EU to strip five countries of market access rights

EU to strip five countries of market access rights

D02 E 211 V 14 02 2021

Description video:
Financial Management\nMedium – English\nDate – 14.02.2021

EU to strip five countries of market access rightsEU to strip five countries of market access rights

The European Commission believes Canada, Brazil, Singapore, Argentina and Australia do not regulate credit rating agencies with the same rigor as the EU, according to the Financial Times..

When this decision comes into force, countries that have lost their status will have limited access to the markets.

Access rights can be revoked for the first time in history.

According to the FT, about 40 equivalence clauses are scattered across different EU financial rules and are designed to enable trading platforms, brokers and other companies based in non-EU financial centers to serve European clients if they are heavily regulated and supervision.

EU to strip five countries of market access rights

Regulations are used in over 30 countries.

Valdis Dombrovskis, Vice President of the EU Commission in charge of financial regulation, told the FT that the decision on rating agencies creates «a kind of precedent for monitoring compliance».

«We had a wide dialogue with these countries, so they knew that there was a problem, and they knew that there could be consequences», – he said.

The move is seen by some as a warning to the UK that it will comply with EU rules if, after leaving the EU, it wants its trading platforms and financial firms to continue to have direct access to customers..

In turn, the head of the European compliance department at DBRS told the FT that the EU’s decision to lift the equivalence for Canada would not have an impact on the agency’s business..