Marco Strimer, CEO of SIX x-clear, talking to Global Custodian at SIBOS 2009, has stated that he is not very keen to have a [CCP] convention. Strimer was referring to the call from EuroCCP for the adoption of a single standard Convention on Interoperability that all central counterparties (CCPs) would sign.
The Convention, designed as a framework agreement, would require CCPs to agree on risk management arrangements that are transparent to market users, platforms and regulators. “Although some progress has been made on interoperability, there is insufficient transparency in how new risks caused by interoperability are managed. It is not sufficient that costs come down through competition to realise the benefits envisioned by MiFID and the Code of Conduct,” said Diana Chan, Chief Executive Officer of EuroCCP.
Strimer pointed out that the there would be a problem regarding how regulators in varying regulators would interpret the Convention, possibly damaging CCPs ability to compete in different jurisdictions. If anyone can join this convention, does this mean that anyone can clear in all markets? asked Strimer. Strimer also stated the need to protect SIX x-clears considerable investments made to keep competitive in the industry, which may be partially by-passed by the framework.