EBA consults on reporting framework for ISDA SIMM validation and monitoring

The European Banking Authority (EBA) is consulting on a new reporting framework to support the validation and ongoing monitoring of initial margin models based on the ‘Standard Initial Margin Model’ (SIMM) developed by the International Swaps and Derivatives Association (ISDA). The proposed reporting requirements will provide the EBA with the necessary information to perform its role as central validator of pro forma models under EMIR, while ensuring a proportionate approach for reporting entities.

The consultation runs until 2 November 2026. Since 1 March 2026, the EBA has acted as the central validator of pro forma initial margin models under EMIR. To support this role, the EBA proposes a standardised set of regular reporting requirements for counterparties seeking validation to use ISDA SIMM.

The proposed framework aims to enable collection of consistent, high-quality information on initial margin models’ use and performance. It will also facilitate the calculation of annual validation fees.

A key feature is its focus on proportionality. The scope, content, and frequency of reporting are designed to provide the EBA and authorities with necessary oversight information while minimizing compliance costs. Firms with less significant OTC trading activities will have lighter reporting obligations, requiring only annual submissions.

Comments can be submitted via the “send your comments” button on the EBA consultation page. The deadline is 2 November 2026. All comments will be published unless requested otherwise.

Following the consultation, the EBA plans to adopt a decision by the end of 2026 to establish the data collection. The first reporting date is expected in December 2027, with data collection starting in the first quarter of 2028. These requirements will be included in the EBA technical package version 4.4, Phase 2, expected to be released in March 2027.

The EBA will collect data directly from reporting entities, with operational arrangements to be communicated later.

Legal background: Regulation (EU) No 648/2012 (EMIR), as amended by Regulation (EU) 2024/2987 (EMIR 3), introduces new requirements for initial margin models for OTC derivatives. Under EMIR Article 11(12a), the EBA is mandated to validate pro forma models, including ISDA SIMM. The EBA’s validation function became operational on 1 March 2026. This consultation specifies the information required for ongoing validation and monitoring, supporting authorities in supervision and authorization processes.