The Financial Services Authority (FSA) has granted recognition to ICE Clear Europe Ltd (ICE Clear) as a Recognised Clearing House for the purposes of the Financial Services and Markets Act 2000 (FSMA).
If a clearing house or investment exchange applies to the FSA for recognition under the FSMA, the OFT is required to report on whether one or more of the regulatory provisions of the clearing house or exchange have a significantly adverse effect on competition, and a report is sent to the FSA, the Competition Commission and the Treasury.
In this case the OFT concluded that the recognition of ICE Clear would not lead to a significantly adverse effect on competition and a further investigation by the Competition Commission was not required. A non-confidential version of the OFT’s report will be published on its website when the OFT has completed consultations with the parties who provided evidence.
The OFT recognises that some competition concerns have been expressed about clearing and settlement in the derivatives market. The European Commission is currently considering these and similar issues. The OFT would welcome views from interested parties that would inform the OFT’s prioritisation decision as to whether to undertake any work looking at clearing and settlement in the derivatives market. Any such submissions should be sent to the OFT by 30th June 2008 and should include a view on why the OFT is best placed to act.