Half a job

MiFID, the mother of all European financial regulation, rumbles on and on. The European Commission’s MiFID IIconsultation in 2011, the Ferber Report in March 2012, and the European Parliament vote in October 2012 were all highly anticipated and widely reported on. But despite the fact that the Council of Ministers has published more than 20 different drafts during the Cyprus and Ireland presidencies alone, it’s still unlikely that we’ll see a final text before the handover to Lithuania at the end of this month. With the trialogue still on-going too, it’s a wonder any of us can actually remember what was initially proposed way back in 2011.

The 2009 G20 commitment called for improvements to the OTC derivatives markets with regard to both trading and clearing. EMIR, with its increased post-trade transparency, re-engineering of market infrastructure and clearing mandate, is being implemented right now, albeit with the registration of Trade Repositories delayed until August 2013. So, while on the clearing side Europe makes steady progress, we see no movement on the trading side. Still procrastinating over the missing piece around electronic trading platforms, aka Organised Trading Facilities, it’s likely that the EU will see half of the G20 reforms implemented, with the rest subject to further delays and uncertainty. Granted, the US has also faced a number of delays, such as the renewed extension for Rule 1.73, but compared to the progress made with the Dodd-Frank Act, Europe looks like doing half a job.