1 Amendments of Arlene McCARTHY related to 2010/0250(COD)
Amendment 131 #
Proposal for a regulation
Recital 4
Recital 4
(4) Over-the-counter (OTC) derivatives lack transparency as they are privately negotiated contracts and any information concerning them is usually only available to the contracting parties. They create a complex web of interdependence which can make it difficult to identify the nature and level of risks involved. The financial crisis has demonstrated that such characteristics increase uncertainty in times of market stress and accordingly, pose risks to financial stability. This Regulation lays down conditions for mitigating those risks and improving the transparency of derivative contracts. While exchange traded derivatives are more transparent than OTC contracts it is important to ensure loopholes are not left in the regulatory framework. To ensure a coherent and consistent approach the appropriate provisions for exchange traded derivatives should be addressed in the context of the review of the Markets in Financial Instruments Directive (MiFID).