On November 26, MFA and AIMA submitted a joint response to the European Securities and Markets Authority (ESMA) on ESMA’s consultation paper on “Draft technical advice on commercial terms for providing clearing services under EMIR.” In the letter, the Associations;
- Reiterated their strong support for the change made to Article 4 of EMIR to require clearing services to be provided on a “fair, reasonable, non-discriminatory and transparent” (“FRANDT”) basis;
- Expressed the belief that it is critical that both the onboarding process and the commercial terms offered to the client are fair and transparent, and thus, requested that ESMA prohibit trading personnel from interfering with, or attempting to influence, decisions by clearing personnel with respect to whether to onboard a client or the commercial terms offered to such client; and
- In the context of “unbiased and rational contractual arrangements”, expressed the belief that the delegated act should stipulate that clearing terms offered by clearing members should not contain terms that unnecessarily reduce clients’ rights relating to cleared derivatives compared to uncleared derivatives.
