Brussels, 15/06/2010 (Agence Europe) - The European Parliament has adopted, without amendment, the draft own initiative report by Werner Langen (EPP, Germany) on future policy initiatives on the derivatives market (see EUROPE 10154). It calls for European legislation which will bring transparency and reduce risks in a market worth €600,000 billion. “What we need is more transparency in the derivatives markets. Our resolution is a clear signal to the Council and the Commission to get EU legislation going as soon as possible. Derivatives play a role in minimising risk, but they can also be used for speculative purposes,” Langen says in a press release. Ahead of the plenary session, no amendments were lodged. Only the European Conservatives and Reformers called for a separate vote for a dozen amendments.
The European Parliament has now come into line with the European legislative initiative, currently put to public consultation, to run until 10 July (see EUROPE 10159) and which the European Commission is likely to present at the start of September. It backs: - clearing of standardised derivatives in central counterparties (CCPs); - the new European Securities and Marketing Authority (ESMA) playing a major role on approval and supervision of CCPs and trade repositories, which are responsible for collecting and maintaining the records of transactions in derivatives; - derivatives which continue to be traded bilaterally being subject to stricter capital requirements; - credit default swaps being banned.
The rapporteur acknowledged that there was “some controversy” in the EP over derivatives issued by third countries. “A majority of MEPs call for all derivatives with either an EU currency denomination, or those that are related to an EU company, or those any financial institution in the EU deals with, to be cleared and settled in the EU,” he said. (M.B./transl.rt)