Controversies Over Clearing: Regulation of Derivatives

2020 ◽  
pp. 129-149
Author(s):  
Scott James ◽  
Lucia Quaglia
Keyword(s):  
Euro Area ◽  
Financial Stability ◽  
International Level ◽  
Over The Counter ◽  
Legal Challenges ◽  
Central Counterparties ◽  
Regulatory Capacity ◽  
The Uk ◽  
European Markets ◽  
Minimal Resistance

UK regulators supported more stringent rules regarding the clearing of over-the-counter derivatives through Central Counterparties (CCPs) on financial stability grounds. Minimal resistance to this came either from elected officials, who paid little attention to the issue, or from the derivatives industry, as many viewed reform as desirable. UK regulators were therefore able to pursue the trading-up of OTCD rules and greater harmonization to manage the cross-border externalities generated by derivatives clearing. At the international level, UK regulators acted as pace-setters to secure more prescriptive standards, leveraging their significant market power and regulatory capacity, based on London’s prominent position. But at the EU level, UK negotiators pursued a strategy of foot-dragging in opposition to European Markets Infrastructure Regulation (EMIR) provisions on the scope, access, and location of CCPs. The UK also used legal challenges to block attempts to relocate the clearing of euro-denominated derivatives to the euro area.

scholarly journals International obligations and devolved powers – ploughing through competences and GM crops

2018 ◽  
Vol 20 (1) ◽  
pp. 16-31 ◽  
Author(s):  
Annegret Engel ◽  
Ludivine Petetin
Keyword(s):  
International Level ◽  
The European Union ◽  
Crop Cultivation ◽  
The United Kingdom ◽  
Legal Challenges ◽  
International Obligations ◽  
The Uk ◽  
The Impact ◽  
The Eu

This article analyses the impact of Brexit on devolved competences in environmental protection. It maps the post-Brexit division of the United Kingdom (UK)’s internal (devolved) and external (international) competences and how this may shift when competences are returned from the European Union (EU). Crucially, the article suggests that certain of these EU powers do not simply derive from the EU but are, in fact, already held by the devolved regions in accordance with the principle of subsidiarity. Consequently, devolved competences are under threat of being pre-empted as the UK seeks to harmonise otherwise fragmented policies and legislation to comply with obligations at international level. This conundrum is illustrated here using a case study on genetically modified crop cultivation, which identifies the conflicts in the UK’s proclaimed strategy post-Brexit between international obligations and devolved competences and the legal challenges this entails.

Resisting the Push for Tougher Regulation: Hedge Funds

2020 ◽  
pp. 111-128
Author(s):  
Scott James ◽  
Lucia Quaglia
Keyword(s):  
Hedge Funds ◽  
Financial Services ◽  
International Standards ◽  
International Level ◽  
Light Touch ◽  
Financial Industry ◽  
Domestic Constraints ◽  
The Us ◽  
Regulatory Capacity ◽  
The Uk

In the wake of the crisis, regulators at the Financial Services Authority (FSA) sought to develop a tougher approach to overseeing hedge funds. But this push for trading-up regulation was opposed by elected officials, together with the financial industry, on the grounds that this would damage the competitiveness of the sector. The FSA’s capacity to resist this pushback was also severely constrained by growing speculation over whether it would be abolished, limiting its regulatory capacity and diminishing its institutional resources. At the international level, the UK allied with the US to act as foot-draggers to ensure that new international standards were broadly compatible with their relatively light-touch regime. However, the UK’s ability to resist the trading-up of EU rules was more limited because it lacked political allies and domestic constraints to exploit as bargaining leverage.

OTC Derivatives Clearing, Brexit, and the CMU

2018 ◽  
Author(s):  
Guido Ferrarini ◽  
Davide Trasciatti
Keyword(s):  
Case Scenario ◽  
Worst Case ◽  
Over The Counter ◽  
Otc Derivatives ◽  
Central Counterparties ◽  
Capital Markets Union ◽  
Article 50 ◽  
The Uk ◽  
Market Infrastructure ◽  
The Eu

This chapter contributes to the debate on the future of European over-the-counter (OTC) clearing and relevant infrastructures in light of the Capital Markets Union and its re-configuration after Brexit. It begins by introducing some basic notions about clearing dynamics. It then analyses the available divorce options between the EU and the UK once Article 50 has been triggered, and their impact on clearing particularly in light of the European Market Infrastructure Regulation's equivalence regime. Next, it examines the worst-case scenario that would materialize if UK central counterparties (CCPs) were excluded from the single market, and considers possible network strategies that CCPs could adopt to remedy the consequences of Brexit.

