Commissioner Mairead McGuinness
Directorate-General for Financial Stability, Financial Services and Capital Markets
European Commission
1049 Bruxelles / Brussels
Belgium

16 September 2021

Dear Commissioner McGuinness,

Equivalence and Recognition in relation to UK CCPs

The Joint Associations1 are appreciative of the work carried out by the European Commission so far to safeguard financial stability and to ensure continuity of access for EU market participants to UK central counterparties (CCPs). In particular, we welcome the Commission’s adoption on 21 September 2020 of a time-limited equivalence decision determining that the regulatory and supervisory framework applicable to CCPs established in the UK is equivalent in accordance with Regulation (EU) No 648/2012 (EMIR)2.

We also appreciate the Commission’s work in finalising the changes to the recognition regime for non-EU CCPs under EMIR 2.23, which significantly increased ESMA’s role in overseeing Tier 2 non-EU CCPs, enabling ESMA and other EU regulators (including central banks of issue (CBIs) and national competent authorities (NCAs)) to undertake independent supervisory activities and analysis.
As the time-limited equivalence decision for UK CCPs currently expires on 30 June 2022, we respectfully request the Commission to provide clarity as soon as possible and well in advance of March 2022 in order to prevent negative financial, commercial, operational and level playing field effects on EU counterparties and clearing members and to enable continued access to global pools of liquidity after 30 June 2022.

The Joint Associations (representing the broadest group of market participants) respectfully ask the Commission to extend the equivalence decision for UK CCPs for the reasons set out below.

1 The Joint Associations are AFME, AIMA, EAPB, EBF, EFAMA, FIA, ICI, ISDA, SIFMA AMG. Information on each association is set out in Annex I to this letter.