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On February 14, 2024, the Taiwan Futures Exchange (TAIFEX) obtained an Exemption From Registration as a Derivatives Clearing Organization (Exempt DCO) from the U.S. Commodity Futures Trading Commission (CFTC), marking a significant milestone in strengthening the ties and collaboration between the financial markets of Taiwan and the United States. TAIFEX was previously granted a one-year No-Action Relief for the central clearing of overthe-counter (OTC) derivatives from the CFTC on September 15, 2022. On September 13, 2023, the No-Action Relief was extended, securing the ongoing participation of U.S. participants in our OTC clearing service. The Exempt DCO status provides a lasting right for TAIFEX to clear OTC derivatives for U.S. participants. TAIFEX now stands as the fifth Exempt DCO recognized by the CFTC.
Since its OTC clearing business commenced on July 25, 2022, TAIFEX has continuously gained recognition from international financial regulatory authorities. In addition to the No-Action Relief and Exempt DCO status granted by the CFTC, TAIFEX has been recognized by the European Securities and Markets Authority (ESMA) on December 31, 2022, as a Third-Country Central Counterparty (TC-CCP). Furthermore, on October 13, 2023, TAIFEX was approved by the Japan Financial Services Agency (JFSA) to be exempted as a clearing counterparty for New Taiwan Dollar Interest Rate Swaps (TWD IRS), effectively expanding the scope of its OTC clearing business and enhancing its competitiveness and international visibility.
Moreover, TAIFEX actively seeks Qualifying Central Counterparty (QCCP) recognition from other countries. This strategic initiative is expected to bolster foreign financial institutions' confidence in the Taiwanese market, improve capital utilization efficiency, and promote the internationalization of Taiwan's financial markets, thereby expanding its global influence.
