting transactional data on interest rate and credit derivatives. These participants (which include a number in the Australian funds industry) have approximately 7 months (not that long, considering it includes the Christmas break) to:

  • determine how they will establish connectivity to the licensed repository;
  • put in place any delegation arrangements (which is subject to ASIC’s consultation on rules amendments); and
  • ensure they otherwise have systems and processes to enable them to meet their reporting obligations under ASIC’s trade reporting rules.

Others will have a little longer (until October 2015) if they do not trade interest rate and credit derivatives or did not hold at least $5 billion in gross notional positions at 30 June 2014.

In either case, the clock is ticking and the pace at which this OTC reform unfolds has not slowed.

Does the above apply to me?

The reporting obligations described above are relevant to “Phase 3” Reporting Entities under ASIC’s reporting rules which have not already started reporting under ASIC’s trade reporting rules. An entity fits the description of a “Phase 3” Reporting Entity if it:

  • is not registered or provisionally registered as a swap dealer with the US CFTC; and
  • is at least one of the following:
    • an entity (including a corporation, partnership, managed investment scheme or trust) incorporated or formed in Australia or a foreign subsidiary of such an entity where that entity is an Australian ADI or AFS Licensee,
    • a foreign registered company under the Corporations Act, or
    • a Foreign ADI with an Australian branch; and
  • is at least one of the following:
    • an Australian ADI,
    • an AFS Licensee,
    • a CS Facility Licensee,
    • an Exempt Foreign Licensee, or
    • a Foreign ADI; and
  • did not hold total gross notional outstanding positions of AUD 50 billion or more as of 31 December 2013; and
  • enters reportable derivative transactions under ASIC’s trade reporting rules.

For more background information…

A copy of ASIC’s media release on the granting of the first trade repository licence to DDRS can be found here. More information about the ASIC Instrument can be found here. More information on trade reporting requirements can be found here.