On 25 June 2020, the European Systemic Risk Board (ESRB) published an opinion on the earlier European Securities and Markets Authority’s (ESMA) report on central clearing solutions for pension scheme arrangements (PSAs).
The ESRB opinion concludes that the best way to remove obstacles for PSAs is to promote indirect clearing. The issues faced by PSAs, as detailed in the ESMA report, are in large part not specific to PSAs, being instead common to all less sophisticated or simply less active entities engaged in clearing, such as investment funds or insurance companies which do not, however, enjoy similarly preferential treatment under the European Market Infrastructure Regulation. These entities overcome these problems by relying on the services provided by the clearing members, among other things. The ESRB believes that these services could be adapted to cater for the specificities of PSA needs. For this to happen, the regulatory requirement to centrally clear must finally come into force.