The Central Counterparties (Equivalence) (India) (Reserve Bank of India) Regulations 2023

EXPLANATORY NOTE

(This note is not part of the Regulations)

These Regulations set out the Treasury’s equivalence determination in respect of the regulatory framework that applies to certain central counterparties (CCPs) that are established in India and authorised by the Reserve Bank of India (RBI).

These Regulations are made in exercise of the powers conferred by Regulation (EU) No 648/2012 of the European Parliament and of the Council of 4th July 2012 on OTC derivatives, central counterparties, and trade repositories (UK EMIR). Article 25(1) of UK EMIR provides that a CCP established overseas may only provide clearing services to clearing members or trading venues established in the United Kingdom where that CCP is recognised by the Bank of England. The Bank of England is only able to recognise a CCP where the overseas market in which they operate has been determined as equivalent by the Treasury.

Regulation 2 sets out the Treasury’s determination that the regulatory framework in relation to CCPs authorised and designated as financial market infrastructure (FMI) by the RBI is equivalent to the United Kingdom’s framework. Any CCP designated as an FMI by the RBI is required by the RBI to comply with the Principles for Financial Market Infrastructures issued by the International Organization of Securities Commissions.

Not all CCPs authorised by the RBI are subject to the legal and supervisory framework that applies to CCPs designated by the RBI as FMIs. A list of the CCPs designated as FMIs by the RBI is available at www.rbi.org.in. There are also other entities in India that regulate CCPs that are not covered by these Regulations.

An impact assessment of the effect that this instrument will have on the costs of business, the voluntary sector and the public sector is available from the Treasury, 1 Horse Guards Road, London SW1A 2HQ and is published alongside this instrument at www.legislation.gov.uk.