To Whom Should Australian OTC Derivative Issuers Report?
- With the October 12 reporting deadline looming, Patricia Tsang and Sophie Gerber help issuers get a handle on reporting requirements.
This article was written by Patricia Tsang and Sophie Gerber (Director, TRAction Fintech, which provides services to report on behalf of OTC derivatives issuers).
Some OTC derivatives issuers must report to a trade repository licensed by ASIC. Currently, there is only one - the DTCC Data Repository (Singapore) Pte Ltd. However, some issuers have the option to report to a prescribed trade repository instead (ASIC prescribed six of these), subject to certain conditions. Whether an issuer may have the option depends on how the issuer is set up – whether it is:
- an Australian entity;
- a foreign subsidiary of an Australian entity where the Australian entity is an authorised deposit-taking institution (ADI) or an Australian financial services (AFS) licensee;
- a foreign ADI that has a branch located in Australia or;
- a foreign company that is required to be registered under Div 2 of Pt 5B.2 of the Corporations Act.
(1) Australian entity
An Australian entity includes a corporation, partnership, managed investment scheme or trust, incorporated or formed in Australia.
An Australian entity must report to a trade repository that is licensed by ASIC – currently, only the DTCC Data Repository (Singapore) Pte Ltd is licensed.
(2) Foreign subsidiary of an Australian entity...
...where the Australian entity is an ADI or an AFS licensee.
Such an entity can report to a licensed trade repository or a prescribed trade repository on an ongoing basis (subject to certain conditions being met) – see below.
(3) Foreign ADI that has a branch located in Australia
Such an entity can report to a licensed trade repository or a prescribed trade repository on an ongoing basis (subject to certain conditions being met) – see below.
(4) Foreign company
A foreign company that is required to be registered under Div 2 of Pt 5B.2 of the Corporations Act can report to a licensed trade repository or a prescribed trade repository on an ongoing basis (subject to certain conditions being met) – see below.
Prescribed trade repositories
For an entity referred to in (2), (3) or (4) above, such an entity has the option to report to a prescribed trade repository on an ongoing basis by reporting information under the requirements of a foreign jurisdiction, only where those requirements are substantially equivalent to the requirements that would otherwise apply to the reporting entity.
As of February 2015, the jurisdictions that ASIC considers to have implemented reporting Obligations Obligations In finance, an obligation is a financial responsibility where the terms of a contract must be met. Should an obligation between parties fail then the party who is at default may face legal action. In this scenario, the guilty party will not only have to agree to pay the set amount to fulfill the contractual arrangement but may also be responsible for covering all legal proceedings cost. Routine payments or outstanding debt of any kind are considered financial obligations, so if someone owes you In finance, an obligation is a financial responsibility where the terms of a contract must be met. Should an obligation between parties fail then the party who is at default may face legal action. In this scenario, the guilty party will not only have to agree to pay the set amount to fulfill the contractual arrangement but may also be responsible for covering all legal proceedings cost. Routine payments or outstanding debt of any kind are considered financial obligations, so if someone owes you Read this Term that are substantially equivalent to the derivative transaction rules (reporting) are:
- Canada;
- the European Union;
- Hong Kong;
- Japan;
- Singapore; and
- the United States.
On June 25, 2015, ASIC made a determination prescribing six overseas trade repositories. These are:
- DTCC Data Repository (U.S.) LLC
- Derivatives Repository Ltd
- DTCC Data Repository (Japan) KK
- DTCC Data Repository (Singapore) Pte Ltd
- UnaVista Limited, and
- the Monetary Authority appointed under section 5A of the Exchange Exchange An exchange is known as a marketplace that supports the trading of derivatives, commodities, securities, and other financial instruments.Generally, an exchange is accessible through a digital platform or sometimes at a tangible address where investors organize to perform trading. Among the chief responsibilities of an exchange would be to uphold honest and fair-trading practices. These are instrumental in making sure that the distribution of supported security rates on that exchange are effectiv An exchange is known as a marketplace that supports the trading of derivatives, commodities, securities, and other financial instruments.Generally, an exchange is accessible through a digital platform or sometimes at a tangible address where investors organize to perform trading. Among the chief responsibilities of an exchange would be to uphold honest and fair-trading practices. These are instrumental in making sure that the distribution of supported security rates on that exchange are effectiv Read this Term Fund Ordinance of Hong Kong.
