EU Agrees on Clearing Law for Over-the-Counter Derivatives

European Union officials and lawmakers brokered a deal on rules to force trading of some over-the-counter derivatives through clearinghouses to safeguard financial markets.

The law, approved after negotiations in Brussels today, will empower EU regulators to decide on types of derivatives that should be centrally cleared. Traders who flout the rules would face penalties including fines. The law also sets rules on management of clearinghouses, including on reserves they must hold to protect themselves from insolvency.