PARIS, July 12 (Reuters) - The business lobby organisations for Paris and Frankfurt on Wednesday stepped up their pressure to move euro clearing businesses away from Britain in the wake of Brexit by asking for rules that could effectively exclude London based activity.
In a joint statement, Paris Europlace and Frankfurt Main Finance said the legal framework governing central counterparties for euro clearing businesses should fall under the jurisdiction of the European Court of Justice - a European Union institution.
“Frankfurt Main Finance and Paris EUROPLACE urge the responsible European authorities to clarify their position without delay and by doing so, bolster certainty in this systemically relevant pillar of the European financial system,” said their joint statement.
The European Union is planning to give itself powers to move euro clearing business away from London’s financial sector to the EU after Brexit and adopt a model closer to that operated by the United States.
The bulk of clearing in euro-denominated derivatives is performed in London and involves a third party standing between two sides of a trade to ensure its smooth and safe completion. (Reporting by Sudip Kar-Gupta; Editing by Andrew Callus)