According to bankingtech.com, senior financial industry executives are less than pleased with the US and EU’s inability to work together on the implementation of derivatives reforms and swap execution facilities.
While the Dodd-Frank Act was instituted by the US government to help create transparency in the swaps market, often cited as a major cause of the 2008 financial crisis, its effects reach far beyond United States law.
In order to remedy this, the CFTC and the European Commission signed a deal to hold each other’s laws equivalent when the circumstances allowed, showing real progress towards cross border cooperation over these new laws.
However,while the United States has been moving quickly to comply with the Dodd-Frank Act’s rules, the European Commission has been pleading with the CFTC to be given more time. However, they had not yet received a response when the deadline for almost all derivatives traders register with SEFs went through, and now it seems that the European Commission is being left in the dust.
This is causing concerns among European firms over whether or not they will be liable, and it seems they won’t be getting answers any time soon, as the CFTC currently has its hands full just trying to monitor the market thanks to the government shutdown, which has left the commission with almost no personnel.