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🇪🇺 ESMA Consultation medium

August 3rd 2026

EBA, EIOPA and ESMA propose amendments to bilateral margin requirements

EBA, EIOPA and ESMA propose amendments to bilateral margin requirements 03 August 2026 Joint Committee Trading The European Supervisory Authorities (EBA, EIOPA and ESMA – the ESAs) today published a final report on draft Regulatory Technical Standards (RTS), proposing to simplify the bilateral margin requirements of the European Commission’s Delegated Regulation (EU) 2016/2251. The proposed amendments aim to simplify the bilateral margin framework for counterparties that are subject to initia...

AI Analysis

The ESAs have issued a Final Report and draft RTS proposing targeted amendments to Delegated Regulation (EU) 2016/2251 so that counterparties below the EUR 8 billion initial margin threshold under EMIR are fully exempt from exchanging initial margin, both on new and existing uncleared OTC derivatives. This materially simplifies bilateral margining for smaller in-scope counterparties, reduces operational and custodial burdens, and aligns the EU regime with similar reforms already implemented in other jurisdictions (e.g. UK EMIR). Compliance teams must prepare now for the transition from a “legacy-only” margining obligation to a complete exemption once the EUR 8 billion AANA threshold is no longer met.

What Changed

- Counterparties whose average aggregate notional amount (AANA) of non-centrally cleared OTC derivatives falls below the EUR 8 billion threshold will no longer be required to exchange initial margin...
The current framework, under which below-threshold counterparties are exempt from initial margin for new trades but must continue to exchange initial margin for pre-existing “legacy” contracts, will...
Article 28(1) of Delegated Regulation (EU) 2016/2251 will be amended to explicitly extend the exemption from initial margin requirements to outstanding contracts where one of the two counterparties...
The RTS introduce a clearer operational framework for entry into and exit from the initial margin regime based on the annual AANA calculation for March–May, including scenarios where one or both...
Once a counterparty falls below the EUR 8 billion threshold under the revised rules, firms will be permitted to terminate related initial margin processes, including ceasing ongoing calculation,...

Suggested Considerations

Map all EMIR in-scope entities within the group and identify those whose AANA of non-centrally cleared OTC derivatives is close to or below the EUR 8 billion threshold, to assess which relationships may benefit from the expanded exemption.
Review current collateral and margin frameworks to identify legacy contracts where initial margin is still being exchanged solely because the regime requires continuation despite the counterparty having fallen below the EUR 8 billion threshold.
Prepare an internal policy update so that, once the RTS enter into force, initial margin requirements are switched off for counterparties below the EUR 8 billion threshold on both new and existing uncleared OTC derivatives, subject to group risk appetite.
Update EMIR margin procedures and AANA calculation processes to ensure accurate annual determination of whether each counterparty is above or below the EUR 8 billion threshold, including documentation of the March–May calculation methodology.
Review and amend collateral agreements, credit support annexes (CSAs) and associated legal documentation to incorporate the revised treatment for below-threshold counterparties, including terms for stopping margin exchange and potentially releasing segregated collateral.

Key Dates

03 August 2026

- ESAs publish the Final Report and draft RTS proposing amendments to Delegated Regulation (EU) 2016/2251 to simplify bilateral margin requirements for counterparties below the EUR 8 billion initial margin threshold

TBD (European Commission adoption)

- The European Commission reviews and, if satisfied, endorses the draft RTS amending the EMIR bilateral margin Delegated Regulation; exact date to be set by the Commission’s internal process

TBD (European Parliament and Council scrutiny)

- Following Commission endorsement, the RTS are subject to scrutiny by the European Parliament and the Council under the standard RTS procedure before publication in the Official Journal

TBD (Entry into force – OJ publication + 20 days)

- The amended RTS enter into force on the date specified in the Official Journal (typically 20 days after publication), from which firms can legally apply the new exemption regime

TBD (Three years after entry into force) DEADLINE

- By the date three years after entry into force, the ESAs must complete a review of the application and impact of the exemption from initial margin requirements in Article 28(1), potentially informing further changes

Compliance Impact

The amendments reduce the risk of technical non-compliance for below-threshold counterparties by simplifying obligations, but firms that fail to correctly apply the new threshold-based exemption (e.g. continuing or ceasing margin exchanges incorrectly) may face supervisory findings, remediation demands and potential sanctions under EMIR. Non-compliance could also create contractual disputes and counterparty risk misalignment if margin treatment is inconsistent across jurisdictions or relationships.

References

AI-generated analysis. May contain errors or omissions — verify with the original ESMA source before acting. Full disclaimer.

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Banking & Credit Capital Markets & Trading Insurance & Pensions

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