For close to a year US and EU regulators have been arguing about CCP equivalence rules. As action becomes closer to being an economic imperative, Reuters reports that the dispute may be approaching resolution.
The European Commission expects to reach within six months an agreement with Washington that would allow it to declare U.S. rules for clearing derivatives equivalent to its own. Without an agreement on rule equivalence by June, when a grace period expires, EU players using U.S. clearing houses to clear their trades would have to hold extra capital as an insurance against defaults, a costly requirement. "With the U.S., we are now quite close to an agreement," said Olivier Guersent, director general at the EU Commission's financial services division. "Discussions have been going on for a long time, they started three years ago" said Guersent. "We are now entering a final stage of negotiations and we should certainly see an agreement in the first half of this year."