MFA submitted a comment letter to the European Securities and Markets Authority (“ESMA”) in response to its Consultation Paper on “Draft Technical Standards for the Regulation of OTC Derivatives, CCPs and Trade Repositories.” This letter was submitted in connection with an accompanying letter on straight-through processing. In our letter, among other things, MFA requested that ESMA:
(i) adopt various anti-circumvension mechanisms to enhance protections related to client representation on central counterparty (“CCP”) governing bodies;
(ii) ensure greater CCP transparency by requiring public disclosure of its governing bodies’ meeting minutes and the identities of CCP governing body members;
(iii) provide greater clarity about the legal, operational and collateral posting aspects of the “omnibus” and “individual client” segregation models; and
(iv) allow greater flexibility with respect to portfolio margining, portfolio compression and timing of confirmation of trades.