Which European or UK rules apply comes up in work such as clearing derivatives, reporting them, trading them on trading venues, preparing and providing a KID, or administering benchmarks.

Types of EU legislation and the bodies that write the detail

An EU regulation is legally binding and applies directly across the EU. A directive sets a goal that member states must achieve, and each member state decides which national law achieves it1. The derivatives rules rest on the regulations and directives listed in the next section.

The European Commission proposes legislation2. For the clearing part of the EMIR amendments, a political agreement between the European Parliament and the Council of the EU came on February 7, 20243.

Technical standards set out the detail of the articles. Under European Market Infrastructure Regulation (EMIR), for example, the European Securities and Markets Authority (ESMA) drafts regulatory technical standards (RTS) and implementing technical standards (ITS)4. Of these, the European Commission adopts the RTS as delegated regulations, based on ESMA's drafts35. ESMA, which drafts, and the Commission, which adopts, are separate bodies.

European CommissionParliament & CouncilESMAProposes the lawAdopts the lawDraftsthe RTSAdopts thedelegatedregulation
Figure 1How an EU law and its technical standards are made
Figure description

The figure shows that the body that drafts and the body that adopts are different. The adoption of implementing technical standards (ITS) is not shown in the figure. Not every law follows this order2345.

The main rules and what each one sets

The main rules for derivatives fall into five groups.

Rule Legal basis What it sets
European Market Infrastructure Regulation (EMIR) Regulation (EU) No 648/20126 Clearing obligation (OTC derivatives that meet the conditions), risk mitigation (uncleared trades), and reporting to trade repositories (all derivatives transactions)4
Markets in Financial Instruments Directive II (MiFID II) and Markets in Financial Instruments Regulation (MiFIR) MiFID II is Directive 2014/65/EU and MiFIR is Regulation (EU) No 600/201478 Trading venue requirements (MiFID II); transparency, reporting, and the trading obligation (MiFIR)98
Capital rules (CRR and CRD) Regulation (EU) No 575/2013 and Directive 2013/36/EU1011 Prudential requirements for banks and investment firms
Benchmarks Regulation (BMR) Regulation (EU) 2016/101112 Covers indices used in financial instruments, financial contracts, and more12
PRIIPs Regulation Regulation (EU) No 1286/201413 Requires manufacturers and sellers to provide a key information document (KID)14

The titles on legislation.gov.uk give these dates: EMIR, July 4, 2012; MiFID II and MiFIR, May 15, 2014; the CRR and CRD, June 26, 2013; the BMR, June 8, 2016; and the PRIIPs Regulation, November 26, 2014.

EMIR also sets standards for central counterparties and trade repositories4. It came into force on August 16, 20124 and was amended in 2019 (Refit) and 2024 (EMIR 3)3. The details are covered in EMIR.

MiFID II sets organizational requirements for trading venues and more, and it also sets position limits for commodity derivatives9. MiFIR sets trade transparency, transaction reporting, and the obligation to trade some derivatives on regulated trading venues98. The details are covered in MiFID II and MiFIR.

Examples of the parts of the capital rules that concern derivatives include own funds requirements for counterparty credit risk and CVA risk, exposures to central counterparties, and the calculation of the exposure value of derivatives. These are examples, not a complete list10.

The European Commission describes the capital rules (CRR and CRD) as a whole as bringing the Basel III international standards into EU law. CRD VI and CRR III entered into force on July 9, 202415.

The Benchmarks Regulation also covers indices used to measure the performance of investment funds12. The European Commission explains that the LIBOR problems raised concerns about the absence of rules governing benchmarks16.

The PRIIPs Regulation applies to packaged retail investment products and insurance-based investment products14.

EU and UK authorities

In the EU, the European Commission, ESMA, the European Banking Authority (EBA), the European Central Bank (ECB), and national authorities share the roles.

Body Role
European Commission Proposes legislation, adopts delegated regulations, and decides that a third country's framework is equivalent to the EU's3
ESMA An independent authority that regulates and supervises EU financial markets. Its mission is investor protection, orderly markets, and financial stability17
EBA An independent EU authority that safeguards the soundness of the banking sector and writes harmonized rules for financial institutions18
ECB The central body that supervises the soundness of financial institutions in the euro area under the Single Supervisory Mechanism (SSM)19
National authorities Supervise their national securities and capital markets17

The ECB directly supervises the largest banks, and national authorities oversee the rest19. National authorities set position limits for commodity derivatives9.

Under EMIR, equivalence decisions allow the use of central counterparties and trade repositories outside the EU3. ESMA supervises trade repositories and grants or withdraws their registration3. It also works to converge the supervision of national authorities17.

In the UK, the Financial Conduct Authority (FCA), the Prudential Regulation Authority (PRA), and the Bank of England share the roles.

