Firms bound by UK and European reporting regulation will need to run parallel projects as first Europe then the UK update their rules next year, a reporting expert at Broadridge has said.

Speaking on a webinar on Thursday hosted by fintech Broadridge Financial Solutions, its head of regulatory reporting product David Farmery warned that firms preparing to comply with both European and UK rules will have to manage the gap between the rules coming into force. The new European Market Infrastructure Regulation (EMIR) rules take effect on April 29 next year while new rules under the post-Brexit UK system are likely to be introduced in September.

“We’ll find out when the Financial Conduct Authority publishes their specifications but there aren’t expected to be many differences between the two regimes beyond slight changes," Farmery said. “We have this scenario where you could have a five-month gap between when EMIR goes live and the UK FCA goes live, so if you are doing both you’ll need to keep your legacy systems up and running for that period.

“There will be a challenge of standing up a new environment for EMIR, and then you have another project to keep that legacy system running and migrate it over, so it's certainly challenging from a project point of view.”

Francesco Angelini, EMIR reporting director from specialist firm Kaizen Reporting, warned that firms should not assume similarities or treat the two regimes as interchangeable.

“As an industry we need to be aware that the FCA/Bank of England are working in tandem on this alongside the Treasury,” he said. “We expect the policy statement to be issued around the end of March, so from that perspective it will be interesting to see what they agree once the industry has given its views through the consultative process. Firms do need to realise that it is two separate regimes regardless of the differences.”

Speaking to Global Investor in July, the DTCC’s head of product development and strategy Val Wotton warned that divergence in the rules or timelines would need firms to run separate projects for UK reporting rules.

Research firm Acuiti in May said the increase in data fields and mandatory matching under EMIR Refit will make reconciliation a major issue for reporting entities.