July 18, 2018 / 8:54 AM / in 9 months

DTCC opens Irish trade reporting base to avoid Brexit disruption

LONDON (Reuters) - DTCC, the world’s biggest derivatives reporting house, said it will open a base in Dublin to continue serving European Union customers after Britain leaves the bloc next year.

The DTCC said its new Irish arm will offer a service for reporting derivatives traded on and off an exchange.

“Our continued growth and desire to get ahead of new regulatory obligations, because of Brexit, now takes us across the Irish Sea to Dublin,” Simon Farrington, DTCC’s managing director in EMEA, said in a statement on Wednesday.

“We look forward to hiring and developing a local team.”

Reporting derivatives transactions became mandatory after the global financial crisis showed that a lack of transparency in the sector accentuated market uncertainty and made it harder for regulators to spot the build-up of risky positions.

According to data from EU regulators, the DTCC is the largest trade repository in Europe.

Several repositories have been authorised in the EU, many of them in London, and it is unclear if they will have continued access to EU customers once Britain leaves the bloc next March.

“Regardless of the outcome of the final negotiations between the EU and the UK, DTCC’s Global Trade Repository (GTR) will maintain a presence in the UK as well as aim to establish a new trade repository entity in Ireland,” said Andrew Douglas, chief executive of DTCC’s European GTR unit.

Trade repositories are authorised in the EU by the European Securities and Markets Authority (ESMA), which last week warned market participants that if they need an EU licence they must apply by the end of this month or risk being cut off from customers next March.

Several securities trading venues based in London have said they are applying for authorisation to open EU hubs in Amsterdam.

Reporting by Huw Jones; editing by Jason Neely

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