EMIR 3.0: RegEdge’s Practical Guide to the Upcoming Derivatives Reforms

The European Markets Infrastructure Regulation (EMIR) governs the oversight of over-the-counter (OTC) derivatives, central counterparties (CCPs), and trade repositories across the EU. Since its inception in 2012, EMIR has undergone several updates, including the EMIR Refit in 2019. The latest evolution, commonly referred to as EMIR 3.0, is poised to significantly reshape how derivatives are cleared and reported across the European Union.

EMIR 3.0 was adopted in late 2024, and firms are now preparing for phased implementation beginning in 2025. Key provisions, such as the Active Account Obligation, are expected to apply from June 25, 2025, with other requirements phased in through 2026, subject to ESMA’s technical standards.

The regulation is aimed primarily to increase the safety and efficiency of EU CCPs improving their attractiveness, encouraging clearing in the EU and enhancing the cross-border considerations of risk removing the over reliance on third country CCPs. This means that there will be direct impact on derivative counterparties.

Key Changes Under EMIR 3.0

Clearing: Active Account Obligation (AAO) for EU counterparties exceeding certain thresholds Clearing exemptions for third-country pension schemes and post-trade risk reduction services Updates to acceptable collateral for CCPs Improved transparency on margin requirements	Risk Mitigation and Margin: Transitional periods for newly in-scope NFC+ and FC+ entities crossing clearing thresholds Relief periods for daily valuation and margin exchange compliance Formalizing the margin exemption for stock and equity index options Rules for initial margin model validation (expected July 2025)
Transaction Reporting: Introduction of periodic penalty payments up to 1% of average daily turnover for persistent non-compliance Weekly net position reporting for NFC+ entities using intragroup exemptions Revisions to reporting requirements for NFC- trading relationships	Classification and Scoping: Updated clearing threshold calculations Revised definitions for intragroup transactions

Spotlight: Active Account Obligation (AAO)

The most substantial requirement is Active Account Obligation (AAO) commencing on 25 June 2025 which this blog will deep dive. Effective June 25, 2025, it requires certain EU counterparties to maintain a clearing account at an EU-authorised CCP for relevant derivatives.

Who Is In Scope?

Counterparties that are NFC+ or FC+, and which exceed the clearing threshold of €3bn in:

• Interest rate (IR) derivatives denominated in EUR or PLN

• Short-term interest rate (STIR) derivatives denominated in EUR

These firms must establish and maintain an active clearing account at an EU CCP unless they already clear 85% or more of their relevant trades at an EU CCP.

Please note, there is an exemption from the operational conditions and related reporting aspects of the “active account” requirement for an entity that, in any event, clears at least 85% of its derivative transactions in systemically important products at EU CCPs.

Active Account Obligation (AAO) Requirements

1. Active Account Functionality Requirements

Counterparties subject to the AAO must ensure that all the following conditions are met:

• A legally documented, permanently operational account with full IT connectivity and internal process readiness

• Systems and resources in place to handle high volumes at short notice, including trades moved from Tier 2 CCPs*

• Capability to route all new relevant trades through the EU account

* Tier 2 CCPs are third-country CCPs recognized by ESMA as systemically important to the EU (e.g., LCH Ltd, ICE Clear US).

2. Active Account Reporting Requirement

• Counterparties subject to the AAO must submit a report every six months to their competent authority, detailing their activity and risk exposure in relevant derivatives.

• The report must confirm that the active account is fully operational, including legal documentation, IT connectivity, and internal processes.

• Additionally, if the counterparty maintains accounts at a Tier 2 CCP for relevant derivatives alongside their EU active account, they must report on the systems and resources in place to manage potential risk transfers and maintain operational continuity.

3. Active Account Representative Clearing Requirement

• Applies to counterparties with a notional amount of at least €6bn cleared in relevant derivatives.

• These counterparties must show meaningful usage of their EU-authorised clearing accounts by clearing a minimum number of trades—called the “Relevant Number”—across each sub-category of “Representative Derivatives.”

• The specific thresholds and timelines for this obligation, including the “Reference Period,” will be detailed in ESMA's upcoming regulatory technical standards, expected by the end of 2025.

• Firms must remain compliant with the Active Account requirements starting from June 25, 2025, even before the final technical standards are issued.

RegEdge AAO Decision Tree

This decision tree illustrates the key questions that determine whether a counterparty is subject to the Active Account Obligation and its related reporting and representative clearing requirements. It’s designed as a practical visual aid to support compliance teams in navigating the rule efficiently.

1. Current Clearing thresholds - €3bn in:

   1. Interest rate (IR) derivatives denominated in EUR or PLN

   2. Short-term interest rate (STIR) derivatives denominated in EUR

2. AAR Categories

   1. Interest rate (IR) derivatives denominated in EUR or PLN

   2. Short-term interest rate (STIR) derivatives denominated in EUR

What Firms Should Do Now

• Assess exposure against new clearing thresholds

• Evaluate clearing splits across EU vs. non-EU CCPs to determine exemption eligibility

• Initiate account setup with EU-authorised CCPs if not already established

• Enhance systems to ensure scalability for AAO reporting and trade routing

• Engage compliance and legal teams to align documentation and governance

• Monitor ESMA technical standards, expected end of 2025, to fine-tune implementation

As the regulatory landscape continues to evolve, the window for proactive compliance is narrowing. EMIR 3.0 is not just a rule change—it’s a call for structural readiness. Whether you're just beginning to assess your exposure or knee-deep in implementation, having the right partners and playbook will make the difference.

RegEdge is here to help you navigate that journey—practically, pragmatically, and with precision. If you would like to discuss the active account requirement or any other aspect of EMIR 3 with us, please do get in touch.