Introduction to the EMIR Clearing requirements
Under the European Markets Infrastructure Regulation (EMIR), financial counterparties and certain non-financial counterparties with large derivatives exposures have to clear derivatives contracts subject to the clearing obligation when traded Over-the-Counter (OTC) with effect from the relevant clearing start date.
Important information for Non-Financial Counterparties (NFCs)
The EMIR Clearing obligation does not apply to 'Non-Financial Counterparties below the clearing thresholds' or 'NFC-'.
Whereas NFC+ were previously required to clear derivative transactions across all asset classes when they exceeded any of the clearing thresholds, EMIR REFIT requires NFC+ to only clear new and novated derivatives subject to the EMIR clearing obligation in the asset class where it exceeds the clearing threshold.
Small Financial Counterparties (FC-) are not subject to the EMIR clearing obligations. They remain however subject to all other EMIR obligations that apply to Financial Counterparties, such as margin requirements for uncleared derivatives, risk mitigation techniques and reporting.
Large Financial Counterparties (FC+) must clear new and novated derivative contracts subject to the clearing obligation across all asset classes.
For more information on counterparties and the classification thresholds as defined by EMIR go to the HSBC EMIR Overview page.