In its input to the European Commission, PensionsEurope welcomes the review of the central clearing framework in the EU.
For the challenges related to Pension Scheme Arrangements’ (PSAs) upcoming clearing obligation, the best way forward is a structural solution, involving central bank liquidity, as central clearing houses in Europe would suffice to provide (indirect) central bank liquidity utilizing their cleared repo platform. Therefore, PensionsEurope proposes to the Commission that the solution would be that the European central clearing houses could provide central bank liquidity to PSAs in times of stress to convert high quality government bonds into cash.
PensionsEurope agrees with the recent ESMA advice to the Commission that an extension of PSAs’ exemption from clearing obligation until 19 June 2023 is still needed.
