Version date: 5 August 2013 - onwards
OTC Question 15: Dispute Resolution [last update 5 August 2013]
Article 15 of the RTS on OTC derivatives
Dispute Resolution - Article 15 of the RTS on OTC Derivatives
(a) Should counterparties identify and record each disputes relating to the recognition or valuation of the contract and to the exchange of collateral, even the minor one?
(b) Does dispute resolution include the disputes related to cashflows settlement?
(c) When reporting outstanding disputes in accordance with Article 15(2) of Regulation 149/2013 should the amount or value of outstanding disputes be calculated and reported on a trade by trade or portfolio basis?
(d) How frequently are financial counterparties required to notify their relevant national authority of outstanding disputes in accordance with article 15(2) of Regulation 149/2013?
(e) What is the 'valuation’ referred to in Article 15 of the RTS on OTC derivatives?
OTC Answer 15
(a) Counterparties may agree upfront that discrepancies that amount to a value below a pre-defined threshold do not count as disputes. If that is the case, these minor discrepancies would not count as disputes. All the other discrepancies would give rise to disputes and be treated according to Article 15 of the RTS on OTC derivatives.
(b) Yes. A dispute may be caused by cashflows settlement breaks.