LONDON Feb 14 The European Union's markets
watchdog has asked the bloc for an urgent definition of
derivatives, two days after mandatory reporting of the financial
The European Securities and Markets Authority (ESMA) said
there is no common pan-EU definition for some foreign exchange
and physically settled commodity derivatives, making it
difficult to apply the bloc's new reporting rules.
In a letter to the European Commission and made available to
the press on Friday, ESMA said a measure needed to be adopted
urgently to clarify the definitions.
Until that is done, national regulators will not have to
require users of the foreign exchange forward contracts and
physically settled commodity forwards to report those trades.
The aim of reporting is to give regulators a snapshot of
where risks and exposures lie if one side of a trade goes bust.
ESMA's intervention comes after an already shaky start as
some market participants were not ready to
(Reporting by Huw Jones; editing by Tom Pfeiffer)