On May 27, ISDA sent a letter to the European Commission (EC) and the European Securities and Markets Authority (ESMA) to highlight several technical issues arising from the interaction between the delegated regulation (EU) 2025/1003 on identifying reference data to be used for over-the-counter (OTC) derivatives for the purposes of public transparency and the draft regulatory technical standards for derivatives transparency (RTS 2) and from areas of the draft RTS 2 that lack clarity.

ISDA welcomes both the delegated regulation and the revised transparency framework proposed under the draft RTS 2 as necessary and proportionate and considers they will together provide an enhanced level of public transparency for OTC derivatives.  However, mismatched dates of application of the delegated regulation and the draft RTS 2 create some legal uncertainty and regulatory risk for market participants.  In addition, there are several areas of limited or unclear information in the draft RTS 2 and inconsistency between it and the delegated regulation, which will cause implementation issues if not addressed.  ISDA’s letter to the EC and ESMA analyses each of these issues and provides proposed solutions.