On September 26, ISDA and the FIA responded to the CFTC’s notice of proposed rulemaking on derivatives clearing organizations’ (DCOs) recovery and orderly wind-down plans.
The associations acknowledge that CCP recovery, resolution and wind-down planning is paramount to preserving financial stability. They also welcome the CFTC proposal, which is well-balanced as it outlines a comprehensive analysis for DCOs, while preserving the flexibility required to adapt to changing circumstances.
The response advocates for:
- A requirement to limit clearing members’ CCP exposures during recovery and resolution;
- Non-default losses to be borne by CCPs;
- Clearing participants incurring losses due to use of recovery measures should be fairly compensated via future CCP profit sharing;
- Clearing participants to be adequately involved in the design phase of such recovery and wind-down plans;
- Within their plans, DCOs to meticulously assess any potential impact of all measures (such as the use of specific recovery tools) on clearing participants and other stakeholders.
The response to the CFTC consultation can be found here.
Documents (1) for ISDA, FIA Respond to CFTC Consultation on DCO Recovery and Orderly Wind-Down
Latest
ISDA Trading Forum Tokyo: CEO Remarks
ISDA Derivatives Trading Forum Tokyo October 17, 2025 Opening Remarks Scott O’Malia ISDA Chief Executive Officer Good afternoon, and welcome to the ISDA Derivatives Trading Forum. It’s great to be back in Tokyo, and I’d like to begin by...
Future of Asset Management in Japan: CEO Remarks
Future of Asset Management in Japan October 17, 2025 Welcoming Remarks Scott O’Malia ISDA Chief Executive Officer Good morning, and welcome to this ISDA event on the Future of Asset Management in Japan. We’re delighted to be holding this...
New Report on Japan's Asset Management Ambitions
ISDA and Crisil Coalition Greenwich shows that derivatives are expected to play a pivotal role in Japan’s ambition to become a global leader in asset management, but some barriers need to be reduced to enable the country’s asset managers to...
The Derivatives Market in Japan
A healthy derivatives market is an important element to Japan’s plan to become a global leader in asset management. Asset managers are eager to increase their use of derivatives to better take and manage risk, but note that there is...