Article 285 paragraph 3 requires that the margin period of risk be increased in certain scenarios. Point (b) of paragraph 3 includes the requirement to increase the MPOR if the netting set contains an “OTC derivative that cannot be easily replaced”. By definition “OTC derivative” does not include listed / exchange trades derivatives, as a result the assessment of “cannot be easily replaced” required in 3(b) is limited in scope to OTC derivatives. 

The final sentence of paragraph 3 states “An institution shall consider whether trades or securities it holds as collateral are concentrated in a particular counterparty and if that counterparty exited the market precipitously whether the institution would be able to replace those trades or securities.” It is unclear whether this is a clarification of 3(b) meaning the reference to “replace those trades” would be in relation to OTC derivatives or alternatively whether the reference to “replace those trades” is broader than OTC derivatives?