On March 9, ISDA submitted a paper to the European Commission setting out focused proposals to improve the functioning of the EU regulatory framework for derivatives. The paper comprises eight targeted recommendations to simplify selected Level 1 provisions in a way that preserves high regulatory standards while delivering meaningful reductions in operational complexity and compliance costs. These adjustments would enhance the EU’s attractiveness as a location for derivatives activity and reinforce its capacity to support investment and competitiveness.

The paper also outlines two horizontal recommendations intended to improve the legislative process. These relate, first, to the sequencing of Level 1 and Level 2 measures and, second, to the introduction of a time-limited mechanism allowing for the temporary suspension of specific requirements where warranted by market conditions or implementation challenges.

Overall, ISDA believes these proposals would contribute constructively to the EU’s broader objectives of competitiveness, well‑functioning capital markets and proportionate regulation.