Body Role
Financial Conduct Authority (FCA) Regulates the conduct of UK financial services firms and enforces the standards it sets20
Prudential Regulation Authority (PRA) Part of the Bank of England. It regulates and supervises the soundness of financial institutions21
Bank of England The UK's central bank. It regulates major banks and other firms through the PRA, and also supervises financial market infrastructure22

The PRA regulates and supervises banks, building societies, credit unions, insurers, and major investment firms. It sets its policy in the PRA Rulebook21. The financial market infrastructure the Bank of England supervises includes payment systems and central counterparties22.

On April 1, 2013, the FCA took over conduct regulation and some prudential regulation from the Financial Services Authority (FSA)20.

The UK framework after leaving the EU

Many EU regulations remained in force as UK law after the UK left the EU. The European Union (Withdrawal) Act 2018 provides that certain EU legislation became part of domestic law. This covers the EU regulations and other direct EU legislation that were operative immediately before the end of the withdrawal transition period2324.

From January 1, 2024, the UK calls the EU regulations that became part of its domestic law after withdrawal "assimilated law". Before that, they were called retained EU law2526.

The UK amends the EU regulations that remained in its law on its own, separately from the EU. legislation.gov.uk states that the UK version is published by the UK National Archives and the EU version by EUR-Lex27. The UK version and the EU version therefore do not necessarily have the same text.

The Financial Services and Markets Act 2023 (FSMA 2023) provides for the revocation of assimilated law relating to financial services and markets. The list includes EMIR, the CRR, MiFIR, the PRIIPs Regulation, and the Benchmarks Regulation28. Revocation does not necessarily mean the rules disappear28.

This revocation provision was not in force when the Act was passed, and it has been brought into force in stages for specified purposes28. Which regulation's provisions have changed, when, and how far differs from one regulation to the next29.

Where to read about each type of rule

The table below shows the main EU basis for each type of rule and the pages on this site where you can read about it.

The article numbers and headings were checked against the revised version of the UK text published on legislation.gov.uk as of October 1 to 3, 2026. The current EU text is published in the EU's legal database (EUR-Lex) and is not necessarily the same as the UK version.

Type of rule Main EU basis Page to read
Clearing EMIR Article 4 (clearing obligation), MiFIR Article 29 (clearing obligation for derivatives traded on regulated markets)308 EMIR
Reporting EMIR Article 9 (reporting obligation), MiFIR Article 26 (obligation to report transactions)308 EMIR and MiFID II and MiFIR
Trade execution MiFIR Article 28 (obligation to trade on regulated markets, MTFs, or OTFs)8 MiFID II and MiFIR
Margin EMIR Article 11 (risk mitigation for OTC derivatives not cleared by a central counterparty)30 EMIR
Investor protection MiFID II (investment services), PRIIPs Regulation (key information documents)3114 MiFID II and MiFIR
Benchmarks Benchmarks Regulation (BMR)12 What Is a Benchmark Rate? and The Transition from LIBOR
Capital CRR and CRD10 There is no EU article yet

Consider a hypothetical example in which a European financial institution enters into an OTC derivative that is not cleared by a central counterparty, and another that is.

Hypothetical trade Rows and articles that may apply Pages to open
A European financial institution enters into an OTC derivative that is not cleared by a central counterparty The "Margin" row (EMIR Article 11) and the "Reporting" row (EMIR Article 9, MiFIR Article 26)308 EMIR; MiFID II and MiFIR
A European financial institution enters into an OTC derivative that is cleared by a central counterparty The "Clearing" row (EMIR Article 4) and the "Reporting" row30 EMIR

For the uncleared trade, the "Margin" row, which covers risk mitigation for OTC derivatives not cleared by a central counterparty, may apply. In the "Reporting" row, EMIR and MiFIR set separate obligations. For the cleared trade, the heading of the article behind the "Margin" row covers only trades not cleared by a central counterparty. That row therefore does not appear to apply. The "Clearing" row and, separately, the "Reporting" row may apply30.

What this article does not cover

What applies in the UK after revocation, and whether a rule applies to an individual trade, is not covered on this page.

Notes

  1. European Union, "Types of legislation", "Regulations" and "Directives" (checked on October 3, 2026). ↩

  2. European Union, "European Commission", the opening paragraph and under the heading "Proposes new laws" (checked on October 3, 2026). ↩ ↩2

  3. European Commission, "Derivatives / EMIR" (checked on October 3, 2026), the sections "Policy making timeline", "Relevant legislation", "Objectives of EMIR", and "Equivalence decisions under EMIR". ↩ ↩2 ↩3 ↩4 ↩5 ↩6 ↩7

  4. ESMA, "Post-trading" (checked on October 3, 2026). The EMIR section and the section "ESMA measures implementing EMIR". ↩ ↩2 ↩3 ↩4 ↩5

  5. ESMA, press release on the draft regulatory technical standards for CCP colleges (dated March 30, 2020; checked on October 3, 2026), "Next steps". This is an example, the standards for CCP colleges, and not a general rule. ↩ ↩2

  6. legislation.gov.uk, the title of Regulation (EU) No 648/2012 ("of 4 July 2012"). This is the revised UK version, reflecting changes up to October 1, 2026. ↩

