GFMA Briefing Note - Treatment of FX Instruments Under EMIR
3 December 2010
The Global FX Division authored a briefing note on the European Commission's proposed regulation on OTC derivatives, central counterparties and trade repositories, specifically in regards to the treatment of FX instruments under EMIR.
This note sets out the position of the Global FX Division of AFME, SIFMA and ASIFMA regarding the treatment of FX instruments under the proposed regulation covering OTC derivatives, central counterparties and trade repositories, commonly known as EMIR.
With a turnover of some EUR2.9 trillion / US$4 trillion per day the FX market is the world’s largest financial market. It is the means by which cross border payments are effected and currency risk is managed in the world’s financial system. It differs from the OTC derivative markets in that it has many more participants and transactions, which are much simpler and short term. We are therefore concerned with treating the vast majority of FX transactions, which are simple exchanges of currency, as if they are “derivatives”.