This article was written by Patricia Tsang and Sophie Gerber (Director, TRAction Fintech, which provides services to report on behalf of OTC derivatives issuers).
Some OTC derivatives issuers must report to a trade repository licensed by ASIC. Currently, there is only one - the DTCC Data Repository (Singapore) Pte Ltd. However, some issuers have the option to report to a prescribed trade repository instead (ASIC prescribed six of these), subject to certain conditions. Whether an issuer may have the option depends on how the issuer is set up – whether it is:
- an Australian entity;
- a foreign subsidiary of an Australian entity where the Australian entity is an authorised deposit-taking institution (ADI) or an Australian financial services (AFS) licensee;
- a foreign ADI that has a branch located in Australia or;
- a foreign company that is required to be registered under Div 2 of Pt 5B.2 of the Corporations Act.
(1) Australian entity
An Australian entity includes a corporation, partnership, managed investment scheme or trust, incorporated or formed in Australia.
An Australian entity must report to a trade repository that is licensed by ASIC – currently, only the DTCC Data Repository (Singapore) Pte Ltd is licensed.
(2) Foreign subsidiary of an Australian entity...
...where the Australian entity is an ADI or an AFS licensee.
Such an entity can report to a licensed trade repository or a prescribed trade repository on an ongoing basis (subject to certain conditions being met) – see below.
(3) Foreign ADI that has a branch located in Australia
Such an entity can report to a licensed trade repository or a prescribed trade repository on an ongoing basis (subject to certain conditions being met) – see below.
(4) Foreign company
A foreign company that is required to be registered under Div 2 of Pt 5B.2 of the Corporations Act can report to a licensed trade repository or a prescribed trade repository on an ongoing basis (subject to certain conditions being met) – see below.
Prescribed trade repositories
For an entity referred to in (2), (3) or (4) above, such an entity has the option to report to a prescribed trade repository on an ongoing basis by reporting information under the requirements of a foreign jurisdiction, only where those requirements are substantially equivalent to the requirements that would otherwise apply to the reporting entity.
As of February 2015, the jurisdictions that ASIC considers to have implemented reporting Obligations Obligations In finance, an obligation is a financial responsibility where the terms of a contract must be met. Should an obligation between parties fail then the party who is at default may face legal action. In this scenario, the guilty party will not only have to agree to pay the set amount to fulfill the contractual arrangement but may also be responsible for covering all legal proceedings cost. Routine payments or outstanding debt of any kind are considered financial obligations, so if someone owes you In finance, an obligation is a financial responsibility where the terms of a contract must be met. Should an obligation between parties fail then the party who is at default may face legal action. In this scenario, the guilty party will not only have to agree to pay the set amount to fulfill the contractual arrangement but may also be responsible for covering all legal proceedings cost. Routine payments or outstanding debt of any kind are considered financial obligations, so if someone owes you Read this Term that are substantially equivalent to the derivative transaction rules (reporting) are:
- Canada;
- the European Union;
- Hong Kong;
- Japan;
- Singapore; and
- the United States.
On June 25, 2015, ASIC made a determination prescribing six overseas trade repositories. These are:
- DTCC Data Repository (U.S.) LLC
- Derivatives Repository Ltd
- DTCC Data Repository (Japan) KK
- DTCC Data Repository (Singapore) Pte Ltd
- UnaVista Limited, and
- the Monetary Authority appointed under section 5A of the Exchange Exchange An exchange is known as a marketplace that supports the trading of derivatives, commodities, securities, and other financial instruments.Generally, an exchange is accessible through a digital platform or sometimes at a tangible address where investors organize to perform trading. Among the chief responsibilities of an exchange would be to uphold honest and fair-trading practices. These are instrumental in making sure that the distribution of supported security rates on that exchange are effectiv An exchange is known as a marketplace that supports the trading of derivatives, commodities, securities, and other financial instruments.Generally, an exchange is accessible through a digital platform or sometimes at a tangible address where investors organize to perform trading. Among the chief responsibilities of an exchange would be to uphold honest and fair-trading practices. These are instrumental in making sure that the distribution of supported security rates on that exchange are effectiv Read this Term Fund Ordinance of Hong Kong.