Recital 14

(14)In order to ensure that authorities can effectively fulfil their mandates, in particular related to financial stability, it is necessary that they have a clear and complete picture of all derivatives with outstanding risk. Only a harmonised requirement to duly update all outstanding derivatives can prevent divergences in the implementation of reporting requirements applying to outstanding derivatives and hence mitigate the risk of undermining supervisory convergence. Furthermore, ensuring that reports pertaining to outstanding derivatives are aligned in terms of data content and data quality, allows for simplification of the reporting flows thus resulting in the long term in reduction of costs for all relevant stakeholders, including trade repositories, reporting entities and authorities. Thus, to secure improvement of the functioning and reduction of the burden of reporting, in line with the objectives of the amendments of Regulation (EU) No 648/2012 introduced by Regulation (EU) 2019/834 of the European Parliament and of the Council ⁴ , it is essential that counterparties report complete and accurate details of all outstanding derivatives in accordance with the currently applicable requirements. To mitigate the initial burden related to the update of outstanding derivatives, additional time should be granted for the counterparties to update the data pertaining to the outstanding derivatives. Furthermore, counterparties should be required to submit such update only if no modification occurs within that time that would require the counterparty to report complete and accurate details of the derivative in a report pertaining to that modification.