Back Dated Adjustments Reporting

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Status: Best Practice Finalised, Last Updated: 26/04/2021

Question:
Reported data that on submission fails validation and, due to missing data or otherwise, continues to NACK for further lifecycle events will need to be reported (replayed) to Trade Repositories to ensure full and correct records are received.

What procedure or practice should be considered regarding backloading?

Best Practice:
The recommendation, due to the technical implications of this question and members' concerns, is that no best practice can be provided. Firms with reporting obligations should consider the implications and related system developments required to align with regulatory text.

See Guidelines Reporting under Articles 4 and 12 SFTR 06 January 2020 ESMA70-151-2838

83. However, the TRs should review the "Event date" only to the extent that they verify that it is not a future date (this is captured explicitly in the validation rules) and:

A. in the case of "past" event dates (i.e. less than reporting date -1), these events do not alter the transactions after their maturity or termination, i.e. the reported event date is earlier than the maturity date and, if populated, the termination date (this is also reflected in the validation rules. TRs should also verify that the modifications sent with a past event date do not alter the previously reported maturity date. Furthermore, the TRs should not apply the reported change to the current Trade State Report (if the transaction is still outstanding) nor the past Trade State Report of the date for which the event was reported.

B. in the case of event dates equal to the reporting date or the day preceding the reporting date, the TR should apply changes to the Trade State Report based on the sequence of submissions.

88. In the case where multiple past submissions were rejected by a TR, the counterparty should correct and resend them as soon as possible and maintain the chronological order of the events. In the case where these previous reports concern events that occurred on the reporting date or day before and therefore would be considered by the TR for the purpose of providing Trade State Report (in line with the paragraph 83 above), the counterparty may also need to resubmit last report(s) to bring the record of the transaction to the most up-to-date state. (SFTR-178)