International Swaps and Derivatives Association calls on ESMA to streamline EU trade reporting and end dual-sided reporting

The International Swaps and Derivatives Association (ISDA) published a derivatiViews commentary by Chief Executive Officer Scott O’Malia urging EU policymakers and the European Securities and Markets Authority (ESMA) to simplify derivatives and securities financing trade reporting, arguing current rules have created inconsistent and duplicative reporting that does not deliver complete, usable data for regulators. The article highlights cost and data-quality drivers identified in an industry response to ESMA’s request for feedback, including the requirement for both counterparties to report the same trade, overlapping obligations across the Markets in Financial Instruments Regulation (MIFIR), European Market Infrastructure Regulation (EMIR) and Securities Financing Transactions Regulation (SFTR), and frequent rule changes. ISDA supports a holistic review aimed at converging toward a single transaction report that meets multiple EU obligations, endorses ESMA’s proposed delineation by instrument type, backs removal of the dual-sided reporting model in favour of single-sided reporting, and calls for elimination of unnecessary or duplicative data fields, including information already available via legal entity identifiers and unique product identifiers. ISDA also argues that revised reporting requirements should be digitised for consistent implementation, citing its Digital Regulatory Reporting initiative and stating it will evolve DRR in line with future regulatory changes.