EU extends equivalence for UK clearing houses to 2025

The European Commission granted an extension to equivalence for U.K. central counterparties, or CCPs, until June 30, 2025.

U.K. clearing houses were previously allowed to serve EU customers only until June 30, more than a year after the Brexit transition period ended Dec. 31, 2020. The financial system in the EU has been heavily reliant on U.K. CCPs, but the EC acknowledged that there would be risks to the bloc's financial stability once the equivalence expires.

The commission is planning in the second half of 2022 to bring forth measures that will develop central clearing activities in the bloc to lessen the region's "overreliance" on third-country CCPs, as well as to enhance the liquidity of EU CCPs and to better manage risks related to them.

The EC launched a public consultation that will run until March 8 for the planned measures.