Derivs - Regulation

Derivatives market participants should be given a relief period on variation margin rules after the slated March 1 deadline, the International Swaps and Derivatives Association has said, adding its voice to a rising clamour across the industry.

The European Securities and Markets Authority wants to standardise the way that trade repositories and market participants transfer data on derivatives obligations, having warned that problems could arise under the Markets in Financial Instruments Directive II (MiFID II) regulations.

Pension funds and other buy-side institutions are not prepared to meet new variation margin rules expected to come into force on March 1. And if they cannot trade, the regulation is not worth the paper it is written on, delegates heard at a conference in Luxembourg last week.

The chairman of the European Securities and Market Authority, Steven Maijoor, has complained of a mismatch in the treatment of EU central counterparties by other regulatory authorities versus that of overseas CCPs operating in the EU, at a time when a change of US regulatory direction appears imminent.

London based clearing house LCH made further inroads into the US this week, with the Commodity Futures Trading Commission (CFTC) giving LCH.Clearnet and its clearing members permission to portfolio margin customer positions.

The derivatives market obtained its strongest sign yet that US regulations are soon to move in a more trading friendly direction, with J Christopher Giancarlo not only confirming that he is the acting chairman of the Commodity Futures Trading Commission but also indicating that he will soften rules governing variation margin posting and swap execution facilities.

The US Commodity Futures Trading Commission has given LCH.Clearnet and its clearing members permission to portfolio margin customer positions.

The US Commodity Futures Trading Commission has issued an order of registration for Intercontinental Exchange's ICE Endex exchange, allowing participation by US based investors.

Supervisory and regulatory frameworks in Turkey and New Zealand can be regarded as equivalent to those in the European Union, according to details of a European Commission report released by the European Banking Authority.

Wrangles over the future of euro interest rate swap clearing after Brexit were revived this week, with both European Central Bank president Mario Draghi and outgoing US Commodity Futures Trading Commission chair Timothy Massad suggesting that the EU should maintain oversight of the UK market. Meanwhile, two London-based executives argued that the UK should extend its EU exit process to five years to avoid losing swaps business to the US.

Tradeweb Markets, the New York based electronic fixed income, derivatives and exchange-traded fund marketplace operator, has unveiled a service that allows market participants to meet post-trade transparency requirements mandated by the Markets in Financial Instruments Directive II (MiFID II).

The Association of National Numbering Agencies (ANNA) has issued a consultation paper on the fees that will be payable after the introduction of ISIN numbers for over-the-counter derivatives.