EU to Temporarily Allow UK Derivatives Clearing Houses

The European Union (EU) is set to grant temporary access to the London Stock Exchange (LSE) and other derivatives clearing houses in the United Kingdom starting January 2021.

The European Commission plans to adopt a time-limited equivalence decision for the UK for central clearing counterparties of derivatives, without clarifying the time limit for the said temporary access, Reuters reported.

This decision is being taken to address the possible risks to financial stability related to derivatives clearing, according to the commission.

London is still negotiating with the EU for a possible deal that organized the trade and financial cooperation between the two sides after Brexit.