Date for your diary: Annual calculations under EMIR and UK EMIR

17 June 2022 - NFC calculations

Under EMIR and UK EMIR, the calculation of OTC derivatives positions for the purposes of the clearing thresholds for non-financial counterparties (NFCs) is an annual one. Unless the calculation has already been re-run since 17 June 2021, or derivatives only began to be entered into since 17 June 2021, the calculation must be re-run in accordance with the relevant rules by 17 June 2022 for the period June 2021 to May 2022 for an entity to continue to benefit from being an NFC-. Failure to run the calculation would mean that the entity is considered to be an NFC+. Note that there may be differences in the calculation under EMIR and UK EMIR due to differences in certain defined terms.

To do: Make appropriate internal records of the calculation (or decision not to run the calculation) and address all implications of any resulting change in status. These may include notifications to regulators and disclosures to counterparties.

17 June 2022 - Small FC calculations 

Under EMIR and UK EMIR, the calculation of OTC derivatives positions for the purposes of determining whether an entity is a small FC is also an annual one.  Note aspects of the calculation do differ from the NFC calculation and there may be differences in the calculation under EMIR and UK EMIR due to differences in certain defined terms. Unless the calculation has already been re-run since 17 June 2021, or derivatives only began to be entered into since 17 June 2021, the calculation must be re-run in accordance with the relevant rules by 17 June 2022 for the period June 2021 to May 2022 for an entity to continue to benefit from being a small FC that is exempt from the clearing obligation.

To do: Make appropriate internal records of the calculation (or decision not to run the calculation) and address all implications of any resulting change in status. These may include notifications to regulators and disclosures to counterparties.