European Commission
EMIR - Commission Implementing Decision on extending UK CCP equivalence published in OJ and European Commission consults on review of EU central clearing framework - 9 February 2022
Commission Implementing Decision (EU) 2022/174 has been published in the Official Journal of the European Union (OJ) and entered into force on 10 February 2022. The Commission Implementing Decision determines that, until 30 June 2025, the regulatory framework that applies to UK-based central counterparties (CCPs) is equivalent to the European Market Infrastructure Regulation (648/2012/EU) (EMIR). This will extend the temporary equivalence of UK CCPs to that date following the expiry of the previous Commission Implementing Decision on 30 June 2022. The Commission adopted the draft Implementing Decision (C(2022 831 final) on 8 February 2022.
The Commission has also published a targeted consultation on a review of the EU central clearing framework. The Commission is seeking stakeholders’ views on a number of areas, including:
- widening the scope of clearing members and clients accessing CCPs to include entities such as pension schemes, private entities that do not access CCPs directly and public authorities;
- widening the scope of the products offered for clearing or that are required to be cleared to include products such as equity derivatives, repos and foreign exchange derivatives;
- measures aimed at market participants, such as ways to reflect the greater systemic importance of Tier 2 third-country CCPs in the context of banking rules and supervision, and the potential use of macroprudential tools to address financial stability risks arising from over-reliance on Tier 2 CCPs;
- measures aimed at EU CCPs, such as ways to support them in expanding their range of clearing services and improving the current set up of payment and settlement arrangements available to them in the EU;
- introducing a monitoring process to measure EU market participants’ progress towards reducing their exposures to Tier 2 CCPs;
- strengthening the supervisory framework for EU CCPs and giving EU-level supervision a stronger role, in order to better address risks involved in increased cross-border clearing activity, simplify and accelerate procedures, remove legal uncertainties and facilitate co-ordination with third country supervisory authorities; and
- clarifying the interaction between EMIR and other relevant legislation such as the Markets in Financial Instruments Directive (2014/65/EU) (MiFID II) and the Directive relating to undertakings for collective investment in transferable securities (2009/65/EC) (UCITS Directive).
The deadline for responses is 8 March 2022. The Commission has also published a call for evidence on an impact assessment and intends to adopt any legislative proposals in Q3 2022.
Commission Implementing Decision (EU) 2022/174) of 8 February 2022 determining, for a limited period of time, that the regulatory framework applicable to central counterparties in the United Kingdom of Great Britain and Northern Ireland is equivalent, in accordance with Regulation (EU) No 648/2012 of the European Parliament and of the Council
Webpage
Press release
European Commission Consultation Document: Targeted consultation on the review of the EU central clearing framework
Webpage
Call for evidence for an impact assessment (Ares(2022)899227)
UK Parliament
UK-EU financial services - House of Lords European Affairs Committee announces inquiry - 4 February 2022
The House of Lords European Affairs Committee (the Committee) has announced the launch of a new UK-EU financial services inquiry. The Committee notes that the UK-EU Trade and Cooperation Agreement (TCA) contains only limited provisions on financial services trade between the UK and the EU. Since the TCA was signed, the EU has only granted the UK two equivalence decisions for financial services, both of which have been limited and one of which has since expired. Conversely, the UK has granted equivalence to EEA member states in 28 of the 32 areas identified for the equivalence process.
The inquiry will consider matters including:
- the impact so far on the UK financial services sector of the UK’s departure from the EU single market;
- the impact of the absence of a functioning framework for UK-EU regulatory cooperation;
- the future of cross-border UK-EU financial services trade in the absence of equivalence; and
- the impact of regulatory divergence and agreements with third countries on UK-EU financial services trade.
The Committee indicates on its accompanying webpage that there will be an oral evidence session on 8 February 2022.
The Committee expects to report by May 2022.
Inquiry page: UK-EU relationship in financial services
Press release
