(6)The impact of the withdrawal of the United Kingdom from the Union has been the subject of several communications from the Commission to the European Parliament, the Council and ECB, including a Contingency Action Plan urging preparedness and readiness on the part of market participants 5 . The volume of current exposures of Union clearing members towards UK CCPs, the fundamental changes in the regulatory and supervisory framework applicable to UK CCPs and the United Kingdom financial system in general that will occur on 1 January 2021, together with the risks for the financial stability of the Union and for the transmission and conduct of the Union’s monetary policy, requires the scaling down of the reliance on United Kingdom infrastructures. This implies the reduction of Union clearing members’ exposures to UK CCPs, in particular OTC derivative exposures that are denominated in euro and other Union currencies, and a further extension and development of the capacity of CCPs authorised in the Union to provide such services. In order to achieve such reduction the industry is expected to develop a clear process to reduce their exposures and reliance on UK CCPs that are systemically important for the Union.
Recital 6
- 5 Communication from the Commission to the European Parliament, the Council and the European Central Bank of 4 May 2017, ‘Responding to challenges for critical financial market infrastructures and further developing the Capital Markets Union’ (COM (2017) 225 final), Communication from the Commission to the European Parliament, the European Council, the Council, The European Central Bank, the European Economic and Social Committee, the Committee of the Regions and the European Investment Bank of 19 July 2018, ‘Preparing for the withdrawal of the United Kingdom from the European Union on 30 March 2019 ’ (COM(2018) 556 final) and Communication from the Commission to the European Parliament, the European Council, the Council, The European Central Bank, the European Economic and Social Committee, the Committee of the Regions and the European Investment Bank of 13 November 2018, ‘Preparing for the withdrawal of the United Kingdom from the European Union on 30 March 2019: a Contingency Action Plan’ (COM(2018) 880 final). ↩