EuroCCP And Brexit
Following EuroCCP’s Newsflash dated 28 January 2019 regarding the establishment of new EU-based venues in advance of the UK’s proposed exit from the European Union, EuroCCP is very pleased to inform you that it has obtained the necessary regulatory approvals to provide post-trade services to the EU-based entities of Aquis, Cboe Equities and Turquoise.
EuroCCP and the three trading venues have been working together to put in place measures to allow customers to continue their trading and clearing activity post Brexit. Specifically, it is expected that the EU-based entities of Aquis Exchange, Cboe Equities Europe and Turquoise will offer market participants the ability to trade in EU-listed ISINs following Brexit, while continuing to operate their UK based trading venues for trading of UK and Swiss-listed ISINs. EuroCCP will activate the clearing arrangements in EU-listed ISINs as soon as the new EU-based venues are ready to go live.
In order to ensure a smooth go-live, EuroCCP is seeking to have all new clearing memberships in place prior to the agreed go live date. Clearing Participants are encouraged to have the following completed as soon as possible:-
- Statement of Authority signed
- Netting set up agreed
- Standard Settlement Instructions (SSIs) confirmed
- Successful testing undertaken
Further information on membership applications, client testing and transition arrangements can be found at EuroCCP’s EU based venues & Brexit webpage.
EuroCCP and Deutsche Börse AG
Separately, the anticipated go-live date for EuroCCP’s access to Deutsche Börse is being postponed from 29 March to 27 May 2019 at the earliest. EuroCCP’s resources have been focused on changes related to Brexit as clearing members and trading venues have increasingly started to execute their Brexit contingency arrangements. Additional time is required to finalise the work required prior to go live, including ensuring technical readiness and obtaining required regulatory approvals and EuroCCP is now actively working on this.
There are concerns about the ability to trade dual-listed shares in the most liquid venues.
Brexit has cast uncertainty over the UK’s financial sector.
The UK government will publish its green finance strategy this year.
Participants are concerned about dispersed trading liquidity and regulatory data.
Members based in the European Economic Area will be able to continue using Liquidnet.