Document ID: chunk:federal_register_of_legislation:F2022L01578:front:0:p15
Version: federal_register_of_legislation:F2022L01578
Segment Type: other
Provision Reference: 
Character Range: 39408–42500

Prudential Standard.
63.         APRA may require an APRA covered entity to exchange variation margin and/or post and collect initial margin with any other entity within the APRA covered entity's margining group where APRA deems appropriate to do so.

Cross border application of margin and risk mitigation requirements
64.         Attachment D to this Prudential Standard sets out the margin requirements or provisions of a foreign jurisdiction that are comparable in outcomes with the BCBS-IOSCO framework and the margin requirements in this Prudential Standard.[23]
65.         Subject to paragraph 66 of this Prudential Standard, the margin requirements in this Prudential Standard do not apply to transactions in which an APRA covered entity complies with the relevant foreign margin requirements or provisions in Attachment D to this Prudential Standard in their entirety (substituted compliance).[24]
66.         An APRA covered entity may only substitute compliance with the margin requirements or provisions (in their entirety) of a foreign jurisdiction for compliance with the margin requirements in this Prudential Standard in a transaction where:
(a)          the APRA covered entity is transacting with a covered counterparty that is required to exchange margins in respect of the trading relationship between the APRA covered entity and the covered counterparty under the margin requirements or provisions of the relevant foreign jurisdiction, or that would be required to exchange margins in respect of that trading relationship under those requirements or provisions if its amount of non-centrally cleared derivatives exceeded a level specified in those requirements or provisions; or
(b)          the APRA covered entity is required to exchange margins in respect of that trading relationship under the margin requirements or provisions of the relevant foreign jurisdiction.
67.         Where a foreign ADI, Category C insurer or EFLIC is directly subject to:
(a)          margin requirements that are substantially similar to the BCBS-IOSCO framework by its home jurisdiction; or
(b)          risk mitigation requirements that are substantially similar to IOSCO's Risk Mitigation Standards by its home jurisdiction,
it may comply in their entirety with its home jurisdiction's margin or risk mitigation requirements (as the case may be) or those of a jurisdiction deemed equivalent by its home jurisdiction in lieu of complying with the relevant requirements in this Prudential Standard where the APRA covered entity has completed an internal assessment that positively demonstrates: (i) how it is directly subject to requirements of the foreign jurisdiction; (ii) how the requirements of the foreign jurisdiction are substantially similar to the BCBS-IOSCO framework or IOSCO's Risk Mitigation Standards (as the case may be); and (iii) how it complies with those requirements. The APRA covered entity's internal assessment, and any additional requested information, must be made available to APRA upon request.
68.         Where a member of an APRA covered entity's Level 2