Press Release: Making derivatives markets in Europe safer and more transparent

As part of its ongoing work in creating a sounder financial system, the European Commission has tabled a proposal for a regulation aimed at bringing more safety and more transparency to the over-the-counter (OTC) derivatives market. In its draft regulation, the Commission proposes that information on OTC derivative contracts should be reported to trade repositories and be accessible to supervisory authorities. More information will also be made available to all market participants. The Commission also proposes that standard OTC derivative contracts be cleared through central counterparties (CCPs). This will reduce counterparty credit risk, i.e. the risk that one party to the contract defaults. The Commission's proposal, fully in line with the EU's G20 commitments and the approach adopted by the United States, now passes to the European Parliament and the EU Member States for consideration. Once adopted, the regulation would apply from end 2012.

Commission proposal on OTC Derivatives and Market infrastructures – FAQs http://europa.eu/rapid/pressReleasesAction.do?reference=MEMO/10/410&format=HTML&aged=0&language=EN&guiLanguage=en

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