At A Glance

The table below indicates some of the broad categories of derivatives which are generally considered in scope for IM under UMR for each of the US PR, EU, Swiss and Japan rulesets. However, please note that a full analysis of the product and its specific product features and the relevant margin rules should be undertake before coming to any definitive conclusion as to its regulatory treatment. Note the scope may be different for AANA assessment and variation margining requirements.

UBS AG will be directly subject to

1. Swiss rules (note, UBS will not be relying on EMIR equivalency/substituted compliance);
   
2. b) US Prudential Regulators' (PR) rules will apply when (a) trading out of one of its US branches with any counterparty; or (b) trading out of one of its non-US branches with a US Entity counterparty or a non-US Entity counterparty that is guaranteed by a US Entity. "US Entity" for this purpose includes an entity organized under US laws (including any of its non-US branches or offices), a US branch of a non-US entity, a U.S. resident natural person, and a swap entity (i.e. registered swap or security-based swap dealer or registered major swap or security-based swap participant) that is a subsidiary of a US entity;
   
3. EMIR (where acting out of an EU branch and facing an EU branch of a non-EU counterparty);
   
4. Japanese rules when trades are booked into a branch in that jurisdiction with any in-scope counterparty;
   
5. Australian, Hong Kong or Singapore rules when trades are booked into a branch in that jurisdiction with any in-scope client. However, the margin rules in these jurisdictions permit UBS to rely on substituted compliance with the Swiss rules. It is UBS's intention to rely on these substituted compliance provisions and solely apply the Swiss rules.
   

UBS Europe SE will be directly subject to EMIR

This may result in multiple margin rules applying to a single trading relationship, particularly once the rules applicable to the jurisdiction of both parties are taken into account. Where this occurs, unless and until any substituted compliance is permitted, UBS's approach is to apply the strictest elements from a combination of the applicable rulesets to the trading relationship.

UMR requires in-scope entities to have relevant margin documentation in place by the required regulatory deadline and to begin exchanging regulatory IM once a €50 million (or relevant currency equivalent) threshold has been exceeded (the "IM Threshold"). In some cases, monitoring of the IM threshold alone may be sufficient before the obligation to exchange margin is triggered. See the "Advocacy" section.

Any existing house IM requirement with UBS will remain in place regardless of the UMR requirements. For further information regarding margin documentation, see “Legal Documentation” under the FAQs section.

This will be determined based on the applicable regimes, the total amount is aggregated across both variation and initial margin. Note that each of the IM and VM documentation will specify an MTA.

The threshold is applied at a group level and would need to be allocated across entities impacted by the regulation. UBS would typically agree an amount with an FX buffer to allow for currency movements across the different regulations. Please note this threshold applies to regulatory IM only and is not applicable to any existing non-regulatory initial margin arrangement we may have in place with you.

No. If you exclusively trade out-of-scope products with UBS there is no requirement to repaper. Please do however, check your trading relationship with UBS against in the in-scope product table under item 2 to be certain that you are not captured under any of the UMR rulesets.

The UMR requirements apply to uncleared OTC derivative transactions entered into or novated after the relevant regulatory deadline. In addition, material restructurings of existing transactions entered into before the applicable regulatory deadline effected after such date will bring such transactions into scope of the requirements where, broadly speaking, the amendment has the equivalent economic effect of entry into a new transaction. To the extent existing transactions are not materially amended after the applicable regulatory deadline they will generally not be impacted by UMR.