EMIR (European Market Infrastructure Regulation)

Transcription

1 EMIR (European Market Infrastructure Regulation) Dear Varengold-Client, The European Market Infrastructure Regulation ("EMIR") became effective on 15 September These obligations apply to you as a Counterparty subject to EMIR. This means that we need you to: (1) tell us whether you are a financial or a non-financial counterparty (and whether or not you are above the clearing threshold) (as those terms are defined in EMIR) and (2) agree, among others, portfolio reconciliation and dispute resolutions procedures and Provisions with us. We request that you please sign, fill in and return the EMIR-Appendix appended together with your Account Opening Documents. 1. EMIR counterparty classification Please classify yourself according to EMIR as one of the following counterparties: - Financial Counterparty (FC) - Non-Financial Counterparty (NFC) - Non-Financial Counterparty (NFC) over the clearing threshold (NFC+) Reliance on representations Varengold will rely on any representation we receive from You as being accurate in relation to current and future (OTC-) derivatives (as defined in EMIR) we enter into with you and will continue to do so unless and until you notify us in writing to the contrary. However, without prejudice to any other rights, powers, remedies and privileges provided by law, for the purposes of any underlying agreement between Varengold and You governing (OTC-) derivatives (as defined in EMIR), we would not treat any incorrect representation of You in connection with Your EMIR-Clearing-Status and/or EMIRcounterparty-classification and/or LEI as constituting an event of default or similar that would permit You or Varengold to terminate any (OTC-) derivatives in accordance with such agreements. Varengold Bank AG Grosse Elbstrasse Hamburg T F info@varengold.de Bankverbindung: Varengold Bank AG, SWIFT: VGAGDEHHXXX, IBAN: DE USt-IdNr. DE Registergericht Hamburg: HRB Vorstand: Yasin Sebastian Qureshi (Vorsitz) Steffen Fix Hans Dastmaltchi Bernhard Fuhrmann Frank Otten Aufsichtsrat: RA Hans J. M. Manteuffel (Vorsitz) Willi Müller Prof. Peter Andree

2 2. Portfolio reconciliation and dispute resolution procedures Certain Procedures and Provisions for portfolio reconciliation and dispute resolution have to be agreed according to EMIR. 3. Your EMIR-Clearingstatus According to EMIR and Commission Delegated Regulation (EU) No 149/2013 your Clearing- Status has to be determined. 4. Derivative transaction (e. g. in FOREX and CFD) data reporting disclosures In many countries and jurisdictions including the EU and US, Varengold is required to report derivative transactions with counterparties to appropriate regulators. In support of regulatory reporting initiatives these jurisdictions have been implemented as part of G20 transparency commitments for derivatives regulation. In order for Varengold to be compliant with the necessary reporting requirements, Varengold will report derivative transactions (e.g. in FOREX, in CFDs) and other derivative transaction data (e.g swap data) on an unmasked basis and disclose to swap data/trade repositories and/or appropriate regulators counterparty identification details. In addition, the swap data/trade repositories and the appropriate regulators have a duty to comply with applicable legal and/or contractual confidentiality obligations with respect to such information. Accordingly, your entry into any derivative transaction (e.g. in FOREX, in CFD) or other derivative transaction, or any material amendments you make to existent positions, with Varengold shall be deemed to constitute your acceptance of your agreement that Varengold may report the required swap transaction and other derivative transaction data to swap data/trade repositories and/or the appropriate regulators (of Varengold). Please be aware that you have to fulfill all your own reporting obligations according to EMIR. V1.0, January 2014, Page of

3 5. Your Legal Entity Identifier (LEI) Important: We need your Legal Entity Identifier (LEI), if you are located in one of the countries of the European Union (EU). Please insert your LEI in the EMIR-Appendix or send it by to Thank you very much and with kind regards, Varengold Bank V1.0, January 2014, Page of

