Novation · Concepts · European Finance Observatory

Roles that need it

CCP (Central counterparty)A central counterparty (CCP) is an entity that interposes itself between the parties to trades in one or more markets, becoming the buyer to every seller and the seller to every buyer. It manages counterparty risk through membership rules, margin, a default fund and a default waterfall, and in the EU is authorised under the European Market Infrastructure Regulation (EMIR).
Trade confirmationA trade confirmation is the document or electronic message in which the parties to a trade agree its economic and legal terms. For uncleared over-the-counter (OTC) derivatives the European Market Infrastructure Regulation (EMIR) requires timely confirmation, by the business day after trade for most financial counterparties, and procedures to resolve unconfirmed trades and disputes.
OTC derivative (Over-the-counter derivative)An over-the-counter (OTC) derivative is a derivative contract negotiated and concluded bilaterally between two parties instead of on a regulated market, such as an interest rate swap, a currency forward or a credit default swap. In the EU OTC derivatives are subject to European Market Infrastructure Regulation (EMIR) clearing, risk mitigation and reporting rules.

Updated 31 Oct 2026.