EMIR Refit Gotcha: Use MIC Codes for Third-Country Venues (Not XOFF)
Key Takeaways
- Venue-Field Distinction: Under EMIR Refit, equivalent third-country venues still require MIC codes even though the transaction is otherwise treated as OTC.
- Field Interaction Risk: Misclassifying the venue as XOFF can corrupt other reporting fields, including clearing-obligation and intragroup indicators, even when OTC treatment is correct.
- Regime Crossover Trap: The article shows that familiarity with multiple reporting regimes can create mistakes when firms assume superficially similar fields behave identically.
- Validation Exposure: Incorrect venue completion is presented as a common cause of trade-repository rejects and avoidable bilateral counterparty reconciliation breaks.
- Implementation Insight: Firms need regime-specific field logic that separates venue coding from broader OTC versus ETD treatment to avoid systematic errors.
Under EMIR Refit, MIC codes should still be used for third country venues deemed equivalent to regulated markets. However, the transaction should be treated as OTC for other reporting fields (for example Clearing Obligation and Intragroup).
As preparation has started for EMIR Refit, many regulatory reporting teams are cross-functional and may be involved in implementation of various regimes including MiFIR and EMIR. Whilst familiarity of multiple reporting regimes may be of benefit in aiding understanding of the requirements, there are some distinct differences between seemingly similar fields and the expectations of the required data. Therefore, it is important to be aware of the differences when navigating the details.
Using MIC Codes for Third Country Venues Instead of XOFF
MIC Codes continue to be used to identify regulated markets, or third country venues considered as equivalent to a regulated market. However, it is important to be mindful that transactions executed on third-country equivalent venues should be considered OTC as opposed to ETD. This is important distinction as it affects the completion of other fields, such as Intragroup and Clearing Obligation.
Some market participants fall into the trap of identifying the transaction as OTC and placing XOFF into the Venue field to denote the OTC status. However, this is incorrect as the MIC Code continues to be included in the Venue field even though the rest of the fields are completed as though the transaction was conducted OTC.
Incorrect venue completion commonly triggers TR validation rejects and can lead to reconciliation breaks with counterparties.
How Qomply can help
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Frequently asked questions
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The gotcha is that firms should use the MIC code, not XOFF, for third-country venues deemed equivalent to regulated markets. The article says the trade is still treated as OTC for other reporting fields such as Clearing Obligation and Intragroup.
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It says firms do this because they correctly recognise the trade as OTC but then carry that OTC logic into the venue field. The article makes clear that this is the wrong conclusion for third-country equivalent venues.
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They should be reported with the MIC code in the venue field while being treated as OTC for other field populations. The article says that mixed treatment is the key distinction firms need to remember.
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It says the error commonly triggers trade repository validation rejects and reconciliation breaks with counterparties. The article presents this as a practical reporting-control issue, not just a theoretical rule point.
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They should make sure they do not carry MiFIR field logic into EMIR Refit without checking the regime-specific requirement. The article says teams working across both regimes must stay alert to subtle but important field differences.