4 EMIR (European Market Infrastructure Regulation)-Appendix to the Agreement (1) Application This Appendix shall apply in addition to the Agreement between Varengold Bank AG (called also "Varengold" and "Bank") and You. (2) Reconciliation of Portfolio Data You and Varengold agree to reconcile portfolios as required by the Portfolio Reconciliation Risk Mitigation Techniques. In particular: (a) on each Data Delivery Date, Varengold will provide Portfolio Data to You. Any provisons in the Agreement between Varengold and you (e.g. provisons regarding the Reversal of Mistrades and Reverse entries and correction entries made by the bank) remain unaffected.; (b) You will perform a Data Reconciliation without delay after receiving the Portfolio Data from Varengold ; (c) if You identify one or more discrepancies which You determine, acting reasonably and in good faith, are material to the rights and obligations of You and/or Varengold in respect of one or more Relevant Transaction(s) between You and Varengold, You will notify Varengold in writing as soon as reasonably practicable and You and Varengold will consult with each other in an attempt to resolve such discrepancies in a timely fashion for so long as such discrepancies remain outstanding, using, without limitation, any applicable updated reconciliation data produced during the period in which such discrepancy remains outstanding; and (d) if You do not notify Varengold that the Portfolio Data provided to You by Varengold contains discrepancies by 4 p.m. local time in Hamburg, on the fifth Business Day following the date on which Varengold provided such Portfolio Data to You, You will be deemed to have affirmed such Portfolio Data. For the purposes of Subparagraph (a) above all Portfolio Data shall be sent by Varengold to Your last known address. V1.0, January 2014, Page of

5 (3) Reconciliation Frequency The EMIR required portfolio reconciliation frequency as between Financial Counterparties (FCs) / Non-Financial Counterparties (NFCs) / Non-Financial Counterparties over the clearing threshold (NFCs+) and their counterparties: Type of counterparty FC/NFC above the clearing threshold ("NFC+") FC/NFC+ FC/NFC+ NFC below the clearing threshold ("NFC-") Number of OTC derivative contracts outstanding with a counterparty Equal/more at any time during the week Equal/smaller than 50 at any time during the quarter More than 100 at any time during the quarter Minimum frequency of reconciliation Each business day Once per week Once per quarter Once per quarter NFC- Equal/smaller than 100 Once per year Data Delivery Date: 1) If daily reconciliation is applicable, Varengold will submit the first portfolio until 12 p.m. (local time in Hamburg) of the following business day. 2) If weekly reconciliation is applicable, Varengold will submit the first portfolio data until the end of the second business day after each week. 3) If quarterly reconciliation is applicable, Varengold will submit the portfolio data until the end of the second business day after each calendar quarter. 4) If annual reconciliation is applicable, Varengold will submit the portfolio data until the end of the second business day after each calendar year. Initially Varengold currently intends to include the following "key terms" within the portfolio data: Mark-to-market valuation, Effective date, Scheduled maturity date, Notional value of trade, Currency of trade, Underlying instrument V1.0, January 2014, Page of

6 (4) Dispute Identification and Resolution Procedure You and Varengold agree that, as between You and Varengold, the following procedures to identify and resolve Disputes will be used: (a) either You or Varengold may identify a Dispute by sending a written Dispute Notice to the other party; (b) on or following the Dispute Date, You and Varengold will consult in good faith in an attempt to resolve the Dispute in a timely manner, including, without limitation, by exchanging any relevant information and by identifying and using any Agreed Process which can be applied to the subject of the Dispute or, where no such Agreed Process exists or You and Varengold agree that such Agreed Process would be unsuitable, determining and applying a resolution method for the Dispute; and (c) with respect to any Dispute that is not resolved within five Business Days of the Dispute Date, refer issues internally to appropriately senior members of staff of such party or of its Affiliate, adviser or agent in addition to actions under (b) immediately above (including actions under any Agreed Process identified and used under (b) immediately above) and to the extent such referral has not occurred as a result of action under (b) immediately above (including any Agreed Process). (d) Contact details at Varengold for (valuation) discrepancies and disputes: Type of Name Contact- emir@varengold.de Portfolio Primary Reconciliation Escalation Portfolio Reconciliation emir@varengold.de (5) Internal processes for recording and monitoring Disputes You and Varengold agree that, to the extent the Dispute Resolution Risk Mitigation Techniques apply to You and/or it, You and/or Varengold (as applicable) will have internal procedures and processes in place to record and monitor any Dispute for as long as the Dispute remains outstanding. V1.0, January 2014, Page of

