Sinn Fein MEP Matt Carthy has condemned the move by the European Parliament to weaken regulation of the derivatives market in the EU. Carthy was addressing the plenary of the European Parliament in Strasbourg this evening, Monday, in a debate preceding a vote to review the EMIR regulation enacted in 2012. The vote, due to take place on Tuesday, has the support of the major groups in the Parliament.
Addressing MEPs, Carthy said: “As we all know, and as G20 leaders themselves acknowledged in Pittsburgh in 2009, derivatives were at the very heart of the global financial crisis.
“When we’re talking about regulating a market worth more than 500 trillion dollars, we need to get it right.
“EMIR, the post-crisis framework for the regulation of over-the-counter derivatives, has its problems, but it is a crucial instrument for ensuring financial stability.
“This review proposal bends over backwards to meet the demands of the industry – an industry that just a decade ago brought our economies and societies to the brink of collapse.
“I share the concerns that this move reflects a more general effort by the European Parliament to roll back and unpick the financial regulations put in place after the crisis.
“The weakening of regulations may be targeted at the smaller market participants – but the nature of this market is that it is a chain of interdependencies that promotes risk volatility.
“We have a responsibility as legislators to ensure the derivatives industry is bound by strict and high-standard regulations on transparency, reporting and clearing, but I fear this parliament is failing to meet that responsibility through this review.”