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Warsaw, 13 July 2020

KDPW Launches the SFTR Trade Repository Service

KDPW has launched the trade repository service for securities financing transactions (SFTR trade repository). The new reporting obligations are imposed by the European Union’s Securities Financing Transactions Regulation (SFTR). The SFTR requires the reporting of SFT (securities financing transaction) details to authorised trade repositories as an obligation of all market participants, including financial and non-financial entities.

As of 13 July 2020, the obligation of reporting SFTs to authorised trade repositories applies to investment firms, banks, credit institutions, CSDs and CCPs. The reporting obligation took effect on 13 July 2020. It was originally expected to take effect on 13 April 2020; however, due to the coronavirus pandemic, the effective date was postponed by ESMA (European capital market regulator).

SFT examples:
  • securities lending and borrowing;
  • repos and reverse repos in securities and guaranteed rights;
  • buy-sell-back and sell-buy-back transactions in securities, commodities, and guaranteed rights;
  • collateral management transactions.

As of 7 May 2020, ESMA extended the registration of the KDPW trade repository to include the reporting of transactions under the SFTR. KDPW, which has operated a trade repository under EMIR for a number of years, has the necessary experience, expertise, resources, and a range of technological and procedural solutions to collect and maintain trade reports.

The complementary services offered by KDPW provide participants of the trade repository (both under SFTR and EMIR) with a range of key benefits offered by KDPW’s existing communication interfaces, the option of meeting both reporting obligations in a single trade repository, reduction of the workload, the availability of off-the-shelf technology solutions and expert support, as well as an attractive price list which largely reduces the cost of the reporting obligations.

The SFTR ensures that European supervisory authorities have access to details of securities financing transactions and aims to improve risk monitoring tools, which should improve the safety of the financial markets.

Each entity trading in SFT is required to hold a legal entity identifier (LEI) used in reporting. As an LOU accredited by the GLEIF, KDPW offers the LEI issuance and maintenance service.

Who is required to report SFT details to authorised trade repositories?
The obligation of reporting SFT to authorised trade repositories applies to all business entities in the European Union, including both financial and non-financial entities (irrespective of the business sector).
The reporting obligation is effective as of 13 July 2020 for:
  • investment firms,
  • banks,
  • credit institutions,
  • CSDs and CCPs.
The reporting obligation will take effect as of 12 October 2020 for:
  • insurance/reinsurance establishments,
  • pension funds,
  • UCITS (undertakings in the collective investment in transferable securities),
  • AIF (alternative investment funds).
The reporting obligation will take effect as of 11 January 2021 for:
  • non-financial institutions.
Last modified: 21-07-2020 Go up