(3)In order for a third country's legal, supervisory and enforcement regime to be considered equivalent to the regime of the Union in respect of operational risk mitigation techniques and margins requirements, the substantive outcome of the applicable legal, supervisory and enforcement arrangements should be equivalent to Union requirements under Article 11 of Regulation (EU) No 648/2012, ensure protection of professional secrecy that is equivalent to that set out in this Regulation; and the legal, supervisory and enforcement arrangements should be effectively applied and enforced in an equitable and non-distortive manner so as to ensure effective supervision and enforcement in that third country. The purpose of this equivalence assessment is therefore to verify that the legal, supervisory and enforcement arrangements of Japan ensure that OTC derivative contracts not cleared by a CCP and entered into by at least one counterparty established in that third country do not expose financial markets in the Union to a higher level of risk and consequently do not pose unacceptable levels of systemic risk in the Union.