7 (6) Relationship to other portfolio reconciliation and dispute resolution processes These Procedures and any action or inaction of either You or Varengold in respect of them are without prejudice to any rights or obligations those parties may possess in respect of each other under any Agreed Process or other contractual agreement, by operation of law or otherwise. Action or inaction by either You or Varengold in respect of these Procedures will not be presumed to operate as an exercise or waiver, in whole or part, of any right, power or privilege such party may possess in respect of the other under any Agreed Process or other contractual agreement, by operation of law or otherwise. In particular, but without limitation, (a) any valuation in respect of one or more Relevant Transactions for the purposes of these Procedures will be without prejudice to any other valuation with respect to such Relevant Transaction(s) made for collateral, close out, dispute or other purpose; (b) You and Varengold may seek to identify and resolve issues and discrepancies between themselves before delivering a Dispute Notice; and (c) nothing in these Procedures obliges You or Varengold to deliver a Dispute Notice following the identification of any such issue or discrepancy (notwithstanding that such issue or discrepancy may remain unresolved) or limits the rights of You or Varengold to serve a Dispute Notice, to commence or continue an Agreed Process (whether or not any action under Paragraph (4) has occurred) or otherwise to pursue any dispute resolution process in respect of any such issue or discrepancy (whether or not any action under Paragraph (4) has occurred). (7) Confidentiality Waiver / Reporting Obligations according to EMIR You and Varengold are both subject to the reporting obligations in accordance with EMIR, in particular with Article 9 of EMIR. (a) You assure that you fulfill all your reporting obligations according to EMIR by yourself and that you take all measures that Varengold can fulfill its own reporting obligations according to EMIR. (b) Varengold is entitled to use/commission third parties to fulfill its reporting obligations (e.g. to transfer trade information into a TR and/or to governmental regulators) according to EMIR, in particular with Article 9 of EMIR. V1.0, January 2014, Page of

8 (c) Notwithstanding anything to the contrary in these Procedures or in any nondisclosure, confidentiality or other agreement between You and Varengold, You hereby consent to the disclosure by Varengold of information: (i) to the extent required or permitted under, or made in accordance with, the provisions of EMIR and any applicable supporting law, rule or regulation ("EMIR and Supporting Regulation") which mandate reporting and/or retention of transaction and similar information or to the extent required or permitted under, or made in accordance with, any order or directive in relation to (and including) EMIR and Supporting Regulation regarding reporting and/or retention of transaction and similar information issued by any authority or body or agency in accordance with which Varengold is required or accustomed to act ("Reporting Requirements ) or (ii) to and between Varengold and any persons or entities who provide services to Varengold, in each case, in connection with such Reporting Requirements. (d) You acknowledge that pursuant to EMIR and Supporting Regulation, regulators require reporting of trade data to increase market transparency and enable regulators (e.g. the Bundesanstalt für Finanzdienstleistungsaufsicht (BaFin) ) to monitor systemic risk to ensure safeguards are implemented globally. (e) You further acknowledges that disclosures made pursuant hereto may include, without limitation, the disclosure of trade information including e.g. a party's identity (by name, address, corporate affiliation, identifier (e. g. LEI) or otherwise), any Portfolio data, any derivative transaction data and any collateral posted for a Transaction to any trade repository registered in accordance with Article 55 of EMIR or recognised in accordance with Article 77 of EMIR or one or more systems or services operated by any such trade repository ("TR") and any relevant regulators (including without limitation, the European Securities and Markets Authority and national regulators (e.g. the Bundesanstalt für Finanzdienstleistungsaufsicht BaFin) in the European Union) under EMIR and Supporting Regulation and that such disclosures could result in transaction and pricing data becoming available to the public. You further acknowledge that Varengold may use a third party service provider to transfer trade information into a TR and that a TR may engage the services of a global trade repository regulated by one or more governmental regulators. You also acknowledge that disclosures made pursuant hereto may be made to recipients in a jurisdiction other than that of Varengold or a jurisdiction that may not necessarily provide an equivalent or adequate level of protection for personal data as Your home jurisdiction. For the avoidance of doubt, (i) to the extent that V1.0, January 2014, Page of

