New OTC Regulatory Regime unveiled in Singapore
Implementation of the reporting regime carried out in Phase 1A recently started on 3 February 2014 for selected banks. Phase 1B starts in April 2014 for all banks. Phase 1C covers certain other financial entities and Phase 1D will begin in October 2014 for other significant derivatives holders to comply with certain reporting requirements. Such requirements include information on the contract, counterparty, clearing and other transactional data.
Significant derivatives holders (SDH) are defined as persons satisfying all the following requirements on the last day of any quarter:
• They are not entities as mentioned above in Phrases 1 and 2;
• They are resident in Singapore; and
• The aggregate gross notional amount, for the year ending on the last day of the quarter, of the “specified derivatives contracts” to which they are parties and are booked and/or traded in Singapore exceeds S$8billion.
Firms should assess whether they fall under the reporting categories of the above entities or are exempted from reporting. All Capital Market Services Licence holders are not exempt from the OTC reporting requirements if they trade OTC, but certain fund managers who are not deemed SDHs may possibly be exempted.