The Committee of European Securities Regulators (CESR) has published a consultation on guidance to report transactions on OTC derivative instruments.
The consultation paper seeks to define useful common standards for consistent collection of data from investment firms. It defines and explains, for each derivative instrument type, how the fields of transaction reports should be populated to represent in a harmonised manner the execution of a transaction on such an instrument. Examples in the consultation are intended to help clarify the types of OTC derivatives that will become reportable by investment firms.
CESR notes that the ultimate underlying instrument of the OTC derivative is a key element that determines whether a derivative is reportable or not. Essentially if the value of the OTC derivative is dependent upon the performance of a single security or the risk of a single issuer, any transaction in that instrument by an investment firm is reportable.
The examples provided by CESR in the consultation are not exhaustive.
The deadline for comments on the consultation is 1 April 2010.
View Consultation on guidance to report transactions on OTC derivative instruments, 29 January 2010