On Feb. 5, the Hong Kong Monetary Authority and the Securities and Futures Commission released the final version of the mandatory clearing rules for interest rate swaps as well as a paper discussing the changes it made to the rules in response to comments submitted by market participants during the consultation process.
Under the final rules, the first phase of mandatory clearing, which will apply only to dealer-to-dealer trades, will take effect in September 2016. In practical terms, this means that trades will be subject to mandatory clearing from July 2017 onwards.
The two regulators also released final rules expanding mandatory reporting to other asset classes and expanding the scope of the information that must be reported. Under these rules, transactions in derivatives based on certain types of derivatives based on interest rates, FX, equities, credit and commodities will have to be reported. These reporting requirements will commence in July 2017, seven months later than originally proposed.
