MISP: Good News, Bad News The EU Market Integration & Supervision Package - A Treasurer’s Scorecard

Regulatory advisory note · François Masquelier, Simply Treasury / EACT · June 2026 · Status: trilogue pending.

Executive summary

The EU Market Integration and Supervision Package (MISP), published by the European Commission on 4 December 2025 and now advancing through the European Parliament’s ECON Committee, is a landmark but double-edged regulatory reform for corporate treasurers. Two proposed EMIR amendments offer meaningful administrative relief: the streamlining of the intragroup notification regime and the formalisation of Single-Sided Reporting (SSR). Both are positive developments that EACT should actively support. However, a third amendment, the proposed removal or narrowing of the MiFID II ancillary activity exemption for commodity derivatives, carries significant regulatory and commercial risk for non-financial corporates engaged in commodity hedging. This note summarises the MISP landscape, EACT’s updated position on SSR, and answers four specific questions on the intragroup exemption, derivative margining, hedging definitions, and the ancillary activity exemption.

1. What is MISP? Context and legislative status

The Market Integration and Supervision Package (MISP) is a comprehensive legislative initiative published by the European Commission on 4 December 2025 as a central pillar of its Savings and Investment Union (SIU) strategy. Spanning over 1,000 pages across three legislative instruments, it constitutes the most substantial single-market integration move in EU capital markets since MiFID II and EMIR were first enacted.

MISP: three legislative instruments

1. Master Regulation — amends MiFIR, EMIR, CSDR, SFTR, MiCAR, DLT Pilot, Benchmarks, Securitisation, ESG Ratings. Directly applicable.
2. Master Directive — targeted amendments to MiFID II, AIFMD, UCITS. Requires national transposition.
3. Settlement Finality Regulation — converts the Settlement Finality Directive into a directly applicable Regulation.

Legislative timeline: ECON Committee draft reports published 12 June 2026; ECON vote targeted 1 December 2026. Trilogue negotiations are expected throughout 2026 to 2027, with application likely between 2027 and 2029 (12 to 24 months after adoption).

MISP is included in the “One Europe, One Market” roadmap presented at the informal European Council of 24 April 2026, with end-2026 as the target for political agreement. The ECON Committee rapporteur, Markus Ferber, published draft amendments on 12 June 2026. Other ECON members may table further amendments until 16 July 2026. For corporate treasurers, MISP’s relevance is concentrated in three areas: EMIR reporting reform (SSR and the intragroup exemption), EMIR margining, and the MiFID II ancillary activity exemption for commodity derivatives. Each is assessed in turn below.

2. The treasurer’s MISP scorecard: good news and bad news

Good news #1 — EMIR Single-Sided Reporting (SSR): simplification that works

Under current EMIR, both counterparties to an OTC derivative contract are required to report the transaction independently to a trade repository. This dual-sided reporting model generates significant operational cost, reconciliation burden, and data quality issues, since both counterparties report the same trade from their own perspective, with inevitable discrepancies. ISDA has estimated this as one of the most material cost drivers in the current EMIR framework.

MISP proposes to move to Single-Sided Reporting (SSR), under which only one counterparty, determined by a priority waterfall (Financial Counterparty > NFC+ > NFC-), is responsible for reporting both sides of the trade. This aligns EU practice with global norms in jurisdictions that have already adopted SSR.

EACT position on SSR (updated, June 2026). EACT acknowledges SSR as a positive simplification and broadly supports the direction of reform. The administrative burden reduction is real and meaningful. However, EACT recommends maintaining an opt-in regime allowing NFCs to report on a voluntary basis, for three reasons:

1. It safeguards the operational capabilities that NFCs have already built to report independently.
2. It preserves the ability to report independently in cases where the reporting counterparty’s data may not accurately reflect the NFC’s position.
3. It aligns with the obligation under EMIR to provide the reporting counterparty with the details of OTC derivative contracts; preserving this process discipline is commercially prudent.

EACT’s position: support SSR as the default regime while advocating a voluntary opt-in for NFCs who wish to maintain their own reporting capability.

