FESE welcomes the regulatory reform of OTC derivatives markets initiated by U.S. Treasury Secretary Geithner, SEC Chairman Schapiro and CFTC Acting Chairman Dunn. In particular, FESE commends the proposed action to promote efficiency and transparency and to mitigate risk in the OTC derivatives market.
FESE in particular congratulates the US regulators for taking a nuanced view of the clearing landscape for OTC derivatives. The proposal contains a clear framework for enforcement with clearly defined terms and recognition of the need to work with overseas regulators to avoid regulatory arbitrage opportunities.
FESE Secretary General commented: “We believe this proposal, when implemented, will significantly contribute towards an increase in investor confidence as well as ensuring the integrity of the marketplace and strengthening risk management capabilities”.
Finally, FESE strongly believes that the current constructive dialogue between the US authorities and the European Commission to coordinate the regulation and supervision of these markets will prevent transatlantic regulatory gaps and give these two jurisdictions a leading role in shaping the global policy response in the derivatives area. In this regard, FESE will continue its cooperative dialogue with regulators, supervisors and market participants on both sides of the Atlantic.