Circular to licensed corporations – Margin requirements
for non-centrally cleared OTC derivative transactions
The SFC published a circular informing licensed corporations
(LCs) that the SFC will defer the introduction of initial margin
(IM) requirements for non-centrally cleared over-the-counter (OTC)
derivative transactions by one year to provide operational relief
in light of the COVID-19 outbreak. The IM requirements for LCs
which are contracting parties to non-centrally cleared OTC
derivative transactions entered into with a covered entity were
originally to be phased in starting from 1 September 2020.
In light of the Basel Committee on Banking Supervision and the
International Organization of Securities Commissions
announcement of the one-year extension of the deadlines for