Draft ICI Global Comment Letter to HK Authorities on Further Consultation on Reporting and Recordkeeping Obligations for OTC Derivative Transactions; Member Feedback Requested by Thursday, December 18
[28571]
December 12, 2014
TO: DERIVATIVES MARKETS ADVISORY COMMITTEE No. 86-14ICI GLOBAL MEMBERS No. 57-14
ICI GLOBAL TRADING & MARKETS COMMITTEE No. 4-14
INTERNATIONAL COMMITTEE No. 42-14 RE: DRAFT ICI GLOBAL COMMENT LETTER TO HK AUTHORITIES ON FURTHER CONSULTATION ON REPORTING AND RECORDKEEPING OBLIGATIONS FOR OTC DERIVATIVE TRANSACTIONS; MEMBER FEEDBACK REQUESTED BY THURSDAY, DECEMBER 18
Recently, the Hong Kong Monetary Authority (“HKMA”) and the Securities and Futures Commission (“SFC”) issued a paper on reporting and recordkeeping rules for OTC derivative transactions. [1] The Consultation Paper includes a summary of comments received on the proposals for the mandatory reporting and related recordkeeping requirements for OTC derivatives, [2] the HKMA and the SFC’s responses to those comments, their conclusions, and a request for further comment on three particular matters.
In the draft letter, ICI Global addresses one of the matters raised by the HKMA and the SFC for further consultation – the proposal to define products traded on US swap execution facilities (“SEFs”) and EU multilateral trading facilities (“MTFs”) as “OTC derivatives,” which would subject these products to the Hong Kong (“HK”) reporting and recordkeeping rules. The letter argues that these types of transactions should not be included in the definition of “OTC derivatives” and be subject to the HK reporting requirements.
A copy of the draft comment letter is attached for your review. If you have any comments on the draft comment letter, please provide them to Jennifer Choi at jennifer.choi@ici.org.
We are requesting member comments by Thursday, December 18.
Jennifer S. Choi
Senior Associate Counsel Securities Regulation
endnotes
[1] Consultation Conclusions and Further Consultation on the Securities and Futures (OTC Derivative Transactions – Reporting and Record Keeping Obligations) Rules (November 2014), available at http://www.sfc.hk/edistributionWeb/gateway/EN/consultation/conclusion?refNo=14CP6 (“Consultation Paper”). For a summary of the Consultation Paper, see ICI Memorandum No. 28545 (Dec. 2, 2014), available at http://www.ici.org/my_ici/memorandum/memo28545.
[2] Consultation paper on the Securities and Futures (OTC Derivative Transactions – Reporting and Record Keeping) Rules (July 2014), available at http://www.sfc.hk/edistributionWeb/gateway/EN/consultation/openFile?refNo=14CP6 (“Original Consultation”). For a summary of ICI Global’s comment letter on the Original Consultation, see ICI Memorandum No. 28349 (Aug. 28, 2014), available at http://www.ici.org/my_ici/memorandum/memo28349.