Clarification on cleared OTC derivatives

The fact that a derivative contract is traded in an OTC market which, according to Regulation 648/2012 in the EU and to the Dodd-Frank Act in the US, requires clearing through a Central Counterparty (CCP) does not imply that such OTC market becomes an organized market for the purposes of reporting FINREP templates. Therefore, if a reporting entity enters into a derivative contract in an OTC market where central clearing is compulsory, it shall classify that derivative as "OTC market" and not as "Organised market" (understood for this purpose as an "regulated market" as set out in article 4(92) of the CRR).   The allocation of a transaction as "OTC" or "Organized market" shall be based on the nature of the market where the transaction takes places and not on whether there is a mandatory clearing obligation for that transaction.