9 applicable non-disclosure, confidentiality, bank secrecy, data privacy or other law imposes non-disclosure requirements on transaction and similar information required or permitted to be disclosed as contemplated herein but permits a party to waive such requirements by consent, the consent and acknowledgements provided herein shall be a consent by You for purposes of such law; (ii) any agreement between You and Varengold to maintain confidentiality of information contained in these Procedures or in any non-disclosure, confidentiality or other agreement shall continue to apply to the extent that such agreement is not inconsistent with the disclosure of information in connection with the Reporting Requirements as set out herein; and (iii) nothing herein is intended to limit the scope of any other consent to disclosure separately given by You to Varengold. (f) You represent and warrant that any third party to whom You owe a duty of confidence in respect of the information disclosed has consented to the disclosure of that information. (8) Amendment You and Varengold agree that Varengold may amend or modify these Procedures and Provisions at any time by providing You with written notice setting out the amended or modified procedures that will apply as between You and Varengold and the date from which they will apply (which shall be no earlier than the date of the notice). (9) Continuing Application You and Varengold agree that You and Varengold shall continue to apply these Procedures and Provisions unless and until You are notified in writing to the contrary by Varengold or You and Varengold otherwise agree in writing. (10) Remedies Without prejudice to the rights, powers and privileges provided by law, for the purposes of any underlying agreements between You and Varengold governing Relevant Transactions, failure by You or Varengold to take any actions required by or to otherwise comply with these Procedures will not constitute an event of default or other similar event that would permit You or Varengold to terminate any Relevant Transaction in accordance with such agreements. If Varengold uses/commissions a third party service provider to fulfill its reporting obligations according to EMIR (e.g. to transfer trade information into a TR and/or to governmental V1.0, January 2014, Page of

10 regulators), Varengold shall only be liable for failure to exercise due care in the selection of such third party. (11) Definitions For the purposes of these Procedures: "Agreed Process" means, as between You and Varengold, any process agreed between You and Varengold in respect of a Dispute other than the Dispute Resolution Procedure. "Data Delivery Date" means, as between You and Varengold, each date according to Paragraph 3 of this Appendix. "Data Reconciliation" means, in respect of a party receiving Portfolio Data, a comparison of the Portfolio Data provided by the other party against such party's own books and records of all outstanding Relevant Transactions between the parties in order to identify promptly any misunderstandings of Key Terms. "Dispute" means, as between You and Varengold, any dispute between You and Varengold (a) which, in the sole opinion of the party delivering the relevant Dispute Notice, is required to be subject to the Dispute Resolution Procedure (or other Agreed Process) pursuant to the Dispute Resolution Risk Mitigation Techniques; and (b) in respect of which a Dispute Notice has been effectively delivered. "Dispute Date" means, with respect to a Dispute, the date on which a Dispute Notice is effectively delivered by You or Varengold to the other save that if, with respect to a Dispute, both You and Varengold deliver a Dispute Notice, the date on which the first in time of such notices is effectively delivered will be the Dispute Date. Each Dispute Notice will be effectively delivered if delivered in the manner agreed between You and the Varengold for the giving of notices in respect of these Procedures. "Dispute Notice" means a notice in writing which states that it is a dispute notice for the purposes of Paragraph 4 and which sets out in reasonable detail the issue in dispute (including, without limitation, the Relevant Transaction(s) to which the issue relates). "Dispute Resolution Procedure" means the identification and resolution procedure set out in Paragraph 4. "Dispute Resolution Risk Mitigation Techniques" means the dispute resolution risk mitigation techniques for OTC derivative transactions set out in Article 11(1)(b) of EMIR as V1.0, January 2014, Page of

11 supplemented by Article 15 of Chapter Vlll of the Commission Delegated Regulation (EU) No 149/2013 of 19 December 2012 and published on 23 February 2013 in the Official Journal of the European Union. "EMIR" means Regulation (EU) No 648/2012 of the European Parliament and of the Council on OTC derivatives, central counterparties and trade repositories dated 4 July "Business Day" means any day (excluding Saturday and Sunday, German public holidays and the 24 th and 31th of December) on which bank generally are open in Germany for the transactions of normal banking business. "Key Terms" means, with respect to a Relevant Transaction and a party to that Relevant Transaction, the valuation of such Relevant Transaction and such other details the relevant party deems relevant from time to time which may include the reference number, the scheduled maturity date, any payment or settlement dates, the notional value of the contract and currency of the Relevant Transaction, the underlying instrument, the business day convention and any relevant fixed or floating rates of the Relevant Transaction. For the avoidance of doubt, "Key Terms" does not include details of the calculations or methodologies underlying any term. LEI means Legal Entity Identifier. The LEI is a necesseary part of the Portfolio Data and every party has to request its LEI by itself. "Portfolio Data" means, in respect of a party providing or required to provide such data, the Key Terms in relation to all outstanding Relevant Transactions between the parties in a form and standard that is capable of being reconciled. The information comprising the Portfolio Data to be provided by a party on a Data Delivery Date will be prepared as at the close of business on the immediately preceding Business Day of, and as specified in writing by, the party providing the Portfolio Data. Any provisons in the Agreement between Varengold and You (e.g. provisons regarding the Reversal of Mistrades and Reverse entries and correction entries made by the bank) remain unaffected. "Portfolio Reconciliation Requirements" means the requirements You and/or Varengold are subject to in accordance with the Portfolio Reconciliation Risk Mitigation Techniques. "Portfolio Reconciliation Risk Mitigation Techniques" means the portfolio reconciliation risk mitigation techniques for OTC derivative transactions set out in Article 11 (1)(b) of EMIR as supplemented by Article 13 of Chapter Vlll of the Commission Delegated Regulation (EU) No V1.0, January 2014, Page of

