In response to the role played by over-the-counter (OTC) derivatives in the 2008 financial crisis, the U.S. and the EU each took steps to mitigate risks associated with OTC derivatives trading. The U.S. reforms were embodied in the Dodd-Frank Act. See “Dechert Webinar Highlights Key Deal Points and Tactics in Negotiations between Hedge Fund Managers and Futures Commission Merchants regarding Cleared Derivative Agreements
,” Hedge Fund Law Report, Vol. 6, No. 16 (Apr. 18, 2013). Similarly, in 2012, the EU adopted its own OTC Derivatives reforms, known as the European Market Infrastructure Regulation (EMIR). Implementation of Dodd-Frank’s OTC derivatives regulations and the EMIR regulations continues to take shape, with several important compliance and effective dates on the horizon. With this in mind, a recent webinar presented by Dechert LLP provided a timely and detailed discussion of: the current state of implementation of EMIR; certain newly-effective EMIR risk mitigation requirements; implementation of Dodd-Frank’s central clearing and trade execution mandates and their extraterritorial application; and the significant similarities and differences between the U.S. and EU derivatives reforms. This article summarizes the key insights from that webinar. The speakers were Dechert partners Abigail Bell, Richard Frase
and M. Holland West.