ISDA has published a briefing paper that addresses the argument put forward by EU authorities that clearing at third-country tier-two central counterparties (CCPs) carries a financial stability risk, as well as risks to monetary policy implementation. In the paper, ISDA highlights that the tier-two designation depends largely on the CCP’s size, which does not translate to increased risk if the CCPs are subject to appropriate risk management and supervision. Furthermore, ISDA notes that European Market Infrastructure Regulation 2.2 ensured that tier-two CCPs from the UK are held to the exact same standards as EU CCPs and are directly supervised by the European Securities and Markets Authority, in addition to being supervised by the Bank of England, which affords EU authorities robust safeguards in a recovery scenario. This highlights that clearing at UK CCPs is not riskier than clearing at EU CCPs. Finally, the paper also covers concerns in relation to risks to monetary policy implementation and crisis scenario concerns.
Documents (1) for ISDA Briefing Paper on Clearing at UK Tier-two CCPs
Latest
ISDA In Review – June 2025
A compendium of links to new documents, research papers, press releases and comment letters published by ISDA in June 2025.
ISDA Presents Lock-Up Agreement Proposal
ISDA is pleased to present the proposed Lock-Up Agreements and CDS – Proposed Auction Solution. “Lock-Up Agreements” are market-wide arrangements, broadly standardized and predominantly integrated with court sanctioned restructuring or bankruptcy processes. Numerous end users will sign material Lock-Up Agreements...
Key Trends in OTC Derivatives Market H2 2024
The latest data from the Bank for International Settlements (BIS) over-the-counter (OTC) derivatives statistics shows a modest increase in notional outstanding during the second half of 2024 compared to the same period in 2023. Notional outstanding for interest rate, foreign...
Request to Extend Relief on No-Action Letter 22-18
On July 3, ISDA requested to extend the relief under the Commodity Futures Trading Commission's (CFTC) no-action letter No. 22-18. ISDA requests that the relief is extended until further action by the CFTC resolves the overlapping and contradictory reporting obligations...