Grygo is the chief content officer for FTF & FTF News.
It looks as if participants in the European over-the-counter (OTC) derivatives markets — particularly banks — are ready to meet their Unique Product Identifier (UPI) regulatory reporting requirements, according to the Derivatives Service Bureau (DSB).
“The European Union will implement UPI reporting from 29 April 2024 as the second G20 jurisdiction, following the U.S. who went live from 29 January 2024, and ahead of the UK effective date in September 2024,” DSB officials say. The UPI reporting requirements are part of the EU EMIR Refit Regulation.
“The UPI Service was launched on 16 October 2023 as a result of ongoing collaborative efforts involving industry stakeholders, [and] global regulatory bodies,” DSB officials remind.
The DSB serves as the UPI Service Provider, and more than 1 million UPIs have been created and made accessible to users, DSB officials say. “UPIs are categorized by asset class, with volumes regularly reported.”
“The next jurisdiction to roll out UPI reporting will be the U.K. on 30 September 2024, followed by Australia and Singapore from 21 October 2024 and Japan from 7 April 2025. In addition, the Hong Kong authorities, HKMA and SFC, are consulting on the OTC derivatives reporting regime, proposing mandatory UPI reporting from 29 September 2025,” the DSB adds.
“Overall, the DSB user onboarding data reveals that European organizations are prepared to meet their UPI regulatory requirements, having seen a steady increase in E.U.-headquartered firms joining the service,” DSB officials say.
“Currently, 246 firms have subscribed to the UPI Service across various fee-paying user types, including 122 programmatic users. This represents an increase of over 100 organizations subscribing to the UPI Service since the US compliance date,” according to the DSB.
Of the compliant organizations, “banks constitute the largest entity group at 44 percent, with other participants such as trade execution platforms — SEF [swap execution facility], clearinghouses, brokerages, trade repositories, and data management providers also onboarded,” according to the DBS. “Approximately 33 percent of the onboarded organizations have their headquarters based in the E.U. Quarterly updates on UPI user numbers are available on the DSB website Fee Model Variables page.”
DSB adds that the E.U. UPI reporting “will be complementary to the existing ISIN for OTC derivative reporting, which is important to price transparency and market abuse detection under MiFIR, and for aggregating OTC derivatives data under EMIR,” officials say. “This means that the E.U. (and the U.K.) will be reporting the OTC ISIN where the EMIR scope aligns with MiFIR, with the UPI being reportable for those derivatives that are part of the broader scope of EMIR.”
The intentionally complementary design of the two identifiers means that “UPI data attributes and the UPI code itself are included in the OTC ISIN record,” DSB officials say.
“Organizations using the OTC ISIN can leverage established workflows and connectivity for integration of the UPI, ensuring global convergence and harmonization. This is an integral component of the EU’s approach, designed to establish cross-regulation consistency and lower reporting burdens for firms,” officials add.
This second UPI compliance milestone is a sign of “the momentum of G20 jurisdictions fulfilling commitments made after the financial crisis, contributing to the ongoing efforts to enhance global systemic risk monitoring through the aggregation of OTC derivatives data,” says Emma Kalliomaki, managing director of ANNA and the DSB, in a prepared statement.
Emma Kalliomaki
“As UPI reporting deadlines approach, firms can prepare for their reporting obligations by using the DSB’s scalable client onboarding and support platform. The platform enables timely onboarding to the UPI Service offering a range of efficient connectivity and service options that facilitate seamless access to UPIs across all products,” DSB officials say.
The DSB is a subsidiary of the Association of National Numbering Agencies (ANNA), which governs the International Organization for Standardization (ISO) principles and promotes ISIN, FISN, and CFI codes for financial instruments.
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