Recovery and resolution of central counterparties

Key points:

The EESC

• welcomes the proposed "Framework for the recovery and resolution of central counterparties (CCPs)" and underscores that it is paramount to implement the existing decision by the G20 for global governance of CCPs as well as the specific recommendations by the Financial Stability Board  into a harmonised, binding legislation ensuring a sound and secure global level playing field.

• would welcome flexibility to adapt the proposed regulation to the future evolution of international consensus on CCP regulation, i.e. recommendations by the Financial Stability Board (FSB).

• is of the opinion that a Single CCP Supervisory Authority and a Single European Resolution Authority would ensure that the new regulation is implemented most effectively and in a standardised way.

• strongly recommends considering using or extending the ECB's remit to make it both the central European CCP supervisor under the umbrella of the Single Supervisory Mechanism (SSM) as well as the central resolution authority under the umbrella of the ECB/Eurosystem.

• demands that  any bail-out of CCPs with tax-payers' money needs to be excluded, especially for third-country CCPs. The currently included option of extraordinary public support under certain conditions might create a moral hazard situation.
• is of the opinion that close attention should be paid to how non-financial counterparties (NFC) and segregated client assets of indirect clearing participants might be impacted.