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The Derivatives Service Bureau (DSB) has opened a consultation on the legal terms and conditions expected to apply to users of the Unique Product Identifier (UPI) Service, due to launch next year.
The DSB’s consultation sets out the proposals for users of the UPI Service, as well as highlighting the resulting user experience for firms utilising the current over-the-counter (OTC) International Securities Identification Number (ISIN) service.
The UPI is designed to facilitate effective aggregation of OTC derivatives transaction reports on a global basis. Reporting parties will be mandated to incorporate the UPI into their workflows and submit these to trade repositories once mandates come into effect in Africa, Asia, Australia, Europe and the Americas.
The DSB UPI legal terms and conditions consultation sets out a range of proposals aimed to align with industry feedback for the DSB to support the UPI Service within the existing DSB legal framework.
Proposals include the use of a single overarching legal agreement with fee-paying users able to subscribe to OTC ISIN and UPI Services, introduction of a client onboarding and support platform, use of the legal entity identifier for user onboarding verification as well as use of pre-payment for lower value user fees.
Other suggestions include the fee model variables to be used for annual fee determination, the approach to termination, suspension and renewals, dispute resolution mechanism and the transfer of user data in the case of a contingency scenario, among others.
The DSB recommends that both current and potential users of the UPI Service review and respond to the questions set out in the consultation paper.
DSB webinars will take place on the 9 and 10 of November where an overview of the consultation will be provided. The deadline for industry feedback is 19 January 2022.
The DSB, was founded by the Association of National Numbering Agencies (ANNA) to facilitate the allocation and maintenance of ISINs for OTC derivatives, and was subsequently mandated by the Financial Stability Board as the sole UPI Service Provider to facilitate creation and distribution of UPIs globally.
Emma Kalliomaki, managing director of ANNA and the DSB, says: “The DSB is an industry led utility, producing standardised OTC data for an evolving market. Good governance principles are at the core of the UPI to ensure a better service for the market. The DSB would like to encourage all interested parties to review the proposals of the UPI legal terms and conditions consultation and provide their feedback by 19 January 2022 when the feedback window closes.”
