Insurance Europe: Feedback provided on EC proposal for changes to EMIR

25 July 2017

Insurance Europe has provided feedback to the European Commission on its proposal for amending key areas of the European Market Infrastructure Regulation (EMIR) regulation.

Insurance Europe welcomes the recent EC proposal amending EMIR and in particular the following changes: 

However, Insurance Europe believes that several concerns raised by the insurance industry in the past with respect to EMIR are still outstanding and should be addressed as part of this review. These include:

In addition, the industry remains concerned by the practical application of EMIR, which requires insurers to post cash when centrally clearing. As highlighted in the past, the industry has significant concerns over the potentially high need for cash to cover variation/initial margin needs.

While EMIR recognises the cash challenge faced by pension scheme arrangement (PSA), it fails to recognise that the same challenge applies to all insurers with long-term business. Insurance Europe welcomes the EC’s decision to delay variation margin posting obligations on PSAs.

Furthermore, it welcomes the proposed mandate for the European Supervisory Authorities (ESAs) and the ESRB to investigate and assess whether further measures are necessary to facilitate clearing solutions for PSAs. Insurance Europe looks forward to contributing to this work, and believes that any investigations should also cover the concerns of the insurance industry and any solutions found should also be considered for the insurance industry.

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