scholarly journals Central Counterparties are Too Big for the European Securities and Markets Authority (Alone): Constructive Critique of the 2019 CCP Supervision Regulation

2021 ◽  
Author(s):  
Romualdo Canini
Keyword(s):  
Financial Stability ◽  
National Level ◽  
The European Union ◽  
Over The Counter ◽  
Prudential Supervision ◽  
Fiscal Responsibility ◽  
Monetary Constitution ◽  
Central Counterparties ◽  
Market Infrastructure ◽  
Single Approach

AbstractOnce seen as the solution to the systemic risk of over-the-counter derivatives, central counterparties (CCPs) have become a source of concern for the financial stability of the European Union (EU). Distress of a single CCP might be transferred to clearing members and others CCPs, thereby endangering EU monetary and fiscal stability. However, the European Market Infrastructure Regulation (EMIR) has left fiscal responsibility as well as day-to-day supervision of EU-based CCPs (EU-CCPs) at the national level, albeit cross-border colleges of authorities can overturn key decisions of national supervisors. The Commission concluded that these supervisory arrangements needed to be reformed because they hamper the development of a single coherent EU approach to CCP supervision. Although the Commission had proposed to centralise EU-CCP supervision in the European Securities and Markets Authority (ESMA), the final 2019 CCP Supervision Regulation seeks to improve EMIR’s ineffective collegial framework by establishing an internal CCP Supervisory Committee within ESMA. Nevertheless, the continuing lack of loss mutualisation would keep on hindering the development of a single approach to EU-CCP supervision. Moreover, the new regulation adds another layer of complexity to the EMIR framework and clashes with the European monetary constitution. If an agreement on loss mutualisation was reached, EU-CCP supervision should be centralised in two EU bodies along objective lines: while the European Central Bank should be tasked with EU-CCP prudential supervision, ESMA should be responsible for EU-CCP conduct of business supervision. This framework would improve EU-CCP supervision and fit in with the current EU governance at once.

scholarly journals Food support provision in COVID-19 times: a mixed method study based in Greater Manchester

2021 ◽  
Author(s):  
Filippo Oncini
Keyword(s):  
Financial Stability ◽  
Food Aid ◽  
Structured Interviews ◽  
Support Providers ◽  
Support Provision ◽  
Emergency Response Plan ◽  
Support Organizations ◽  
User Demand ◽  
Response Plan ◽  
The Uk

AbstractCOVID-19 has brought to light the severity of economic inequalities by testing the capacity of the poorest families to make ends meet. Food insecurity has in fact soared all over the UK, with many people forced to rely on food support providers to not go hungry. This paper uses a unique dataset on 55 food support organizations active in Greater Manchester during the first COVID-19 wave, and 41 semi-structured interviews with food aid spokespersons and stakeholders, to shed light on what they overcame, the complications and drawbacks of the food emergency response plan put in place. The results indicate that food aid organizations that remained open were surprisingly effective despite the growth in user demand and the decrease in volunteers. However, the necessity to maintain a timely supply food at all costs came with important drawbacks. The lockdown measures that followed COVID-19 not only affected the financial stability and management of the organizations, and the availability of food, but undermined the ways in which food support providers used to operate. Owing to physical distancing measures and to the increasing numbers of users, more or less intangible forms of support such as financial advice, empathic listening and human warmth were partially lost, probably when they were needed more than ever.

Estimating a bilateral J‐curve between the UK and the Euro area: An asymmetric analysis

2021 ◽  
Vol 89 (2) ◽  
pp. 223-237
Author(s):  
Mohsen Bahmani‐Oskooee ◽  
Huseyin Karamelikli
Keyword(s):  
Euro Area ◽  
J Curve ◽  
The Uk

The UK and EMU: Choosing the Regime

2002 ◽  
Vol 180 ◽  
pp. 54-71 ◽  
Author(s):  
Ray Barrell
Keyword(s):  
Euro Area ◽  
Policy Framework ◽  
Medium Term ◽  
Fiscal Regimes ◽  
The Stability ◽  
The Uk

The UK has to make a decision on membership of EMU in the next two years. The monetary and fiscal regimes in the Euro Area and in the UK do not differ greatly. However, we argue that membership of EMU will increase the stability of the economy and the credibility of the policy framework, and hence will enhance the prospects for growth and higher incomes and employment. There appear to be no major problems associated with joining EMU at around 1.50 euros to the pound, although there are risks to the UK if the euro appreciates against the dollar after we have entered. However, the costs associated with this risk have to be offset against the probability of the significant output gains that could come from EMU membership in the medium term.

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