COVERED TRANSACTIONS: Derivative or derivative contract as defined at Article 2(5) EMIR.

Includes
options, futures, swaps, forward rate agreements and other derivative contract, both "OTC derivatives" and
derivative contracts the execution of takes place on a regulated market.
COVERED TRANSACTIONS (Exclusions): The definition of "derivative contracts" excludes:
1) Spot transactions (settle by T+2)
2) There are specific exclusions for commodity transactions, including:
Certain physically-settled commodity transactions;
Certain physically-settled transactions on exotic underliers;
3) Deposits or Loans.
EXTRATERRITORIAL APPLICATION:
Applicable to:
1) Non-EU branches of EU persons are treated in the same way as those EU persons; and
2) EU branches of third country entities. Third country entities may become subject to the clearing obligation
under EMIR where they deal in mandatorily clearable transactions with counterparties that are FCs or NFC+s.
Applicable when:
1)

those contracts have a direct, substantial and foreseeable effect within the EU

2)

where such obligation is necessary or appropriate to prevent the evasion of any provision of EMIR.

ESMA is required to produce draft technical standards specifying when a contract will be considered to have a
"direct, substantial and foreseeable effect within the EU" or where it is "necessary or appropriate to prevent
evasion". ESMA's draft technical standards identify three categories of transactions:
Where at least one counterparty is a third country entity benefiting from a guarantee provided by an FC;
Where both counterparties are EU branches of third country entities;
Where the primary purpose of the arrangement is to defeat the object, spirit or purpose of any provision of
EMIR that would otherwise apply.
REGISTRATION / LICENSING REQUIREMENTS: EMIR does not impose registration requirements for
counterparties to derivative contracts.
CENTRAL CLEARING: The European Commission and ESMA may produce technical standards specifying
which OTC derivatives shall be subject to mandatory clearing (once a CCP has been authorized or recognized to
clear those OTC derivatives).
Transactions in the relevant OTC derivatives between the following counterparty types will be clearable:

Two FCs;
An FC and an NFC+;
Two NFC+s;
An FC or NFC+ and a third country entity that would have been an FC or NFC+ if it had been established in
the EU;
Two third country entities that would have been FCs or NFC+s if they had been established in the EU
(provided that the contract has a direct, substantial and foreseeable effect within the EU or where it is
necessary or appropriate to prevent the evasion of any provisions of EMIR).

CENTRAL CLEARING (Historical trades): Certain trades entered into prior to the effective date of a clearing
requirement will be required to be submitted for clearing. This will be the case where the trade was entered into
after a CCP had obtained authorization to clear that type of transaction, and where the transaction exceeds a
minimum remaining maturity to be specified by ESMA.
CENTRAL CLEARING (Start Dates): The first OTC derivative contracts are currently expected to become
subject to the mandatory clearing obligation between summer 2014 and July 2015.
TRADE EXECUTION: EMIR does not impose mandatory venue execution requirements. ESMA shall determine
the classes of derivatives which will be subject to mandatory venue execution.
In order to become subject to the mandatory venue execution obligation, derivatives must be subject to the
clearing obligation under EMIR, admitted to trading or traded on at least one trading venue (regulated market,
MTF, OTF or equivalent third country venue) and sufficiently liquid to trade only on those trading venues.
TRADE REPORTING FCs, NFCs and CCPs must report all derivative contracts (OTC and exchange-traded,
cleared and uncleared) to an EU registered or non-EU recognized trade repository. If no trade repository is
available, reports must be submitted to ESMA.
EMIR does not specify which counterparty must report both counterparties are required to report, and to ensure
that reports are made without duplication. However, counterparties may delegate reporting to each other or to a
third party.
TRADE REPORTING (Back-loading) Counterparties must back-load derivative contracts entered into or
outstanding on or after Aug 16, 2012 (date of entry into force of EMIR). They are also subject to recordkeeping
requirements in relation to these derivative contracts.
MARGIN AND SEGREGATION REQUIREMENTS FOR UNCLEARED SWAPS FCs and NFC+s are required to
have risk-management procedures that require the timely, accurate and appropriately segregated exchange of
collateral with respect to OTC derivatives.
ESMA is expected to produce draft technical standards specifying the precise requirements for exchange of
collateral, implementing the BCBS IOSCO framework.
DOCUMENTATION REQUIREMENTS
Confirmations.
Portfolio Reconciliation.
Portfolio Compression.
Dispute Resolution.
Reporting to trade repositories.
Note: EMIR does not impose general requirements regarding relationship documentation. However, authorized
entities may already be subject to similar requirements (amongst others) under other legislation

