ESMA Supervisory Briefing on AAR Representativeness Obligation

ESMA has issued a supervisory briefing to clarify the representativeness obligation linked to the active account requirement (AAR) for counterparties. The briefing outlines ESMA's supervisory expectations for compliance and reporting, focusing on how counterparties should identify the most relevant subcategories of derivatives and report trades to reflect their activity at Tier 2 CCPs. This guidance aims to promote supervisory convergence and address increased scrutiny on this obligation.

Counterparties subject to the AAR representativeness obligation must adhere to the guidance provided in this briefing to meet their regulatory requirements. This includes understanding how to correctly identify relevant subcategories and report trades. Failure to comply with these obligations, as clarified by ESMA, could lead to supervisory action. The document serves as a key resource for ensuring compliance with the AAR representativeness rules.