LONDON (Reuters) - The European Union's three financial watchdogs have proposed a limited waiver from posting margins on uncleared derivatives transactions to minimize market disruption if Britain leaves the bloc next March without a deal.
The European Banking Authority, European Securities and Markets Authority, and the European Insurance and Occupational Pensions Authority, said in a joint statement the limited exemption would give market participants time to "novate" or shift contracts from Britain to the EU.
"Counterparties should start negotiating as soon as possible the novations of their transactions which are in the scope of these amending regulations, given the twelve month timeframe to benefit from it," the watchdogs said.