Read the Letter Here

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Treliant Takeaway:

Recent communications suggest that the CFTC, like ESMA, will mandate the use of ISO 20022 for swaps reporting during 2023.  A move toward further standardization of the market on a small number of trade data formats is welcome, but brings opportunities and challenges that will require a combination of data skills and financial instrument knowledge.

With respect to the ISO 20022 and UPI data standards, the Division does not believe that this no-action letter necessitates any change to the Commission’s previously noted intention to require the use of those standards when they become available.11 The Division currently expects the use of those standards to be required by the Commission in Q4 2023. — CFTC No-Action letter, January 31, 2022

Treliant’s consulting team has deep expertise in derivatives instruments and operations, in data management and control functions.


ISO 20022 is mature in the payments space but is a relative newcomer in derivatives markets.  The standard brings capabilities which were absent in widely used derivatives trade data standards such as FPML.

  • ISO 20022 is extensible but does not permit free-form extension by individual participants. Instead, there is a mature and process for proposing and approving new message types to extend the standard.  The ISO 20022 Repository Management Group facilitates and co-ordinates the work of multiple Standards Evaluation Groups to ensure that the messages added to the standard reflect industry needs.  Market participants may benefit by maintaining a presence in these groups.
  • ISO 20022 is normally represented in XML, but the standard is independent of the specific physical format. This opens the possibility of using more efficient formats that can be transformed and validated faster than XML – potentially an important point given tightening swaps reporting deadlines.
  • While ISO 20022 is relatively new to the derivatives world and to the American market, it is mature in many domains such as European cash and card payments. This means that unlike some trade data standards, there is already a mature set of processes and practices that organizations can adopt.

In the long term, ISO 20022 offers significant benefits, but some swaps compliance teams predict that the total work involved in the changeover, when it comes, will be bigger than this year’s CFTC ReWrite.  In addition to the work of moving to a standard that, in this area, is less mature, there will be extensive changes to at both data management level (message and field definitions) and system level (message generation and transformation), as well as QA and testing needs.