EMIR 2.2 - Clearing - Extension of equivalence of UK CCPs and brief consultation
On 8 February 2022, the European Commission (EC) officially announced the extension of its temporary recognition.
It now runs until June 30, 2025, three years longer than the previous date. The EC expressed its intention in a press release of 10 November 2021 as well as its willingness to continue its reflections on the future of central clearing (via a CCP1) (see Flash News).
On the latter point, the EC had two objectives: to have an attractive European offer and to have an ad hoc supervisory framework. It was with this in mind that the EC launched a rapid consultation.
Although EMIR 2.2 covers all types of cleared products, it is clear the consultation focuses primarily on OTC derivatives. Different angles are explored along the questions; for example: access to CCPs for entities subject to the clearing obligation, the end of the exemption for PSA2 (see Flash News), the incentive for public entities to use a CCP even though they are permanently exempted, the extension of the clearing obligation to new products, prudential requirements, the reduction of dependence on third country CCPs deemed systemic, etc.
The EC’s objective is to make proposals in the second half of 2022.
1CCP : Central Counterparty
2PSA : Pension Scheme Arrangements