ISDA Recommendations to Simplify EU Regulation
Summary
The International Swaps and Derivatives Association (ISDA) has submitted a paper to the European Commission with eight recommendations to simplify EU derivatives regulation. The proposals aim to reduce operational complexity and compliance costs while maintaining high regulatory standards and enhancing the EU's attractiveness for derivatives activity.
What changed
ISDA has submitted a paper to the European Commission outlining eight recommendations aimed at simplifying EU regulatory provisions for derivatives. The proposals focus on Level 1 provisions to reduce operational complexity and compliance costs, while preserving high regulatory standards. Additionally, two horizontal recommendations are made to improve the legislative process, specifically concerning the sequencing of Level 1 and Level 2 measures and the potential for temporary suspension of requirements.
These recommendations are intended to enhance the EU's attractiveness for derivatives activity, support investment and competitiveness, and contribute to well-functioning capital markets. While this is a submission of recommendations and not a rule change, regulated entities, particularly those involved in derivatives trading and reporting within the EU, should be aware of these proposals as they could influence future regulatory adjustments. No immediate compliance actions are required, but monitoring the European Commission's response and any subsequent regulatory changes is advisable.
Source document (simplified)
- Public Policy
- Europe
- ISDA Submits Recommendations to Simplify EU Regulation and Enhance Legislative Process
ISDA Submits Recommendations to Simplify EU Regulation and Enhance Legislative Process
On March 9, ISDA submitted a paper to the European Commission setting out focused proposals to improve the functioning of the EU regulatory framework for derivatives. The paper comprises eight targeted recommendations to simplify selected Level 1 provisions in a way that preserves high regulatory standards while delivering meaningful reductions in operational complexity and compliance costs. These adjustments would enhance the EU’s attractiveness as a location for derivatives activity and reinforce its capacity to support investment and competitiveness.
The paper also outlines two horizontal recommendations intended to improve the legislative process. These relate, first, to the sequencing of Level 1 and Level 2 measures and, second, to the introduction of a time-limited mechanism allowing for the temporary suspension of specific requirements where warranted by market conditions or implementation challenges.
Overall, ISDA believes these proposals would contribute constructively to the EU’s broader objectives of competitiveness, well‑functioning capital markets and proportionate regulation.
Tags:
EMIR, European Commission (EC), MIFIR, Reporting, Sustainable Finance
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