The European Commission (EC) has confirmed that another trialogue meeting has been scheduled to iron out remaining differences over the European market infrastructure regulation (EMIR), raising hopes that a deal could be thrashed out before the end of the year.
The meeting between the European Parliament, the Council of the European Union and the EC will take place next Monday and signals intent from policymakers to adopt the key piece of derivatives legislation as soon as possible.
A source close to the talks said that much of the remaining work is at the technical level, which may include deciding which types of OTC derivatives are suitable for trading on exchange and eligible for central clearing. Deciding which contracts can be cleared currently falls under the remit of the EC and regional securities watchdog the European Securities and Markets Authority (ESMA).
In addition, agreements still need to be reached in determining ESMA’s role in supervision and authorisation of central counterparties. Next Monday’s meeting is also expected to finalise a compromise on the treatment of clearing houses established outside of the European Union that provide services to European trading venues.
EMIR will lead to a widespread overhaul for the OTC derivatives market, in line with Group of 20 commitments made in Pittsburgh in 2009. It will require OTC derivatives to be standardised so that they can be traded on exchange and clearing via a central counterparty. EMIR also contains real-time reporting requirements for swaps positions and increases the capital charges needed for bilaterally traded swaps.