ESMA: TECHNICAL ADVICE ON INDIA

Effective system for recognition of CCPs authorised under the legal regime of India: Not
equivalent.
CCP authorisation requirements: Equivalent, provided the CCP adopts legally binding
internal policies, procedures, rules, models and methodologies which comply with certain
requirements for CCPs under EMIR - ESMA identifies the following specific areas of
requirements:
(a) Organisational, including governance, compliance, audit etc;
(b) Requirements for senior management and Securities and Exchange SEBI of India;
(c) Risk Committee requirements for CCPs under Reserve Bank of India (RBI) supervision;

(d) Record keeping;

(e) Requirements for shareholders and members with qualifying holdings for CCPs under
RBI supervision;
(f) Requirements for the assessment of qualifying holdings for CCPs under RBI supervision;
(g) Conflict of interest requirements for CCPs under RBI;
(h) Business continuity;
(i) Outsourcing;
(j) General conduct of business requirements for CCPs under RBI supervision;
(k) Participation;
(l) Transparency;
(m) Segregation and portability;
(n) Exposure management requirements for CCPs under RBI supervision;
(o) Margin;
(p) Default fund;
(q) Other financial resources;
(r) Liquidity risk control;
(s) Default waterfall;
(t) Collateral;
(u) Investment policy;
(v) Default procedure;
(w) Review of models, stress testing and back testing; and
(x) Settlement.
The CCP must ensure that no changes are made to its internal policies, procedures, rules or
methodologies in a way which would mean that it would no longer comply with the standards
required by EMIR.

RELEVANCE OF ISDA PROTOCOLS/DOCUMENTS TO ICICI BANK

2013 EMIR NFC Representation Protocol (Mar 8, 2013) together with Form of Change of Status Notice (Sep 9, 2013)

Allows a party (including third country entities) to provide its counterparties with representations as to whether it is an NFC+
or NFC-. A third country entity will make the representation on the basis that it would or would not have been an NFC+ or
NFC- had it been established in the EU.

A party that is an FC can also adhere without making the NFC representation so that it can benefit from the representations
given by its adhering counterparties.

Also includes a mechanism for adherents to notify subsequent changes in status.

Relevance: Applicability of clearing and risk mitigation requirements for uncleared trades depend on status of parties.
2013 EMIR Portfolio Reconciliation, Dispute Resolution and Disclosure Protocol (Jul 19, 2013)
Addresses portfolio reconciliation and dispute resolution requirements. Also includes a disclosure waiver to permit compliance
with reporting and recordkeeping requirements without breaching confidentiality restrictions.
Relevance: all of the requirements addressed in the Protocol apply to the FC.
EMIR Timely Confirmation Amendment Agreement (Mar 8, 2013)
Allows parties to bilaterally agree on the allocation of obligations relating to the timely delivery and return of confirmations.
Relevance: all of the requirements addressed in the Agreement apply to the FC.
EMIR Reporting Guidance Note (Jul 19, 2013)
Allows parties to bilaterally agree on their reporting roles and obligations and the extent of the confidentiality waiver.
Relevance: all of the requirements addressed in the Note apply to the FC.
EMIR Portfolio Reconciliation Operational Guidance Note (Sep 10, 2013)
Provides guidance on the EMIR portfolio reconciliation and dispute resolution requirements.
Relevance: all of the requirements addressed in the Note apply to the FC.