In the midst of heated Brexit negotiations, a technical subject, but of great importance, is on the way to finding a temporary solution.
The European Commission is preparing at the beginning of the week to grant an eighteen-month authorization to the City's euro clearing houses, after the expiry of the transition period which maintains until the end of the year the United Kingdom in the Single Market.
Concretely, derivative product transactions in euros will be able to continue until mid-2022 to be cleared in the
London
clearing houses
.
These intermediaries intervene between buyers and sellers of financial products to secure transactions.
This is called the “infrastructure” of the market or, more prosaically, its “piping”.
This represents the trifle of 735,000 billion euros per year.
However, on the sole activity of derivatives in euros, 90% are cleared in London by the company LCH, a subsidiary of the London Stock Exchange.
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