Eurex Clearing wins US approval
02 February 2016 Washington DC
Image: Shutterstock
Europe’s largest clearinghouse and part of the Deutsche Börse group, Eurex Clearing, has received regulatory approval from the US Commodity Futures Trading Commission (CFTC).
The order of registration was issued on 1 February, meaning Eurex Clearing is now a registered derivatives clearing organisation (DCO) under the commodities exchange act.
Eurex Clearing will start offering proprietary over-the-counter (OTC) clearing services to US clearing members and their US-based affiliates.
Registration will become effective once Eurex Clearing meets the CFTC’s straight-through processing (STP) requirements.
According to CFTC, Eurex Clearing requested this conditional registration, preferring to comply with STP requirements in the future, when it is mandated to comply with European requirements, which have not been specified yet, due to a delay in the EU Markets in Financial Instruments Directive (MiFID) II.
The clearinghouse can continue to clear proprietary positions in interest rate swaps for US clearing members, and once it complies with the STP requirements, it will be able to start clearing futures commission merchant customer positions, as well.
The EurexOTC Clear product for interest rate swaps will be in use based on a ‘no-action relief’ issue, meaning that, for a period of time and for accounts held in the central bank of Germany, Eurex Clearing will not have to comply with every requirement laid out in the CFTC regulations.
Thomas Book, CEO of Eurex Clearing, said: “The DCO approval is an important milestone in our strategy to further expand our global distribution. It also underlines Eurex Clearing’s commitment to our customers in the US market.”
He added: “We are pleased that the recognition by the CFTC also reconfirms Eurex Clearing’s industry leading position complying with the highest international standards and state-of-the-art risk management.”
Eurex Clearing is the 16th DCO to be registered with the CFTC, and only the 6th based outside of the US.
In January, the CFTC signed a memorandum of understanding with the German regulators of Eurex Clearing, Bundesanstalt für Finanzdienstleistungsaufsicht and Deutsche Bundesbank, facilitating information sharing and cooperative oversight.
The order of registration was issued on 1 February, meaning Eurex Clearing is now a registered derivatives clearing organisation (DCO) under the commodities exchange act.
Eurex Clearing will start offering proprietary over-the-counter (OTC) clearing services to US clearing members and their US-based affiliates.
Registration will become effective once Eurex Clearing meets the CFTC’s straight-through processing (STP) requirements.
According to CFTC, Eurex Clearing requested this conditional registration, preferring to comply with STP requirements in the future, when it is mandated to comply with European requirements, which have not been specified yet, due to a delay in the EU Markets in Financial Instruments Directive (MiFID) II.
The clearinghouse can continue to clear proprietary positions in interest rate swaps for US clearing members, and once it complies with the STP requirements, it will be able to start clearing futures commission merchant customer positions, as well.
The EurexOTC Clear product for interest rate swaps will be in use based on a ‘no-action relief’ issue, meaning that, for a period of time and for accounts held in the central bank of Germany, Eurex Clearing will not have to comply with every requirement laid out in the CFTC regulations.
Thomas Book, CEO of Eurex Clearing, said: “The DCO approval is an important milestone in our strategy to further expand our global distribution. It also underlines Eurex Clearing’s commitment to our customers in the US market.”
He added: “We are pleased that the recognition by the CFTC also reconfirms Eurex Clearing’s industry leading position complying with the highest international standards and state-of-the-art risk management.”
Eurex Clearing is the 16th DCO to be registered with the CFTC, and only the 6th based outside of the US.
In January, the CFTC signed a memorandum of understanding with the German regulators of Eurex Clearing, Bundesanstalt für Finanzdienstleistungsaufsicht and Deutsche Bundesbank, facilitating information sharing and cooperative oversight.
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