Capital markets union: Commission extends time-limited equivalence for UK Central Counterparties and launches consultation to expand central clearing activities in the EU

Post-trade infrastructures, such as clearing and settlement, are the backbone of capital markets. So efficient, competitive post-trade markets in general – and clearing in particular – will help create deeper, more liquid markets in the EU. A strong, competitive and integrated financial system will in turn be the basis for a robust and vibrant economy.

In order to address the financial stability concerns surrounding the over-reliance on systemic non-EU Central Counterparties (CCPs) and further develop competitive clearing services in the EU, the European Commission plans to come forward in the second half of 2022 with measures to make EU CCPs more attractive to market participants. First, by building domestic capacity: measures to make the EU more attractive as a competitive and cost-efficient clearing hub, and so incentivise an expansion of central clearing activities in the EU, will be needed. Second, if the EU is to increase its capacity for central clearing, it is essential that any related risks be properly managed and the EU's supervisory framework for CCPs strengthened, including through a stronger role for EU-level supervision.

To be in a better position to propose meaningful changes to the rules applicable to CCPs, their clearing members and the clients of these clearing members, the Commission is also launching today a targeted public consultation and a call for evidence. Both the consultation and call for evidence will look at ways to

• improve the attractiveness of EU CCPs
• reduce the exposure to systemic non-EU CCPs
• enhance the supervision of EU CCPs

In order to achieve this and avoid any short-term financial stability risks, the Commission is also adopting today a new equivalence decision granting access to UK CCPs for another three years, until 30 June 2025.

Documents and links

• Press release
• Commission Implementing Decision determining, for a limited period of time, that the regulatory framework applicable to central counterparties in the United Kingdom of Great Britain and Northern Ireland is equivalent, in accordance with Regulation (EU) No 648/2012
• Commission Implementing Decision in all 24 EU languages
• Targeted consultation on the review of the central clearing framework in the EU
• Call for evidence on the EMIR targeted review and the clearing strategy