Policy & Regulation

Energy industry holds breath ahead of EMIR review

Firms hope the review of the European Market Infrastructure Regulation will leave the hedging exemption for mandatory clearing untouched Firms hope the review of the European Market Infrastructure Regulation will leave the hedging exemption for mandatory clearing untouched.
By Andreas Walstad 16 March 2017 0 25073
EMIR is one of several financial regulations drawn up in response to the financial crisis. (European Commission)

The European Commission is expected to conclude its review of the European Market Infrastructure Regulation (EMIR) this spring, with the developments being closely monitored by stakeholders in the energy sector. 

The energy industry is well aware any changes to the ‘hedging exemption’ could expose more firms to costly and burdensome clearing obligations for over-the-counter (OTC) derivatives trading. 

First adopted in 2012, EMIR enforces clearing obligations for OTC derivatives transactions, meaning counterparties pay cash up front – or collateral – to a clearing house in case one of...