Securities Financing Transactions Regulation (SFTR)—essentials


Published by a ÀÏ˾»úÎçÒ¹¸£Àû Financial Services expert
Practice notes

Securities Financing Transactions Regulation (SFTR)—essentials


Published by a ÀÏ˾»úÎçÒ¹¸£Àû Financial Services expert

Practice notes
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What is the EU SFTR?

The EU Regulation on reporting and transparency of securities financing transactions (Regulation (EU) 2015/2365) (EU SFTR) is intended to improve transparency of securities financing transactions (SFTs). It imposes obligations on counterparties to these transactions and requires SFTs to be reported to trade repositories, places additional reporting requirements on investment managers and introduces the need for prior risk disclosures and written consent before assets are reused. This Practice Note explores the key elements of the EU SFTR and the UK SFTR and acts as a general introduction to their requirements. For background, see below at Securities Financing Background—Why was the EU SFTR introduced?

What is the UK SFTR?

The EU SFTR was retained (onshored) in the UK after the end of the Brexit transition period at 11pm on 31 December 2020 (IP completion day).

A key item of UK/EU divergence is that the reporting obligation for non-financial counterparties, which became applicable on 11 January 2021 (ie after the IP completion day) as set out in Article 4 of Regulation (EU) 2015/2365, does

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United Kingdom
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Key definition:
Securities definition
What does Securities mean?

This is one of the groups of regulated investments defined in the regulated activities order (the other groups being identified as contractually based investments and others).

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