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U.S. swaps regulator gives EU firms more time to meet rules
March 21, 2014 / 10:52 PM / in 4 years

U.S. swaps regulator gives EU firms more time to meet rules

WASHINGTON (Reuters) - The U.S. derivatives regulator on Friday gave European trading platforms more time to register and meet strict new rules to make the market more transparent, in anticipation of comparable rules abroad.

The delay was issued by the agency in a so-called no-action letter after an agreement the Commodity Futures Trading Commission struck with the European Union in February, which will in practice affect firms in London only.

The CFTC at the time said it expected the UK’s Financial Conduct Authority to have rules comparable to its own in place by March 24, and that foreign companies would be granted relief from its rules, if they so requested.

The platforms to trade swaps now have until May 14 to register, or so much earlier as the agency finds they have signed up with a European regulator with comparable rules.

The CFTC also said it would adjust the conditions companies would have to meet, and that it would elaborate on that in another statement expected next week.

The CFTC last year publicly argued with the European Union as it sought broad sway over foreign companies doing business with U.S. clients or trading out of U.S. offices.

It has also been sued by U.S. banks over so-called cross-border rules. The banks argue that the United States has no jurisdiction over what they do abroad.

The February decision had been anticipated by London firms, which do the bulk of the business with U.S. banks. Only swaps broker ICAP had sent in registration paperwork for its London unit to avoid any risk of noncompliance.

The $630 trillion global swaps market, which was at the center of the 2007-09 financial crisis, is dominated by large investment banks such as Bank of America, JP Morgan Chase & Co and Citigroup.

Editing by Grant McCool

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