United States: Council Of EU Agrees General Approach On Proposed Regulation On Securities Financing Transactions

On November 20, the Council of the EU published a press release reporting that its Permanent Representatives Committee (COREPER) has agreed its approach on a draft regulation on reporting and transparency of securities financing transactions (SFTs) (the SFT Regulation).

SFTs are often carried out by the shadow banking sector and rely on assets belonging to the counterparty to generate financing.  They mostly involve lending or borrowing of securities and commodities, repurchase or reverse repurchase transactions, or buyback/sell-back transactions.

The SFT Regulation is intended to enhance financial stability by ensuring that information on SFTs is efficiently reported to trade repositories and investors in collective investment undertakings.

The Commission published its legislative proposal for the SFT Regulation in January 2014 and the Council published its first compromise proposal in October 2014. The Council's agreement enables negotiations to commence as soon as the negotiating team of the European Parliament is entrusted with a mandate. The aim is to adopt the SFT Regulation at first reading. Press Release.

On November 20, the Council of the EU published a press release reporting that its Permanent Representatives Committee (COREPER) has agreed its approach on a draft regulation on reporting and transparency of securities financing transactions (SFTs) (the SFT Regulation).

SFTs are often carried out by the shadow banking sector and rely on assets belonging to the counterparty to generate financing.  They mostly involve lending or borrowing of securities and commodities, repurchase or reverse repurchase transactions, or buyback/sell-back transactions.

The SFT Regulation is intended to enhance financial stability by ensuring that information on SFTs is efficiently reported to trade repositories and investors in collective investment undertakings.

The Commission published its legislative proposal for the SFT Regulation in January 2014 and the Council published its first compromise proposal in October 2014. The Council's agreement enables negotiations to commence as soon as the negotiating team of the European Parliament is entrusted with a mandate. The aim is to adopt the SFT Regulation at first reading. Press Release.

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