ICE warns clients global regulation could harm business

ICE outlines business concerns related to regulation in its latest annual report.

The Intercontinental Exchange (ICE) has said current regulations and the possibility of new regulations could ‘adversely’ affect its business and ability to compete in certain markets.

The exchange operator’s 2016 annual report explained current regulations like EMIR, MiFID II and Dodd-Frank are areas of concern for the exchange.

Specifically, ICE noted position limit rules in the US and Europe, non-discriminatory access provisions of MiFID II and interoperability and margin rules in EMIR.

The report warned that clients and shareholders should be aware the possibility for new laws and regulations could also affect its ability to do business in certain regions.

ICE said this could “adversely affect our ability to compete effectively with other institutions that are not affected in the same way or impact our clients’ overall trading volume through our exchanges and demand for our market data and other services.”

It noted the unknowns presented by the recent US election could also see current regulation altered to negatively affect the industry or the exchange itself.

The report added regulation could make it ‘unprofitable’ or ‘uneconomical’ to conduct business in certain jurisdictions, leading to severe business changes. 

It said this risk could cause significant costs with changing ICE’s business practices through restructuring and relocating employees.

“Our businesses and those of many of our clients have been and continue to be subject to increased legislation and regulatory scrutiny, and we face the risk of changes to this regulatory environment and business in the future,” ICE concluded.