INTERNATIONAL: EU and US Financial Markets Regulatory Publish Dialogue Joint Statement

Tuesday September 29 2015

Participants in the Financial Markets Regulatory Dialogue (FMRD) met on 18 September 2015 to exchange information on regulatory developments as part of their ongoing dialogue.

EU participants included representatives of the European Commission, the European Securities and Markets Authority (ESMA), the European Banking Authority (EBA), and the European Insurance and Occupational Pensions Authority (EIOPA).

U.S. participants included staff of the Treasury, including the Federal Insurance Office (FIO), and independent regulatory agencies, including the Board of Governors of the Federal Reserve System (Federal Reserve), the Commodity Futures Trading Commission (CFTC), the Federal Deposit Insurance Corporation (FDIC), and the Securities and Exchange Commission (SEC), as well as the Public Company Accounting Oversight Board (PCAOB).

Participants exchanged views on bank structural measures, recent developments in bank resolution, central counterparty (CCP) resolution, derivatives reforms, securitisation within the context of the Capital Markets Union, money market funds, alternative investment fund managers, benchmarks, information sharing for supervisory and enforcement purposes, cybersecurity, and cooperation on audit oversight.

Capital Markets Union (CMU)

EU participants presented the outlines of the EU’s efforts to facilitate access to market-based finance through the creation of a CMU. In this context, the EU participants presented the EU plans to review the Prospectus Directive and to develop ‘simple, transparent and standardised securitisation’ building on the international work streams led by the Basel Committee on Banking Supervision and the International Organization of Securities Commissions (IOSCO), and on the EBA’s advice to the European Commission.

Derivatives

EU participants and participants from the SEC and CFTC reported that respective bilateral discussions regarding CCPs, notably recognition under EMIR, were continuing in a constructive manner.

Fund issues

EU participants reiterated their concerns about the effect of the Volcker Rule on foreign funds. Participants noted that the FAQs recently published by the Federal Reserve (together with other agencies) addressed many of the questions regarding foreign public funds. The EU participants urged the U.S. participants to find a solution to the remaining important issue regarding foreign private funds in a timely manner.

CCP Resolution

Participants emphasised the importance of clear, credible, and well-designed recovery and resolution frameworks for CCPs in line with internationally-agreed standards. Participants discussed the evolving EU and U.S. approaches and options for cross-border cooperation.

The next FMRD meeting will take place in Washington, D.C., in February 2016.

Click on the link above for further details.