The European Association of CCP Clearing Houses (EACH) has published a manifesto for efficient and resilient capital markets. Comprising three key points for efficiency and resilience, the document is meant to underscore “the critical role of central counterparties (CCPs) in managing financial market risks, supporting stability, and contributing to economic growth”.
The first key point draws out nine factors that are necessary to support “a competitive and resilient clearing ecosystem for a robust and thriving economy”. They include good central bank access achieved by “simplified and harmonised frameworks for liquidity and risk management”, streamlined approvals for new products and risk models under the European Market Infrastructure Regulation (EMIR 3.0), and targeted rule making that “considers the specificities of CCP services, avoiding duplicative or conflicting requirements”.
The second point emphasises the importance of having “stability in regulation and a dedicated approach to support business development”. EACH suggests that regulations should be proportionate and tailored to CCPs’ risk management roles. In order to “foster market innovation and business development”, regulations should avoid unnecessary complexity.
Lastly EACH is calling for international consistency. Global regulatory alignment would “eliminate inconsistencies and foster fair competition”.
