On July 8, ISDA, the Alternative Investment Management Association (AIMA), the European Fund and Asset Management Association (EFAMA) and the Securities Industry and Financial Markets Association’s asset management group (SIFMA AMG) have submitted a letter to the European supervisory authorities (ESAs) and the European Commission on initial margin (IM) model approval requirements set out in the European Market Infrastructure Regulation (EMIR 3.0). The letter highlights challenges posed by the three-month period granted to the European Banking Authority and national competent authorities (NCAs) to validate changes to an IM model and describes how the ISDA Standard Initial Margin Model (ISDA SIMM) schedule can be amended to address these issues.
The letter also recommends that phase five and six firms should be able to meet the IM model approval requirement by notifying their NCA that they will be using a pro-forma IM model (such as the ISDA SIMM). NCAs may request further information or block a firm’s use of a model, but these entities should be able to use the pro-forma IM model once they have notified their NCA, assuming no express disapproval.
Documents (1) for Trade Associations Submit Letter on EMIR IM Model Validation
Latest
The CPI Quandary
The recent US government shutdown didn’t just create weeks of political drama – it also left inflation-linked swaps dealers with a major headache: how should they determine an initial value for new trades given the US Bureau of Labor Statistics...
ISDA Response to HMT, BoE on UK CCPs
On November 18, ISDA submitted its responses to the Bank of England (BoE) consultation on ensuring the resilience of central counterparties (CCPs) and the UK Treasury’s (HMT) two draft CCP statutory instruments (SIs). These consultations form part of the update...
Doubling Down on Appropriate Trading Book Capital
Throughout ISDA’s 40th anniversary year, we’ve been reflecting on the quest for greater consistency and efficiency that underpins everything we’ve achieved since 1985. It was at the heart of the original efforts to bring greater standardization to the nascent derivatives...
Determining Initial Reference Index for New Trades
On November 25, 2025, ISDA published a Market Practice Note (MPN) to recommend a specific methodology that market participants could elect to use for the purposes of determining the Initial Reference Index for certain new inflation derivative transactions given that...