The International Swaps and Derivatives Association (ISDA) has launched the full open-source version of the Digital Regulatory Reporting (DRR) model.
ISDA members and non-members will have access to the DRR model to support compliance with the US Commodity Futures Trading Commission’s (CFTC) amended swap data reporting rules.
The DRR, which is free to access, provides market participants with a mutualised industry interpretation of the rules.
Firms can use the DRR model as the basis for implementation, or to check if their own interpretation of the rules is consistent with the peer-reviewed industry version.
The launch of DRR follows the implementation and testing of the initiative by BNP Paribas which used the DRR to submit data required under the revised CFTC rules to DTCC’s swap data repository testing simulator.
With the DRR now available to market participants for the CFTC rewrite, work will continue in a test environment to develop new functionality and adapt the framework for forthcoming data reporting rule changes in Europe and the APAC region, says ISDA.
ISDA estimates that approximately 70 per cent of the coded CFTC rules can be transferred directly to the DRR that is being developed for Europe, while 90 per cent of the combined coded US and European rules could be applied for rule changes in the APAC region.
The DRR has been developed in close collaboration with market participants and stakeholders, including buy- and sell-side firms, trade repositories and technology providers.
The initiative leverages the Common Domain Model (CDM) to transform a mutualised interpretation of the CFTC rule amendments into code — reducing the inconsistencies that can emerge when each firm independently implements its own interpretation of the rules.
The CFTC is the first regulator to amend its swap data reporting framework to incorporate new international data standards, with the initial round of changes due to come into effect on 5 December.
Scott O’Malia, chief executive of ISDA, comments: “The DRR represents a big step forward in bringing greater efficiency to regulatory reporting by establishing a collaborative, peer-reviewed interpretation of the rules that firms can either use as the foundation of their build, or to compare their reading of the rules with the industry view. This will result in better quality, more accurate and more consistent data reported to regulators.”
