1. Without prejudice to risk-mitigation techniques under Article 11, the clearing obligation referred to in Article 4(1) shall not apply to an OTC derivative contract that is initiated and concluded as the result of an eligible post-trade risk reduction ("PTRR") exercise ("PTRR transaction") carried out pursuant to paragraphs 2 to 4 of this Article.

2. A PTRR transaction shall only be exempted from the clearing obligation referred to in Article 4(1) where:

(a) the entity performing the PTRR exercise ("PTRR service provider") complies with the requirements set out under paragraphs 3 and 4 of this Article; and

(b) each participant in the PTRR exercise complies with the requirements under paragraph 3 of this Article.

3. An eligible PTRR exercise shall:

(a) be performed by an entity authorised in accordance with Article 7 of the Directive 2014/65/EU that is independent of the counterparties to the OTC derivative contracts included in the PTRR exercise;

(b) achieve a reduction in risk in each of the portfolios submitted to the PTRR exercise;

(c) be accepted in full and, as a result, the participants in the PTRR exercise shall not be able to choose which trades to execute under the PTRR exercise;