REGIS-TR in talks with FCA over UK trade repository

John Kernan interview with Global Investor's Pablo Mayo Cerqueiro


The article was originally published by Global Investor Group on 9 August 2018.

Regis-TR, Clearstream’s trade repository, is in discussions with UK regulators about whether it will need to set up a local entity to ensure access to clients after Brexit, officials at the firm told Global Investor.

“We’ve had very constructive conversations with the FCA and the Bank of England, but because it’s tied into the overall political negotiations in a wider sense, at this stage there’s no complete clarity on what’s required,” said John Kernan, a senior vice-president in charge of product and business development at the firm.

Luxembourg-based Regis-TR – a joint venture of international central securities depository Clearstream and Spanish CSD Iberclear – services clients across the EU reporting derivatives trades under the European Market Infrastructure Regulation (Emir) and is developing a similar service for securities financing transactions.

It has no separate legal structure in the UK, but Clearstream has a presence in London with a business development team focused on Regis-TR.

Sabine Guip, Regis-TR’s chief compliance officer, said the firm could potentially be allowed to operate in the UK as a registered foreign repository but warned that is “highly dependent” on the political negotiations between Britain and the rest of the EU.

“There might be two options: one option is to set up a new entity in the UK and the other to get recognised as a foreign trade repository as we’ve been recognised for (Switzerland),” she said.

Asked about how long it would take for it to set up shop in Britain if required, Regis-TR argued that would vary depending on the type of legal structure demanded by UK authorities.

The firm said it would have to hire new personnel or transfer staff to the UK to support a new entity but emphasised that its parent company has infrastructure and expertise already in place.

“That first option (setting up a UK entity) might not be quite so dramatic for us because we have, through our parent company Clearstream, physical infrastructure there, we already have people in London who are already working 100% for Regis-TR,” Kernan added.

“It’s not like we would have to build it from the ground up,” he concluded, adding that a trade repository based in the UK will also have to secure authorisation from UK regulators post Brexit.