Good news #2 — EMIR intragroup exemption: notification streamlining

MISP proposes to streamline the intragroup transaction reporting exemption by applying it at group level rather than bilaterally between each pair of counterparties. Concretely, where a group currently needs to submit individual notifications for each intragroup pair, a single consolidated notification submitted by the parent (or highest EU consolidating entity) would suffice. The ECON rapporteur Ferber has explicitly proposed, in his June 2026 draft amendments, that the EMIR intragroup transaction reporting exemption be applied at group level, a significant clarification of the Commission proposal.

Verdict: positive for treasury teams. This is a genuine administrative simplification for large multinational groups with extensive intragroup derivative activity. It reduces the notification workload substantially and removes the bilateral symmetry currently required. EACT should support this amendment actively.

Bad news — MiFID II ancillary activity exemption: a significant risk for commodity hedgers

The most consequential and concerning element of MISP for non-financial corporates is the proposed amendment to the MiFID II ancillary activity exemption (Article 2(1)(j) MiFID II). This exemption currently allows commodity derivative traders whose activity is ancillary to their main business to operate outside the full MiFID II investment firm regulatory perimeter. MISP’s Master Directive proposes changes to the regime governing ancillary activities in relation to commodity derivatives trading. If the exemption is removed or materially narrowed, the consequences for affected corporates would be severe.

Regulatory consequences if the ancillary activity exemption is removed:

1. Full investment firm authorisation required under MiFID II.
2. Prudential requirements under the Investment Firms Regulation/Directive (IFR/IFD): capital, liquidity and leverage requirements.
3. MiFID II governance obligations: senior management requirements, risk management frameworks, conflicts of interest policies.
4. MiFID II transaction reporting obligations: real-time trade reporting to regulators.
5. Reclassification as Financial Counterparty (FC) under EMIR: loss of NFC+ status and its associated regulatory advantages.
6. FC status triggers: mandatory clearing obligations, mandatory initial and variation margin, enhanced reporting.
7. Scope: affects ALL derivative transactions, not only commodity derivatives. Once classified as FC, the full EMIR FC regime applies across all asset classes.

The key practical danger is the “all-or-nothing” nature of the MiFID II investment firm classification: a corporate that loses the ancillary activity exemption does not simply become regulated for its commodity derivatives, it becomes subject to the full investment firm regime for all of its financial activities. As ESMA has confirmed, a firm cannot be MiFID-exempted for one asset class and MiFID-regulated for another simultaneously.

Verdict: serious risk, active advocacy required. EACT should: (1) formally comment on the MISP consultation in support of preserving the ancillary activity exemption; (2) alert members engaged in commodity derivative trading to assess their current reliance on the exemption and model the regulatory impact of its removal; (3) engage with the ECON Committee rapporteur and Member State delegations to flag the disproportionate impact on non-financial corporates before the 16 July 2026 amendment deadline.

3. Specific questions answered

Q1 — Intragroup exemption with a non-EU counterparty: what is the current position?

The notification streamlining proposed under MISP covers the EU intragroup exemption. Where a group’s parent is not established in the Union, the highest consolidating entity established in the EU may submit the single consolidated notification on behalf of the group. However, Article 13 EMIR remains in force for non-EU counterparties: an equivalence decision by the Commission is still required for non-EU entities to benefit from the full intragroup reporting exemption. ESMA’s Q&A on EMIR implementation confirms this position.

Practical summary, EU vs non-EU intragroup exemption (June 2026):

1. EU intragroup exemption: streamlined under MISP, single notification by the highest EU consolidating entity. Positive.
2. Non-EU counterparty intragroup exemption: Article 13 EMIR still requires an equivalence decision. Not changed by MISP.
3. Current equivalence decisions in place for: USA, Japan, Canada, Hong Kong, Brazil, Australia, Singapore.
4. Counterparties in non-equivalent jurisdictions: cannot benefit from the intragroup exemption regardless of MISP reforms.

Q2 — Derivative margining reporting for intragroup transactions: clarification

It is important to recall that derivative margining reporting is required only when operating above the clearing threshold (NFC+ status). Below that threshold (NFC-), margining reporting obligations do not apply.

