The European Commission has adopted a Delegated Regulation supplementing EMIR with RTS relating to risk mitigation techniques for uncleared OTC derivative contracts. The Regulation sets out the levels and types of collateral that OTC derivatives counterparties must exchange bilaterally if the transaction is not cleared through a CCP. In the event that one counterparty to the transaction defaults, the margin collected will protect the non-defaulting counterparty against resulting losses. The next step will be for the Council of the EU and the European Parliament to consider the Delegated Regulation.