Derivs - Regulation

The European Commission is gauging opinions from companies, individuals and associations on a pushing ahead with an effort bolster the international jurisdiction of courts.

A vote in the European parliament today on whether to reject technical standards covering non-financial companies in the European Market Infrastructure Regulation has been cancelled. The move came after the European Commission pledged today to phase-in obligations for non-financial firms to clear over-the-counter derivatives.

A proposal from the European Securities and Markets Authority for interoperable central counterparties to assess the need to harmonise their risk management frameworks has been tagged as unworkable by market participants. The European Multilateral Clearing Facility, SIX x-clear and LCH.Clearnet all think the proposal is not practicable.

Misconduct in interest rate submissions at the Royal Bank of Scotland continued into 2010, despite the firm’s management being made aware of potential misconduct related to Libor submissions, according to documents released by regulators. The firm was today fined GBP87.5 million (USD137 million) by the U.K. Financial Services Authority, USD325 million by the U.S. Commodity and Futures Trading Commission, and USD150 million by the U.S. Department of Justice for misconduct relating to Libor.

UBS employees earning over CHF250,000 will have part of their bonuses deferred.

The Hong Kong Exchange has presented its plans for after hours futures trading to the Legislative Council’s Panel on Financial Affairs.

LCH.Clearnet’s ForexClear platform has cleared USD500 billion of fx non-deliverable forwards since its launch last March.

Initial margin requirements in proposals from the Securities and Exchange Commission would curtail the use of uncleared swaps for hedging and challenge the resilience of the financial system.

Some dealers have started booking in London some derivatives that would normally have been booked in Hong Kong to avoid facing compliance problems under the Foreign Account Tax Compliance Act.

Proposals from the European Parliament’s Economic and Monetary Affairs Committee to establish key information documents alongside investment products would hamper innovation and could freeze markets, according to the European Structured Investment Products Association, in a response.

Proposed amendments to the Monetary Authority of Singapore Act could give the regulator greater powers to deal with failed financial institutions.

The Securities Association of China, a Beijing-based capital markets self-regulatory organization, is creating a standard master agreement in preparation for the launch of China’s first onshore OTC equity derivative market (DI, 9/3).