For intragroup transactions specifically, bilateral margining may be exempt where three cumulative conditions are met: (1) both counterparties are part of the same consolidation on a full basis; (2) they are subject to appropriate centralised risk evaluation, measurement and control procedures; and (3) there are no legal or practical impediments to the prompt transfer of own funds or repayment of liabilities within the group. Crucially, the MISP notification simplification affects only the procedural notification process for the intragroup exemption; it does not alter the substantive eligibility conditions for the bilateral margining exemption. An NFC+ entering into intragroup derivative transactions that do not meet all three conditions for the bilateral margining exemption must continue to report margining. There is no change here.

Confirmation. An NFC+ with intragroup transactions not meeting all bilateral margining exemption conditions: margining reporting obligations continue. The MISP notification simplification does not affect this.

Q3 — Definition of hedging: is it being reviewed?

EACT has carefully reviewed the MISP legislative texts and can confirm that the definition of hedging is not subject to amendment under the current MISP package. The hedging definition, which is of fundamental importance to NFC threshold calculation and to the ancillary activity exemption under MiFID II, remains unchanged. EACT will continue to monitor this aspect closely throughout the trilogue negotiations. Any amendment to the hedging definition would have significant consequences for NFCs’ threshold calculations and their ability to exclude hedging positions from the NFC clearing threshold. EACT will flag any developments to members immediately.

Status: no change, monitoring continues. The hedging definition is not being reviewed under MISP as currently drafted. EACT will maintain active monitoring through the trilogue process. This is a red line for EACT advocacy.

Q4 — Implications of removing the ancillary activity exemption: the full picture

This is the question with the most severe potential consequences. If the MiFID II ancillary activity exemption is removed or substantively narrowed for commodity derivative trading, affected corporates would face the following cascading regulatory obligations:

1. Prudential regime: full application of the Investment Firms Regulation (IFR) and Investment Firms Directive (IFD), including own funds requirements, liquid asset requirements, and concentration limits. These are designed for professional financial intermediaries, not industrial or energy corporates.
2. MiFID II governance: senior management approval requirements, risk management frameworks, conflicts of interest policies, remuneration policies, the full governance architecture of an authorised investment firm.
3. Transaction reporting: real-time MiFID II transaction reporting to NCAs/ESMA, separate from and in addition to EMIR derivative reporting.
4. EMIR reclassification: loss of NFC+ status, reclassification as Financial Counterparty (FC). FC status triggers the clearing obligation for all asset classes above the threshold, bilateral margin requirements across the full derivatives portfolio, and enhanced reporting. This is not limited to commodity derivatives: FC status applies globally across all derivative classes.

The removal of the ancillary activity exemption is not a targeted commodity-derivatives measure. It is a systemic reclassification that would pull affected corporates into the full investment firm and financial counterparty regulatory perimeter across all their financial activities.

EACT’s recommended response is clear: members engaged in commodity derivative hedging should (1) assess their current position relative to the ancillary activity threshold tests; (2) model the regulatory and cost impact of FC reclassification; and (3) actively support EACT’s advocacy to preserve the exemption in the ECON Committee amendment process before 16 July 2026.

4. Next steps and timeline

Key dates for treasurers:

1. 16 July 2026 — deadline for ECON Committee members to table additional amendments to the MISP proposals.
2. 1 December 2026 — ECON Committee vote on the negotiating position (targeted).
3. End-2026 — political agreement target (European Council “One Europe, One Market” roadmap).
4. 2027 to 2028 — expected trilogue completion and formal adoption.
5. 2027 to 2029 — application (12 months after adoption for most provisions; 24 months for ESMA supervision provisions).

The window for industry influence on the MISP text is now. The ECON Committee amendment process, closing 16 July 2026, is the most important near-term advocacy opportunity. EACT, through its national member associations and direct engagement with MEPs on the ECON Committee, should prioritise: support for EMIR SSR with an NFC opt-in; support for intragroup exemption streamlining; and vigorous opposition to the removal or narrowing of the MiFID II ancillary activity exemption.

François Masquelier — Simply Treasury / EACT