Members of the industry are not tuning down their protests against the European Commission’s EMIR 3.0 proposal. Following the critical statement released in February this year by four buy-side heavyweights including the European Fund and Asset Management Association (EFAMA), members of the sell side have also made their voices heard in the recently published Clearing Management Insight Report by market intelligence agency Acuiti.

The publication, based on a quarterly survey of more than 100 senior clearing executives from across the global market, revealed that 63 percent were opposed to the proposed new rules. Only eight percent were all for it, while 29 percent said that they could potentially support it.

When the European Commission announced its intention to update EMIR late last year, it was met with disapproval from the industry. The update would include an obligation for EU-based market participants to hold an “active account” at an EU-based clearing house.

Shared concerns

Almost 90 percent of the respondents to Acuiti’s survey cited rising costs for clients as one of the anticipated impacts of the new rules. Nearly 60 percent were concerned about rising costs for their house business, while approximately 25 percent believed that competition in euro-denominated products would decrease. These concerns are in line with the ones expressed in the aforementioned February statement by the four buy-side institutions.

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As for the 29 percent of survey respondents who are currently on the fence, what could sway them in favour of the European Commission’s decision might be more clarity on how the “active account” status is defined. The overall sentiment is that the definition should not be strictly quantitative. Suggestions for alternative parameters include setting a minimum threshold for activity within a certain period.