The U.S. Dodd-Frank Act and the EU regulation on OTC derivatives, central counterparties and trade repositories (EMIR) both impose obligations requiring the clearing and reporting of certain derivative transactions and the margining of uncleared trades. However, there are differences as to how the U.S. and the EU regimes apply to inter-affiliate or intragroup transactions.
Clifford Chance and the International Swaps and Derivatives Association (ISDA) have produced a paper which summarises and compares:
- Regulation 50.52 adopted by the U.S. Commodity Futures Trading Commission (CFTC) providing an exemption from the clearing obligation for certain inter-affiliate swaps;
- CFTC No-Action Letter no. 13-09 providing relief from the reporting obligation for certain inter-affiliate swaps.
- EU rules: the provisions of Articles 3, 4(2) and 11(5) to (11) EMIR providing exemptions from the clearing and margining obligation for certain intragroup transactions.