Many financial and non-financial firms located in the EU are in a race to meet the first compliance deadline of the European Markets and Infrastructure Regulation (EMIR), PwC has announced.

EMIR legislation requires all derivative transactions (listed and OTC) to be reported to EMIR trade repositories, the clearing of all OTC derivatives with EMIR authorised central counterparties and also for firms to conduct clearing-like operational risk management processes. PwC has warned however that the 15 March deadline may be too soon.

PwC regulation partner Crispian Lord said: “The complexity of these new obligations, and the short timeframe in which firms have to comply, mean that many firms just aren’t ready for this Friday’s deadline. Regulatory fatigue is also a factor as many firms are being hit by an unprecedented amount of new post reform regulation to implement and comply with.

“Regulators may well take a pragmatic view of firms which are not compliant by the deadline, however, they will require firms to provide evidence that they are acting in good faith and doing everything they can to comply as soon as practically possible.”

Many industry figures fear that these new requirements will contribute to global liquidity shortage, increase the cost of trading and concentrate systemic risk in central counterparties.

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