The OTC Derivatives Regulators Group (ODRG) has published an update to G20 leaders on how it has addressed or intends to address OTC derivatives cross-border implementation issues.

The update mentions that a focus of the ODRG has been the issue of deference in the context of central counterparties (CCPs), in line with the G20 Leaders’ St Petersburg and Brisbane declarations. Annex A of the update contains a paper on deference in the context of CCPs.

The update also covers:

  • monitoring of substituted compliance and equivalence assessments. The ODRG agreed that monitoring of substituted compliance and equivalence assessments is necessary to ensure these assessments and determinations remain up-to-date, and the sharing of information on legal or regulatory changes is essential to such monitoring;
  • cooperation on clearing obligation mandates. ODRG members previously agreed to a framework for consulting one another on mandatory clearing determinations, with the aim of harmonizing mandatory clearing determinations across jurisdictions to the extent practicable. ODRG members are considering ways to enhance the framework for cooperation;
  • other work previously identified. As part of its work on addressing regulatory conflicts, inconsistencies, gaps and duplicative requirements in the treatment of branches in cross-border situations, the ODRG has discussed the application of rules to branches of financial institutions that operate across multiple jurisdictions; and
  • continued progress in addressing cross-border issues among ODRG jurisdictions. Following the four equivalence decisions made by the European Commission in October 2014 with respect to the regulatory regimes for CCPs for Australia, Hong Kong, Japan and Singapore, the European Securities and Markets Authority (ESMA) has signed related Memoranda of Understanding (MOUs) with the relevant authorities from these countries. The MOUs were instrumental in enabling ESMA to recognise eleven CCPs established in these four countries.

View Report of the OTC Derivatives Regulators Group to G20 Leaders on cross-border implementation issues, 9 November 2015