In response to a legislative proposal on further amendments to the European Market Infrastructure Regulation (EMIR) regarding clearing in Europe, FIA president and CEO Walt Lukken released the following statement:
“Given the importance of central clearing to our economy, FIA supports the European Commission’s desire to enhance regulatory oversight to maintain stable markets. We appreciate that this proposal builds on the successful equivalence framework in place today, while considering enhanced standards for systemically important clearinghouses.
Although the proposal includes significant limits under which a clearinghouse would be required to relocate, we remain concerned about potential market disruption should any forced relocation occur.
As FIA noted in comments to the European Commission last week, forced relocation would fragment markets, diminish the risk-reducing benefits of portfolio margining, harm liquidity, and ultimately increase costs for end users.
We urge the Commission to consider public input and maintain a dialogue with market participants on how best to protect financial stability while maintaining integrated, liquid markets.”
