Email Contact Phone Company Visit Website

New York, USA Office

605 Third Avenue
New York

Boston, USA Office

320 Congress Street 7th Floor

New Jersey, USA Office

2 Journal Square Plaza
Jersey City

Denver, USA Office

4725 Independence Street
Wheat Ridge

Toronto, Canada Office

4 King Street West

London, UK Office

193 Marsh Wall

Frankfurt, Germany Office

Mainzer Landstraße. 211
Frankfurt am Main

Hyderabad, India Office

Adjacent to Cyber Towers, Hi-Tec City, Madhapur,

Hong Kong Office

5th FloorRutonjee HouseRuttonjee Centre11 Duddell Street

Tokyo, Japan Office

10/F Kojimachi KS Square5-3-3 Kojimachi, Chiyoda-ku

Sydney, Australia Office

Mezzanine Suite 150 Margaret Street

White Plains, NY USA Office

10 Bank Street, Suite 880
White Plains

Singapore Office

8 Robinson Road# 09-00 ASO BuildingSingapore 048544
Singapore District

South Africa Office

8th Floor, Fredman Towers13 Fredman DriveSandown 2196South Africa

Mississauga, Canada Office

5970 Chedworth Way

Czech Republic Office

Trojanova 18120 00 Prague 2

Headquarters Head Office

5 Dakota Drive
Lake Success

Amsterdam Office

Unit 1AJ Ernststraat 199


+44 207 551 3000


[email protected]
Back to all Broadridge Financial Solutions announcements

EMIR Refit Regs Raise Risk of Fines

EMIR Refit: 69% of firms expect serious challenges when building up matching, reconciliation and exception management capabilities.

The incoming EMIR Refit regulation will increase sell-side and investment firms’ reporting requirements to a level where submitting new data fields and new combinations of actions and events could cause significant delays and run the risk of fines, a study from Acuiti has found.

Acuiti’s new report, 'EMIR Refit: Navigating the mandatory changes', sponsored by Broadridge Financial Solutions, details how regulatory reporting teams face significant challenges in complying with the new regulation.

Furthermore, companies have often found themselves operating with a lack of clarity on how the new framework will impact their reporting processes. This increases the risk of errors, which adds to teams’ burdens when they have to explain breaks to regulators.

The findings highlight the importance of developing robust systems for trade and transaction reporting, and for the correction of errors.

The study found that 69% of firms were expecting serious challenges when building up their matching, reconciliation and exception management capabilities. All respondents envisioned some level of challenge in correcting errors and resubmissions.

“Regulatory reporting regimes have long been a slog to implement for firms, creating lots of potential cost with little to gain in competitive edge. EMIR Refit looks set to be no different, with compliance preparations still hindered by a lack of clarity on how the regulation will fit with other jurisdictions’ frameworks,” says Ross Lancaster, Head of Research at Acuiti. “Nevertheless, there is no alternative to upgrading or replacing systems for compliance. Firms will be well served by increasing their analytical capabilities to continuously assess what causes inevitable reporting errors and how to adjust processes accordingly. This can improve internal functionality while also minimising the risk of fines.”

“Given the complexity and scope of reporting requirement changes that will impact industry participants over the next two years, firms face significant operational challenges in updating their systems to comply,” said Hugh Daly, Broadridge’s general manager responsible for regulatory transaction reporting solutions. “This opens the door to innovation, with the opportunity to improve how reporting systems function from a more strategic, multi-jurisdictional or multi-regional perspective.”

Acuiti surveyed and interviewed regulatory reporting executives at 40 sell-side firms on their preparations for EMIR Refit and experiences with other reporting regulations.
The key findings were:

• EMIR Refit will strain resources, with concerns that both budget and staffing issues will challenge some firms’ capacity to comply
• The increase in data fields and fields for mandatory matching will make reconciliation a major issue for firms
• Errors and issues with reconciliation breaks can be solved with the right exception management infrastructure
• Firms are expecting Unique Transaction Identifier implementation to be complicated, with pairing and sharing highlighted as a particular pain point
• Ambiguity on how to interpret some new fields, such as for lifecycle events, is heightening the risk of breaks between counterparties
• Integrating ISO 20022 is expected to be a relatively smooth part of the EMIR Refit implementation
• The experience of implementing previous regulatory reporting regimes is driving greater engagement with, and higher expectations of, third-party solution suppliers and professional services providers that can help their EMIR Refit processes

The report also found that firms are facing significant resource constraints in amassing the expertise and infrastructure to meet the challenges posed by EMIR Refit. This has added to the difficulties of controlling the amount of budget devoted to regulatory reporting, which can eat into other investment plans.

Some of the problems thrown up by EMIR Refit can also be found in other jurisdictions, which are rolling out their own new reporting regimes. This promises to make the coming years an exceptionally busy time for reporting teams.

Download the full report: