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European Funds Could Get More Time to Comply With New Clearing Rules for Derivatives 

May 8, 2017

Sophie Baker, P&I Online

European pension funds might be granted a further three-year exemption from compliance with new central clearing rules for derivative trades, in a move that could save them collectively up €1.6 billion ($1.7 billion), the European Commission said.

The commission on Friday proposed changes to the European Market Infrastructure Regulation, which was put in place in 2012 to address concerns over the multitrillion-dollar derivatives market.

The proposals build on a consultation-type exercise on financial regulation, which found EMIR “is doing well overall,” the EC said in a news release. “However, there is room for targeted adjustments to make it more proportionate and efficient. Our aim is to achieve the same prudential results but with less cost to Europe's companies and our economy.”

The EC said it would provide pension funds with three more years to develop the technical solutions they need to take part in central clearing. “While central clearing for pension funds remains our clear goal, this temporary exemption will help them avoid estimated losses of up to €1.6 billion,” the EC said.

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