The Bank of Russia published its final report concerning the OTC derivatives market reform

The final report of the regulator was prepared taking into account the comments of the financial market participants regarding phased implementation of the requirement for mandatory central clearing of standardised OTC derivatives.

It is suggested that the central clearing will be mandatory for the limited scope of standardised derivatives and only for the transactions between Russian counterparties. At the first stage (from 1 January 2018) the requirement will apply to credit institutions,  management companies for investment funds, unit investment funds, or non-governmental pension funds and to dealers, brokers and securities managers. From 1 January 2019 these rules will also apply to the other derivatives market participants, provided they have reached certain threshold, calculated on the basis of the volume of their outstanding OTC derivatives.

The requirement for central clearing of standardised OTC derivatives is aimed at increasing the stability of the financial market as a whole. According to the decisions adopted by the leaders of the G20, analogous regulation has already been implemented in the USA, the EU, China, Japan and other countries.

The discussions in respect of the consultation paper, which had preceded the final report, took place from 1 July to 15 September 2016. In addition to collecting written comments, the Bank of Russia also had on-site consultations with the representatives of professional community. Those who participated in the discussions noted the relevance of the proposed changes and generally supported the Bank of Russia’ initiatives.