Brexit Contingency: Risk Management for OTC Derivatives

Summary

The European Parliament supports a regulation to ensure financial stability during a potential no-deal Brexit by allowing continued risk management for certain derivative contracts.
10 13.02.2019
Other
economy
finance
european union
financial institutions and credit

Key points

  • The regulation serves as part of the contingency package to manage transactions between UK and EU-27 counterparties in a no-deal Brexit scenario.
  • It allows for the continuation of risk-management procedures for specific OTC derivative contracts that are not cleared through a central counterparty.
  • A 12-month exemption is provided for transactions where a UK counterparty is replaced by an EU-27 counterparty.
  • The Parliament expressed concern that the Commission's changes to technical standards should not result in a shortened parliamentary scrutiny period.
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