News & Opinion

The European Securities and Markets Authority (ESMA) and the Commodities Futures Trading Commission (CFTC), ESMA’s US equivalent for futures market oversight, have officially come to agreement over equivalence between the clearing frameworks of the two jurisdictions. It spells the end of a long running dispute between the world’s two largest derivatives markets that has held up the implementation of mandatory central clearing, a key tenet of the G20’s 2009 Financial Reform Programme.

On Tuesday 01 March, Thomas Murray hosted a half day event in London entitled Post-Trade Risk Roundtable. The event sought to explore the regulatory hurdles being faced by those involved with the funds industry, and how firms can prepare to clear these challenges in their post-trade networks.

Topics discussed on the day included: 

The hedge fund industry has come under varied and increasing pressure and scrutiny in the wake of the global financial crises. Both investors and regulators are paying much closer attention to the way in which funds identify and mitigate for, operational risk. This is bringing about very real changes in the way that funds are structured and managed, right the way through the business.

HSBC has added the United States to its network of markets in which the bank clears and custodies the assets of its clients directly. HSBC has done all this, with varying degrees of difficulty, in dozens of markets around the world. But doing it in the United States is far from being a case of business-as-usual. It in fact marks a major break with the past. The question is why.

Fund managers have traditionally based their funds offshore to ensure they can distribute their funds to investors everywhere without worrying that the income and capital gains they generate might be taxed at a higher rate than their investors appreciate. ACS, the as yet little noticed onshore vehicle created by the UK government and tax authorities, might be about to rewrite that logic.

Ed Turner of HSBC provides an overview of ACS, the new UK fund vehicle:

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