On 8 February, the European Commission consulted on the review of the Central Clearing Framework in the EU. FIA and its members welcome the opportunity to provide feedback on this targeted review and stand ready to discuss these issues with the Commission.
FIA supports any initiatives to incentivise market participants to clear via the development of competitive, efficient, resilient financial market infrastructure globally and in the EU. Enabling innovation will be key for the long-term success of EU CCPs.
FIA strongly recommends the Commission takes into account international practices and continues the coordination of cross-border clearing and capital frameworks at an international level. Global consistency is key and any issues are best addressed at a global level and without discriminating based on the location of a CCP or relevant clearing member.
Any restrictive measures directed at EU market participants could set them at a competitive disadvantage compared to international peers if they cannot provide clearing and market-making services to international clients clearing on other CCPs in third-country jurisdictions.
FIA does not support mandatory changes, such as extending the scope of the clearing obligation in the EU to new entities or new products unless there is a market-driven rationale for such an extension, or compelling clearing to take place via an EU CCP, as that would result in the EU diverging from global regulatory standards and departing from the principles of mutual recognition and harmonisation.
FIA and its members remain convinced that EMIR 2.2 provides European authorities with an effective mechanism and the tools to supervise and oversee systemically important third-country CCPs, which are global clearing houses by their very nature. EMIR 2.2 provides for a finely balanced solution designed for joint supervision of Tier 2 third-country CCPs. This shared oversight is the most optimal outcome for financial stability, supervisors, markets, and market participants.
Regulatory and supervisory cooperation is a critical component of any cross-border market, as interest rates swaps, metals, energy, etc. are traded in global markets.
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