The European Banking Authority will start central validation of the ISDA SIMM model on 1 March 2026, establishing operational and governance arrangements for supervised oversight across the EU.
The European Banking Authority (EBA) will commence the central validation of the International Swaps and Derivatives Association Standard Initial Margin Model (ISDA SIMM) on 1 March 2026.
The Decision on arrangements for ISDA SIMM validation, published today, sets out the operational framework for the EBA’s new validation function. This marks a key step in ensuring consistent, robust, and transparent supervision of initial margin models across the EU.
Under the amended European Market Infrastructure Regulation (EMIR), the EBA is mandated to establish and operate an EU-level validation function for pro forma initial margin models used for non-centrally cleared OTC derivatives.
The EBA confirms that its central ISDA SIMM validation function is operational and will start on 1 March 2026. The related Decision details onboarding, application procedures, governance, cooperation mechanisms with authorities and ISDA, and criteria for ongoing model monitoring and assessment.
In accordance with EMIR, the EBA announced the setup of its validation function and has obtained the list of counterparties using ISDA SIMM following data collection launched on 7 November 2025. The onboarding process will occur in stages, beginning with direct contact with counterparties.
The second phase, starting in August 2026, will invite onboarded counterparties to submit validation applications. The first validation decision is expected in Q4 2026, including the list of affected counterparties. Until then, counterparties may continue using ISDA SIMM models if they have applied for authorization with their competent authorities, in line with EMIR and the EBA’s no-action letter published on 17 December 2024.
Further information on the validation process, timelines, and arrangements will be available soon on the EBA’s website.
