The European Securities and Markets Authority issued a consultation on Dec. 14 proposing amendments to the European Market Infrastructure Regulation that would permit a "one-day gross" approach to calculating margin requirements for exchange-traded futures and options.
The proposed one-day "margin period of risk" would apply only to client clearing, and would require clearing firms and clearinghouses to meet certain requirements, including the collection of intraday margin. In addition, this approach would complement, not replace, the existing account structures based on two-day gross.
The amendments to EMIR would clear the way for the EU to recognize that U.S. clearing standards are equivalent to EU clearing standards and would remove an obstacle to the recognition of U.S. clearinghouses in Europe. However, time is short. Any European banks that are members of clearinghouses that are not recognized by June 15 will face a substantial jump in their capital requirements. That deadline was previously set for December 2015, but on Dec. 12 the European Commission officially extended it by another six months.
Separately, ESMA signed agreements in November with regulators in Canada and Switzerland. The agreements establish information-sharing arrangements regarding clearinghouses in those two countries that have applied for recognition under EMIR.
