The European Union is proposing to give the European Central Bank sweeping powers over foreign clearing houses in times of market stress, an EU document showed, as the bloc shows little sign of heeding U.S. calls to water down the plans.
The bloc has proposed changing the ECB’s statute to give it a broad role in the oversight of EU and foreign clearing houses that handle large amounts of euro-denominated securities. That would include those in London, which will lie outside the EU in five months’ time.
Now the current EU president Austria has proposed fleshing out the role with detailed powers, such as being able to force foreign clearing houses to “submit information, cooperate in the assessment of their resilience to adverse market conditions, and open overnight deposit accounts”, the document said.