The treasury consultancy and IT solution specialist Treamo Business Consult-ing is developing a reporting platform for corporates affected by EMIR (European Market Infrastructure Regulation).
EMIR? Even several months after this EU-wide reporting obligation came into force, many players in the market are still unsure how EMIR will impact on them. EMIR will apply to all so-called financial counterparties (e.g. banks) and all corporates that hold even a single derivative-based instrument in their accounts - and this regardless of whether this is contracted with an external or a Group-internal counterparty. These derivative instruments must in future be reported to a central trade repository. Just a few months before this obligation comes into effect, many corporates still don't know what they will have to report and to whom.
Major information vacuum
According to Martin Sadleder, Managing Director of Treamo Business Consulting, there still exists a major information vacuum. This applies less to the 'big players', but EMIR is an issue which will sur-prise many small and medium-sized enterprises. He has an explanation for this: ‘EMIR and its im-pacts on corporates have been and continue to be downplayed and seldom mentioned in the com-munication of industry representative bodies and banks, which has led to EMIR obviously being underestimated. For a bank to say to a customer that it will take care of the issue falls short of reality.’ In the course of its development work on EMIRate, Treamo conducted in-depth research and obtained results which were in part astonishing: ‘A search for the term EMIR on the websites of banks or system providers hardly generates any hits. Given the fact that EMIR will lead to far-reaching changes, we were very surprised.’
Communication, on the one hand, and EMIRate as a technical solution on the other With EMIRate, Treamo offers a solution which represents a comprehensive 'care-free' package for users. Despite this, there is also still some communication work which needs to be done here. Sadleder: ‘Every Group-internal derivative instrument needs to be reported, even if it is only a simple forward rate agreement. The banks can't help here.’ In addition to its technical solution, Treamo is also launching an information campaign in order to ensure that EMIR not only receives the attention it warrants, but also that its far-reaching implications are understood in the period remaining until its implementation.
EMIRate - not 'software' in the classical sense, more a user-friendly 'solution package'
Treamo already has experience in the area of offering software as a service, for example with TFM, an application for cash flow forecasting and treasury reporting. The reporting obligation associated with EMIR is effectively a classical case calling for a SaaS solution," Sadleder claims. ‘Besides the facts that EMIR means not only additional unprofitable work for corporates but is also associated with costs, companies need a solution which can reliably take over some of their work. EMIRate and its attractive pricing model, which is solely based on the scope of use, represent a solution which is currently unmatched in the market.’
Trade repositories yet to be defined
Sadleder does not regard the fact that the ESMA (European Securities and Markets Authority) has as yet not defined the trade repositories as a real issue. ‘This is just one of several somewhat strange aspects associated with the launch of EMIR. Either way, it is not particularly relevant for EMIRate to whom these reports ultimately have to be sent - from a technical perspective, this will only necessitate insignificant modifications if any.’