MAR 12 Post-trade risk reduction services

This chapter applies to:

1. (1)

   post-trade risk reduction service providers;

2. (2)

   relevant financial counterparties;

3. (3)

   relevant non-financial counterparties;

4. (4)

   third country investment firms;

5. (5)

   firms subject to COBS 11.2A; and

6. (6)

   transparency investment firms and trading venue operators subject to transparency obligations.

A relevant obligation does not apply in respect of a transaction carried out as part of an eligible post-trade risk reduction service.

The transparency obligations do not apply in respect of a transaction carried out as part of an eligible post-trade risk reduction service.

A PTRRS meets the criteria for the purposes of MAR 12.2 and MAR 12.3 where it:

1. (1)

   is provided by a post-trade risk reduction service provider which is not:

   1. (a)

      affiliated to the market participants to whom the service is provided; and

   2. (b)

      a party to a transaction resulting from the PTRRS ;

2. (2)

   is operated on the basis of non-discretionary rules set in advance by the post-trade risk reduction service provider that are based on specified parameters; and

3. (3)

   results in a transaction that binds all the participants.

A post-trade risk reduction service provider must perform a PTRRS in accordance with an eligible agreement.

1. (1)

   A post-trade risk reduction service provider must make public in relation to its service of portfolio compression:

   1. (a)

      the total number of transactions and aggregate volume submitted for compression; and

   2. (b)

      the total number of transactions and aggregate volume of derivatives terminated or modified.

2. (2)

   A post-trade risk reduction service provider must make public in relation to its PTRRS, other than portfolio compression:

   1. (a)

      the total number of new derivatives transactions; and

   2. (b)

      the value of these transactions expressed in terms of aggregate volume.

3. (3)

   A post-trade risk reduction service provider must make public the information in (1) and (2) no later than the close of the following business day after a risk reduction has been completed.

A post-trade risk reduction service provider must maintain complete and accurate records of all the PTRRS which they organise or participate in and make the records available to the FCA promptly upon request.

A person must, prior to providing a PTRRS for the first time, notify the FCA of:

1. (1)

   its intention to rely upon the exemption in MAR 12.2.1R and MAR 12.3.1R ;

2. (2)

   the details of each type of eligible post-trade risk reduction service that it provides; and

3. (3)

   a variation in the type of eligible post-trade risk reduction service it provides.

A post-trade risk reduction service provider must notify the FCA prior to ceasing to provide an eligible post-trade risk reduction service.