EBA, EIOPA and ESMA propose amendments to bilateral margin requirements
AI Analysis
On 2026-08-03, the European Supervisory Authorities (EBA, EIOPA and ESMA) published a final report containing draft Regulatory Technical Standards (RTS) to amend Delegated Regulation (EU) 2016/2251 on bilateral margin requirements under EMIR. The amendments would remove the obligation to exchange initial margin on both new and existing uncleared OTC derivatives for counterparties below the €8 billion initial margin threshold, simplifying the framework and aligning with other jurisdictions.
Key dates
- 2026-08-03
- ESAs publish final report and draft RTS proposing amendments to Delegated Regulation (EU) 2016/2251 bilateral margin requirements
Suggested considerations
- Compliance teams may wish to review current EMIR margin frameworks and inventories of uncleared OTC derivatives to identify portfolios and counterparties that are below the €8 billion initial margin threshold and could be affected by the proposed phase-out of initial margin exchange.
- Risk and collateral management functions should consider assessing the operational processes, documentation and systems currently used to calculate, call and exchange initial margin on legacy uncleared OTC derivative contracts, to understand the potential impact of a removal of these obligations on collateral flows and counterparty risk management.
- Legal and documentation teams may wish to map existing credit support annexes (CSAs) and collateral agreements to EMIR margin requirements, evaluating whether standard terms referencing Delegated Regulation (EU) 2016/2251 would need amendment if the RTS are endorsed and the obligation to exchange initial margin for below-threshold portfolios is removed.
- Regulatory affairs and policy teams should consider monitoring the European Commission’s endorsement process and subsequent scrutiny by the European Parliament and Council, tracking any changes to the draft RTS text that could affect scope, thresholds or transitional arrangements.
- Firms subject to EMIR in multiple jurisdictions may wish to compare the proposed EU treatment of below-threshold initial margin portfolios with requirements in other key jurisdictions (e.g. US, UK) to ensure consistent cross-border collateral and margin policies and avoid regulatory arbitrage or misalignment.
- Compliance teams may wish to prepare briefing materials for senior management and boards outlining the anticipated simplification and burden reduction, alongside any residual risks or supervisory expectations that could accompany the phase-out of initial margin for below-threshold counterparties.
What changed
Under the current EU bilateral margin framework in Delegated Regulation (EU) 2016/2251, counterparties with an aggregate average notional amount of non-centrally cleared derivatives below the €8 billion initial margin threshold specified in Regulation (EU) No 648/2012 (EMIR) are exempt from exchanging initial margin on new uncleared OTC derivative contracts, but must continue to exchange initial margin on existing contracts. The draft RTS proposed by the ESAs would amend this framework so that counterparties below the €8 billion threshold are no longer required to exchange initial margin for either new or existing uncleared OTC derivative contracts. The proposal is explicitly framed as a simplification and a facilitation of the phase-out of initial margin requirements for in-scope but belo
Compliance impact
The proposed RTS would materially reduce operational and collateral management obligations for EMIR in-scope counterparties below the €8 billion initial margin threshold, by removing the need to exchange initial margin on both new and existing uncleared OTC derivatives. The ESAs frame the impact as simplification and burden reduction rather than a tightening of requirements, but firms may still fa
Who is affected
Related regulations
AI-generated analysis. May contain errors or omissions — verify with the original EBA source before acting. Full disclaimer.
What the EBA said
The European Supervisory Authorities (EBA, EIOPA and ESMA – the ESAs) today published a final report on draft Regulatory Technical Standards (RTS), proposing to simplify the bilateral margin requirements of the European Commission’s Delegated Regulation (EU) 2016/2251.
Published by EBA . Read the full notice at the source for the authoritative text.