Regulatory Alerts2018-08-17
Draft FSRA Joint Standard on Margin Requirements for Non-Centrally Cleared OTC Derivatives
The Financial Sector Conduct Authority and the Prudential Authority, with the South African Reserve Bank, published a draft joint standard prescribing margin requirements for non-centrally cleared over-the-counter derivative transactions under the Financial Sector Regulation Act, 2017. The standard establishes mandatory collateral frameworks to mitigate counterparty credit risk in bilateral derivative markets. Accompanying materials include a comments matrix, an impact assessment statement, and a formal invitation for public submissions under section 98(1) of the Act.
Financial Sector Regulation Act, 2017: Joint Communication 1 of 2018 – Draft FSRA Joint Standard on Margin Requirements for non-centrally cleared OTC derivative transactions 1 Ref.: 15/8 Financial Sector Regulation Act No 9 of 2017 Joint Communication 1 of 2018 DRAFT JOINT STANDARD ON MARGIN REQUIREMENTS FOR NON-CENTRALLY CLEARED OTC DERIVATIVE TRANSACTIONS The Financial Sector Conduct Authority and the Prudential Authority, acting with the concurrence of the South African Reserve Bank, today publish a draft joint standard which prescribes margin requirements for non-centrally cleared over-the-counter derivative transactions in terms of sections 106(1)(a), 106(2)(a) and (e) read with sections 107 and 109(2) of the Financial Sector Regulation Act, 2017 (Act No. 9 of 2017) (FSRA). The comments matrix, together with the draft Statement of the need for, expected impact and intended operation of the joint standard and the notice inviting submissions as contemplated in section 98(1) of the FSRA is also published with the draft joint standard. Requests for further information about the joint communication or draft joint standard may be submitted via email to michael.kabai@fsca.co.za or PA-Standards@resbank.co.za for the attention of Ms Lyle Horsley.