The limits to US/EU harmonisation

Author: Lizzie Meager, Edward Price | Published: 12 Apr 2016

The European and US agreement on central clearing counterparties (CCPs) has been an encouraging step forward, but market participants believe the limits to transatlantic coherence are becoming clear.

In February, the Commodity Futures Trading Commission (CFTC) approved a substituted compliance framework for dually ­registered central counterparties (CCPs) located in the EU. The move was welcomed by some US counsel as a sign of further harmonisation. Yet while important market infrastructure issues have been addressed cooperatively, fundamental policy differences remain.

Different economic policy incentives appear to be pulling EU and US policymakers in different directions. "It’s good that we’ve had a win on derivatives, but it doesn’t change the more fundamental issue: there is an imperative in Europe to establish a more vibrant securitisation market," said Lewis Cohen, partner at Hogan Lovells.


Counsel have welcomed CFTC’s approval of a substituted compliance framework for dually ­registered...