CFTC

Regulatory reform is ongoing and the role of independent bodies such as IOSCO in standard setting can be crucial.

New European capital rules are set to be postponed amid ongoing talks between the EU and SEC.

The European Securities and Markets Authority (ESMA) and the Commodities Futures Trading Commission (CFTC), ESMA’s US equivalent for futures market oversight, have officially come to agreement over equivalence between the clearing frameworks of the two jurisdictions. It spells the end of a long running dispute between the world’s two largest derivatives markets that has held up the implementation of mandatory central clearing, a key tenet of the G20’s 2009 Financial Reform Programme.

The idea of trade reporting was central to the 2009 G20 financial reform response to the global crises that swept through international markets. The idea was a simple one; get all trading counterparties to report their transactions and then global regulators would have previously impossible transparency into global financial activities. As with many things, however, theory and practice and have been far removed from one another.

On 29 April, ESMA (the European Securities and Markets Authority) recognised 10 third country CCPs (central counterparty clearinghouses), meaning that they can offer clearing services to European market participants on an equivalent basis to their European counterparts. The jurisdictions in which they operate have been deemed equivalent by the European Council in regards to their rules and regulations governing clearing houses.

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