FESE warns about the consequences of the disparity between US and EU CCP margin standards for exchange-traded derivatives. It is vital that the European authorities take concerted action to close this loophole in global derivative exchange regulation before these companies take the decision to move their trading interest to other jurisdictions.
In order to avoid a clash between the EU and the US and a potential loss of competitiveness of the European capital markets, FESE proposes:
- The European Commission to take appropriate steps to defer the introduction of increased margins within the EU pending international harmonisation, in order to prevent any further erosion in exchange-traded derivatives business in the EU as a consequence of regulatory arbitrage.
- G20 countries to schedule a progress report at G20 level to ensure that appropriate focus on coordinated derivatives reform.
