If EU and US watchdogs share their insights about CCPs with each other, they could give those CCPs more freedom when it comes to doing business in each others’ jurisdictions. That seems to be the basic idea as the US Commodity Futures Trading Commission and Europe’s ESMA present a new collaboration in amicable words.
The newly signed memorandum of understanding covers “cooperation and the exchange of information with respect to certain registered derivatives clearing organizations established in the United States that are central counterparties (CCPs) recognized by ESMA under the European Market Infrastructure Regulation (EMIR)”. In its focus are “the larger U.S. CCPs operating in the European Union”.
Find ESMA’s press release here or the full 20-page MoU here. Yet, if stepped-up supervision is the purpose, that message is padded nicely in expressions of praise for “their mutual cooperative relationship, which has continued to flourish”, and being “pleased” about “entering a phase of closer cooperation”.
A “milestone”
“The deferential approach embodied in this MOU is a major milestone in the years-long engagement between the CFTC and its EU counterparts on the implementation of EMIR as amended,” says Suyash Paliwal, director of the CFTC’s Office of International Affairs, in the press release.
“Through the MOU, ESMA and the CFTC express their desire for enhanced cooperation as to the larger U.S. CCPs operating in the European Union with provisions that expand upon the collaboration set out in the 2016 CFTC-ESMA MOU related to recognized CCPs,” the press release states.