The European Securities and Markets Authority
CS 60747
103 rue de Grenelle
75345 Paris Cedex 07, France
Attention: Steven Maijoor, Chair

The European Banking Authority
Tower 42 (level 18)
25 Old Broad Street
London EC2N 1HQ|UK
Attention: Andrea Enria, Chairperson

The European Insurance and the Occupational Pensions Authority
Westhafenplatz 1
60327 Frankfurt am Main
Germany
Attention: Gabriel Bernardino, Chairman

Re: Consultation Paper regarding draft regulatory technical standards on riskmitigation techniques for OTC-derivative contracts not cleared by a CCP

Ladies and Gentlemen,

The International Swaps and Derivatives Association1 (“ISDA”) and the Securities Industry and Financial Markets Association 2 (“SIFMA”) (hereinafter referred to as the “Associations”) welcome this opportunity to respond to the Consultation Paper on the Draft regulatory technical standards (the “Draft RTS”) on risk-mitigation techniques for OTC-derivative contracts not
cleared by a CCP under Art. 11(15) of Regulation (EU) No 648/2012 published by the European Securities and Markets Authority (“ESMA”), the European Banking Authority (“EBA”) and the European Insurance and the Occupational Pensions Authority (“EIOPA”, and together with ESMA and EBA, the European Supervisory Authorities, the “ESAs”) on 14 April 2014.

INTRODUCTION

The Associations strongly support the goals of strengthening systemic resiliency in the noncentrally cleared derivatives market by establishing risk mitigation techniques and margin
requirements in accordance with the requirements of Regulation (EU) No 648/2012 (“EMIR”). While the Draft RTS are an important step forward for establishing a detailed set of requirements for the collection and protection of margin in the OTC-derivatives market in the European Union (the “EU”), it is important that the ESAs continue to focus on the practical issues relating to the implementation of such rules and the overall purpose of reducing systemic risk. This letter is intended to continue the constructive ongoing dialogue between the ESAs and derivatives market participants and to focus on the practical concerns and risks surrounding the implementation of the margin rules, including the harmonization of such rules with those of foreign regulators. We hope that our comments in this letter and follow-up discussions will inform further drafts of the RTS that the ESAs will submit to the European Commission (the “Commission”).

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