By Martin Banks - 7th July 2011
I am optimistic that after the summer break we will be able to find a solution
EU rules to tighten derivatives laws will not be agreed until at least the early autumn, as a global crackdown on the sector faces delays on both sides of the Atlantic.
In the wake of delays by the US commodity futures trading commission, EU policymakers say their new regulations to tighten derivatives rules will not be tabled until the autumn at the earliest.
The news came as German MEP Werner Langen told parliament this week that the rules would not be ready for a first reading in Strasbourg because member states were still negotiating the details.
One issue reportedly is Britain's insistence that rules should cover all derivatives, such as in the United States, rather than just the "over the counter" (OTC) market.
World leaders agreed in 2009 that derivatives traded over-the-counter or privately among banks should be centrally cleared and reported to a repository by the end of 2012 to curb risks highlighted by the financial crisis.
The bulk of world's derivatives are traded in London and New York but while the EU and United States agree on the objectives, detail is taking more time to finalise.
Banks were hoping for an EU deal by this month to lift uncertainty on how they will have to change the way they do business.
But Langen told parliament a complete first reading vote will not be held so as to give negotiations with EU states, who have joint say, more time.
"I am optimistic that after the summer break we will be able to find a solution pretty quickly," he said.
The measure was drafted by Michel Barnier, European internal market and services commissioner.
He told MEPs this week, "This was a focus of the crisis. That is why this reform is so important. We have to respect the G20 commitments before the end of 2012."