As the UK dominates the European market for clearing of deritaves, and processes the bulk of the 735 EUR trillion market in swaps and futures, ESMA has announced an extension of 18 months following the end of the Brexit transition period at the end of December 2020.

In particular, ICE Clear Europe Limited, LCH Limited, and LME Clear Limited, will be recognised as third country counterparties and will be eligible to provide their services in the EU for one more year and a half, until June 2022. Additionally, for the same extended period, the European Commission announced its decision to grant the status of equivalent to the UK’s current regulatory and supervisory framework applicable on counterparties.

These developments give time for ESMA to conduct “a comprehensive review of the systemic importance of UK counterparites and their clearing services or activities to the union and take any appropriate measures to address financial stability risks”.

The Regulatory department at SALVUS is staying ahead of such news and developments, timely informing and updating our clients and partners. Should you have any question on the matter or other needs in areas of post-Brexit licensing and compliance, please contact us.

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