12 149/2013 of 19 December 2012 and published on 23 February 2013 in the Official Journal of the European Union. "Relevant Transaction" means any (OTC-) derivative (as defined in EMIR) which is subject to the Portfolio Reconciliation Risk Mitigation Techniques and/or the Dispute Resolution Risk Mitigation Techniques. (12) Your EMIR-Clearing-Status According to EMIR and Commission Delegated Regulation (EU) No 149/2013 your Clearing- Status has to be determinded. a) You assure that you are (please tick): a) subject to the clearing obligation b) not subject to the clearing obligation b) You are obliged to inform Varengold without delay about any changes in your EMIR-Clearing-Status by sending an to (13) Your contact details for (valuation) discrepancies and disputes Please supply your contact details for discrepancies and disputes: Type of Name Contact Primary Portfolio Reconciliation Escalation Portfolio Reconciliation V1.0, January 2014, Page of

13 (14) Your EMIR-counterparty-classification According to EMIR and Commission Delegated Regulation (EU) No 149/2013 your Status as Counterparty has to be determinded. a) You assure that you are a (please tick): a) Financial Counterparty (FC) b) Non-Financial Counterparty (NFC) c) Non-Financial Counterparty (NFC) over the clearing threshold (NFC+) b) You are obliged to inform Varengold without delay about any changes in Your EMIRcounterparty-classification by sending an to emir@varengold.de. (15) Reliance on representations Varengold will rely on any representation we receive from you as being accurate in relation to current and future (OTC-) derivatives (as defined in EMIR) Varengold enter into with you and will continue to do so unless and until you notify Varengold in writing to the contrary. However, without prejudice to any other rights, powers, remedies and privileges provided by law, for the purposes of any underlying agreement between Varengold and You governing (OTC-) derivatives (as defined in EMIR), Varengold would not treat any incorrect representation in connection with Your EMIR-Clearing-Status and/or EMIR-counterpartyclassification and/or LEI as constituting an event of default or similar that would permit You or Varengold to terminate any (OTC-) derivatives in accordance with such agreements. V1.0, January 2014, Page of

14 (16) Your Legal Entity Identifier (LEI) In the case You are located in one of the countries of the European Union (EU), please insert your LEI in the box. You assure that Your LEI is the following: LEI (17) General a) This Appendix and any dispute or claim in connection with it or its subject matter shall be governed by and construed in accordance with the laws of the Federal Republic of Germany. b) The parties irrevocably agree, for the sole benefit of Varengold Bank AG that, subject as provided below, the Courts of Hamburg, Germany shall have exclusive jurisdiction over any dispute arising out of or in connection with this Appendix (including a dispute regarding its existence, validity or termination) (a Appendix-Dispute ). The parties agree that the Courts of Hamburg, Germany are the most appropriate and convenient courts to settle Appendix- Disputes and accordingly no party will argue to the contrary. Nothing in this clause shall prevent Varengold Bank AG from taking proceedings relating to an Appendix-Dispute in any other court of competent jurisdiction. To the extent provided by law, Varengold Bank AG may take concurrent proceedings in any number of jurisdictions. c) Oral agreements do not exist. If any of the provisions of this Appendix shall become or held invalid or unenforceable, all other provisions hereof shall remain in full force and effect. The invalid provision or unenforceable provision shall be deemed to be automatically amended and replaced by a valid or enforceable provision which economically accomplishes as far as possible the purpose and the intent of the invalid or unenforceable provision. The same shall apply to gaps (if any). Signed: On behalf of: Title: Date: V1.0, January 2014, Page of