  7. legislation.gov.uk, the title of Directive 2014/65/EU ("of 15 May 2014"). EU directives are published for cross-referencing and do not reflect amendments made after IP completion day. ↩

  8. legislation.gov.uk, the title and table of contents of Regulation (EU) No 600/2014 ("of 15 May 2014") and, in the table of contents, Title II and Articles 26, 28, and 29. It reflects changes up to October 1, 2026. ↩ ↩2 ↩3 ↩4 ↩5 ↩6 ↩7

  9. ESMA, "Trading" (checked on October 3, 2026). The sections "Fairer, safer and more efficient markets" (trading venue requirements), "Greater transparency" (trading obligation), and "Commodity derivatives" (position limits under Article 57 of MiFID II). ↩ ↩2 ↩3 ↩4

  10. legislation.gov.uk, the title and table of contents of Regulation (EU) No 575/2013 ("of 26 June 2013") and, in the table of contents, Part Three, Title II Chapter 6, Title VI, and Article 429a. ↩ ↩2 ↩3

  11. legislation.gov.uk, the title of Directive 2013/36/EU ("of 26 June 2013"). EU directives are published for cross-referencing and do not reflect amendments made after IP completion day. ↩

  12. legislation.gov.uk, the title of Regulation (EU) 2016/1011 ("of 8 June 2016"). As of October 1, 2026, the revocation by Part 1 of Schedule 1 to the Financial Services and Markets Act 2023 is listed as a change not yet reflected in the text. ↩ ↩2 ↩3 ↩4

  13. legislation.gov.uk, the title of Regulation (EU) No 1286/2014 ("of 26 November 2014"). The title carries "(revoked)". ↩

  14. European Commission, the PRIIPs page (checked on October 3, 2026). The description of PRIIPs, and the section "Key information documents for PRIIPs", which requires manufacturers and sellers to provide the KID. ↩ ↩2 ↩3

  15. European Commission, "Prudential requirements" (checked on October 3, 2026), the sections "What the EU is doing and why" and "Policy making timeline". ↩

  16. European Commission, "Markets integrity: Benchmarks and market abuse" (checked on October 3, 2026). The section "What the EU is doing and why". ↩

  17. ESMA, "About ESMA" (checked on October 3, 2026). The mission (investor protection, orderly markets, financial stability), its status as an independent authority, and its work to converge the supervision of national competent authorities (NCAs). ↩ ↩2 ↩3

  18. European Banking Authority, "About us" (checked on October 3, 2026). The opening description and the section "Activities". ↩

  19. European Commission, "Single supervisory mechanism" (checked on October 3, 2026). The ECB is the central prudential supervisor of financial institutions in the euro area and other participating countries. It directly supervises the largest banks, and the national supervisory authorities oversee the rest. ↩ ↩2

  20. Financial Conduct Authority (FCA), "About the FCA", "Our role" (checked on October 3, 2026; the page was updated on July 9, 2026). ↩ ↩2

  21. Bank of England, "Prudential regulation" (checked on October 3, 2026). The description of the PRA and the statement that policy is set in the PRA Rulebook. ↩ ↩2

  22. Bank of England, "What does the Bank of England do?" (updated on March 12, 2026). "What we do" and "Our supervision supports critical infrastructure". ↩ ↩2

  23. European Union (Withdrawal) Act 2018, section 3(1). The revised version on legislation.gov.uk (checked on October 3, 2026). ↩

  24. European Union (Withdrawal Agreement) Act 2020, section 39, the definition of "IP completion day" (11.00 p.m. on December 31, 2020). "The end of the withdrawal transition period" in the text means this day. ↩

  25. European Union (Withdrawal) Act 2018, the heading of section 7 ("Status of assimilated law"). The note on the replacement of the term in the heading (January 1, 2024). ↩

  26. Retained EU Law (Revocation and Reform) Act 2023, the table of contents heading "Assimilation of retained EU law" and section 5 "Assimilated law". ↩

  27. legislation.gov.uk, the note on the page for Regulation (EU) No 600/2014 (the UK version is published by legislation.gov.uk and the EU version by EUR-Lex). The pages for the other regulations carry the same note. ↩ ↩2

  28. Financial Services and Markets Act 2023, section 1 and Part 1 of Schedule 1, sections 4 and 6 in the table of contents, and the commencement note to section 1. The revised version on legislation.gov.uk (checked on October 3, 2026). ↩ ↩2 ↩3

  29. legislation.gov.uk, the "Changes and effects yet to be applied" sections on the EMIR and BMR pages (as of October 1, 2026). The title of the PRIIPs Regulation and the "Status" on the MiFID II page. ↩ ↩2

  30. ESMA, Interactive Single Rulebook for EMIR (checked on October 3, 2026), the headings of Articles 4, 9, and 11. ↩ ↩2 ↩3 ↩4 ↩5 ↩6

  31. European Commission, "Investment services and regulated markets" (checked on October 3, 2026). The section "What the EU is doing and why". ↩