Digital regulatory reporting

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Digital regulatory reporting

DRRAlso called machine-executable reporting

Definition

Digital regulatory reporting (DRR) turns the text of reporting rules into machine-executable code that firms run against their own data to produce reports. Instead of each firm interpreting rules separately, the industry agrees one coded version. The best-known use is derivatives trade reporting, where the open-source code covers rule sets in several jurisdictions.

RULE TEXTDATA MODELEXECUTABLE CODEREPORT OUTPUT
Fig. 1 · Digital regulatory reporting
CFTC Part 45 amendments · EMIR Refit · UK EMIR Refit
Key rulesCFTC Part 45 amendments · EMIR Refit · UK EMIR Refit
Applies toSwap dealers and other swap counterparties
RegionsGlobal · UK · EU · US
01

How it works

Rule text is translated into a standard data model and code that defines each reportable field, its source data and its logic. Firms feed trade data in and the code produces the report in the required format, such as ISO 20022. When regulators amend a rule, the shared code is updated once and firms adopt the new release rather than rebuilding their own logic.

Banks spend heavily on reporting, and differing interpretations of the same rule cause errors that regulators then chase. A shared coded reading cuts duplicated work and gives firms a clear audit trail from rule to output. UK regulators ran DRR pilots in 2018 and 2019, and derivatives trade reporting rewrites under CFTC rules and EMIR Refit used it in production.

Step 1Model the ruleTranslate rule text into a common data model.
Step 2Code the logicWrite executable logic for each reportable field.
Step 3Run on dataProcess firm trade data through the coded rules.
Step 4Update releasesAdopt new code versions when rules change.
02

The rules

US · 5 December 2022CFTC Part 45 amendmentsCFTC Swap Data Recordkeeping and Reporting Requirements, amended Part 45

Rewrote US swap reporting fields and validations; the first production use of industry DRR code began on this compliance date.

Swap dealers and other swap counterparties
EU · 29 April 2024EMIR RefitCommission Delegated Regulation (EU) 2022/1855 and Implementing Regulation (EU) 2022/1860 on EMIR reporting

Revised EU derivatives reporting fields and required ISO 20022 XML reports from 29 April 2024.

Counterparties to derivative contracts
UK · 30 September 2024UK EMIR RefitRevised UK EMIR reporting standards from the FCA and Bank of England

Updated UK derivatives reporting fields and formats, applying from 30 September 2024.

UK counterparties to derivative contracts
03

Common questions

Is digital regulatory reporting a regulation?

No. DRR is a method, not a law. It codes existing reporting rules so firms can apply them consistently. Firms remain fully responsible for the accuracy of their reports whether or not they use shared code.

Which reporting regimes use DRR?

Industry DRR code covers derivatives trade reporting under CFTC rules in the US, EMIR in the EU and UK, and regimes in Japan, Australia, Singapore, Hong Kong and Canada. Coverage of MiFIR, SFTR and Swiss rules is being extended.

How is DRR different from machine-readable regulation?

Machine-readable regulation publishes rule text in a structured format computers can parse. DRR goes further by turning the rule's logic into executable code that produces the report itself from firm data.

What is the Bank of England's Transforming Data Collection programme?

It is a joint Bank of England and FCA programme to change how UK regulators collect data. Its focus areas are integrated reporting, modernised reporting instructions and common data standards, building on earlier work with firms on digital regulatory reporting.