Further to our e-briefing dated 3 March 2014 regarding the deadline for pension plan trustees to comply with the risk mitigation requirements under the European Market Infrastructure Regulation (“EMIR”), please note that the Financial Conduct Authority’s (“FCA’s”) announcement only relates to the risk mitigation requirements relating to:

  • portfolio reconciliation (which involves both parties to a transaction reconciling key trade information on their records),
  • portfolio compression (i.e. where appropriate, reducing the number of transactions the pension plan has with a single counterparty), and
  • the need to put in place a dispute resolution procedure, including reporting disputes over a certain value that are not resolved after 15 days to the competent regulator (e.g. the FCA).

As set out in Monday’s e-briefing, if trustees are not already complying with these requirements, which they ought to be, they must put in place a detailed and realistic plan to achieve compliance with these requirements within the shortest time-frame possible. The FCA expects that such plans will be completed and implemented by 30 April 2014 and trustees must be in a position to demonstrate compliance after that date.

Trustees (and other parties that have entered into derivatives transactions) should already be complying with the other risk mitigation requirements under EMIR and, if they are not doing so, they should take immediate action to remedy this.

More information

Click here for more information on what you need to do to comply with the EMIR regulatory requirements.