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26 April 2018

FSB publishes second consultation on unique product identifier governance


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The consultation sets out proposals for the governance arrangements for a global UPI, as a key harmonised identifier designed to facilitate effective aggregation of transaction reports from over-the-counter derivatives markets.


G20 Leaders agreed at the Pittsburgh Summit in 2009, as part of a package of reforms to the OTC derivatives markets, that all OTC derivatives transactions should be reported to trade repositories.1 A lack of transparency in these markets was one of the key problems identified by the financial crisis. Trade reporting, by providing authorities with data on trading activity, is a key part of efforts to identify and address financial stability risks from these markets.

The primary purpose of the UPI is to identify the product that is the subject of an OTC derivatives transaction. The Committee on Payments and Market Infrastructures (CPMI) and the International Organization of Securities Commissions (IOSCO) published their finalised technical guidance on the UPI in September 2017. Under the Technical Guidance, a unique UPI code would be assigned to each distinct OTC derivative product and would map to reference data elements with specific values that together describe the product. To use the data from trade reporting effectively, it is important for authorities to be able to aggregate reporting not only to consider institution-specific risks but also to consider system-wide risks.

Today’s FSB consultation document asks additional targeted questions to assist the FSB in reaching conclusions on aspects of the governance arrangements for the UPI system. Topics include fee models and cost recovery, intellectual property, standardisation, competition among UPI Service Providers and arrangements for a UPI Reference Data Library. The FSB expects to reach conclusions on these issues and to designate one or more UPI Service Providers by mid-2019.

The FSB welcomes comments and responses to the questions set out in the consultation by 28 May.

Full consultation



© FSB - Financial Stability Board


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