EFAMA agrees with the approach and, more generally, with the findings highlighted by ESMA in its report on the implementation of the conditions under which the commercial terms are to be fair, reasonable, non-discriminatory and transparent (FRANDT) when providing CCP clearing services to clients.
Requiring compliance with core principles relating to fairness and non-discrimination helps to ensure decisions regarding whether to provide clearing to a client, and the associated commercial terms, are based on legitimate commercial considerations. In that perspective, the recognition by the co-legislators of the need to treat small financial counterparties differently should be reflected in the services and prices offered by Clearing Members.
Consequently, EFAMA encourages ESMA to:
further define these requirements in a more granular and well-balanced way to ensure there is robust and harmonised application of these rules across clearing members, while minimising the possibilities of “arbitrage” at the detriment of smaller clearing clients.
not consider RCB criteria for granted when assessing the implementation of FRANDT.
extend FRANDT principles to all services required in EMIR Refit, and not only for centrally cleared transactions; and
more importantly, qualify the clearing service as an investment service under the Annex I of MiFID II. EFAMA recommends ESMA to ensure coordination between regulatory measures or to suggest changes to the legislation to ensure insertion of clearing activities in the list of financial services.
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© EFAMA - European Fund and Asset Management Association
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