Harmonisation is proving elusive as regions go it alone on G20 reforms
By Anthony Perrotta, global head of
Research & Consulting at Tabb Group
"Without continual growth and progress,
such words as improvement, achievement, and success have no
meaning" – Benjamin Franklin
The road toward implementing a new global
regulatory construct for the over-the-counter (OTC) derivatives
market has been long and winding, fraught with twists, turns,
potholes, traffic jams, and a lot of rubbernecking. Progress
has been slow, but steady. The European Commission (EC)
recently announced a further step to reduce confusion and
mitigate regulatory arbitrage by advancing another component of
When global legislators initially set out
to ensure the viability and stability of global financial
markets, they did so directing much of their focus toward the
OTC derivatives markets. In the US, lawmakers passed the
Dodd-Frank Act, which, through Title VII, has the intent of
reducing systemic risk and increasing market transparency. The
European Commission passed the European Markets Infrastructure
Regulation (Emir), with the goal of increasing market
stability, transparency and efficiency. These initiatives aim
to create a safer and sounder regulatory framework for their
respective markets. The challenge left unresolved is aligning
global interests and creating regulatory harmony.
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