Beyond Compliance: Sharpening your EMIR Refit reporting under CSSF scrutiny

As part of the REgulatory FITness Program to enhance data quality and reporting efficiency, the European Market Infrastructure Regulation 2019/834 (EMIR Refit)—in force since 29 April 2024—imposes more stringent controls on data validation and reconciliation, resulting in stricter rejection criteria at the level of Trade Repositories.

The CSSF has been actively assessing the implementation of the EMIR Refit requirements by Luxembourg-based counterparties, including the evaluation of arrangements relating to internal governance and risk management frameworks, intragroup transactions and the delegation of reporting obligations. This assessment has revealed recurring issues, prompting firms to upgrade their reporting systems, improve data accuracy, and meet enhanced validation and reconciliation requirements. This increased regulatory scrutiny highlights the critical need for timely and precise reporting.

• 720M

  EMIR reports received by the CSSF in 2023¹ - each report a potential data quality risk

• €9,000B 

  of EMIR reports sent everyday to the CSSF by 11,500 counterparties¹

• €30,205 EMIR 

  fine imposed to an IFM for reporting and delegation breaches found during a CSSF onsite-inspection¹

¹ CSSF Annual Report 2023, Annual report 2023

EMIR Reporting Lifecycle: Standard Process and Handling of Rejection

Reporting under EMIR does not end at submission—see below for the process to manage rejections and address data quality issues effectively:

As per Article 9(1) of the ITS and the ESMA Guidelines on EMIR, entities must notify the CSSF of:

> System flaws causing misreporting that impacts a significant number of reports;
> Reporting obstacles preventing timely submission to trade repositories;
> Significant reporting errors that are not rejected by trade repositories under Delegated Regulation (EU) 2022/1858.

Key Reporting Issues Identified by the CSSF

In 2025, the CSSF flagged major challenges faced by Luxembourg entities under EMIR Article 9, resulting in the liquidation of an asset manager for governance and reporting breaches, and a substantial fine imposed on an IFM for deficiencies in reporting and delegation oversight.

Delegated Reporting ≠ Delegated Responsibility

Delegating EMIR reporting does not transfer legal responsibility. Firms must maintain robust oversight to ensure accuracy and compliance.

Key takeaway

While many firms delegate reporting tasks, this does not eliminate the need for internal oversight. Over-reliance on third parties can lead to gaps in reconciliation and monitoring, increasing the risk of non-compliance.

A year after the entry into force of the new requirements, Forvis Mazars in Luxembourg has observed frequent issues occurring across the financial sector, including:

> Mismatch in trade representation: One frequent issue arises when the internal recording of a trade differs from its delegated reporting. For instance, a firm might record an FX Swap as two separate FX Forwards internally, which could qualify for certain exemptions, leading to a discrepancy in the reported data.

> Failure to update legal entity identifiers: Outdated Legal Entity Identifiers (LEIs) are a significant cause of reporting rejections. This often occurs when firms delegate reporting but lack a robust procedure to continuously monitor and provide updated LEIs to their reporting counterparties.

> Delayed error rectification: Errors in delegated reports can persist across multiple submissions if not promptly identified and corrected. A common example is the misclassification of a counterparty (e.g., as a Financial Counterparty (FC) instead of a Non-Financial Counterparty (NFC)), which goes unaddressed due to insufficient oversight procedures and a lack of timely communication with the reporting counterparty.

These recurring data quality issues and reporting rejections underscore a critical need for robust oversight. Effective oversight is not just a compliance checkbox; it is a strategic enabler. Its key benefits include:

• Ensuring regulatory compliance
• Enhancing operational transparency across all levels of your organization
• Building stakeholder confidence, particularly with internal and external auditors, regulators, and boards
• Informing strategic decision-making by providing a clear and comprehensive view of derivatives usage and hedging effectiveness, ultimately leading to cost-efficiency

CSSF recommended controls

On 18 March 2025, the CSSF published a communiqué identifying the most frequent errors in derivative transaction reports since the updated reporting requirements under EMIR Refit came into effect in April 2024. Hence, the CSSF issued recommended controls to prevent the most frequent type of rejection reasons and reminded entities of the importance of avoiding rejected reports when reporting under Article 9 of EMIR.

How Forvis Mazars can help

Navigating the complexities of EMIR Refit reporting and addressing CSSF expectations can be challenging. Forvis Mazars can provide support in several ways:

	Expert Regulatory Assessment • Independent and objective review of existing reporting processes • Identification of gaps relative to CSSF expectations • Benchmarking against industry best practices • Prioritization of remediation actions based on regulatory risk
	Comprehensive remediation strategy • Development of tailored remediation roadmap • Design of enhanced control frameworks • Creation of implementation timelines aligned with regulatory expectations
	Implementation Support • Technical expertise for system enhancements • Development of policies and procedures • Creation of testing strategies to validate solutions • Training program development and delivery
	Post-Implementation Assurance • Independent validation of remediation effectiveness • Ongoing monitoring framework design • Preparation for future regulatory inspections • Knowledge transfer to internal teams

Regulatory references