The Reserve Bank of India (RBI) and the European Securities and Markets Authority (ESMA) have signed a Memorandum of Understanding (MoU) to strengthen cooperation and exchange of information related to central counterparties (CCPs) regulated and supervised by the RBI.
The MoU replaces an earlier agreement signed on February 28, 2017, and provides a framework for regulatory cooperation between the two authorities in line with their respective laws and regulations.
Under the agreement, ESMA will be able to place reliance on the RBI’s regulatory and supervisory activities while safeguarding the European Union’s financial stability. The MoU also underscores the importance of cross-border supervisory cooperation to facilitate international clearing activities.
The agreement was signed by RBI Executive Director Vivek Deep and ESMA Chair Verena Ross.
Path cleared for CCIL recognition
The MoU is a key requirement under Article 25 of the European Market Infrastructure Regulation (EMIR) for ESMA’s recognition of third-country CCPs. It enables the Clearing Corporation of India Ltd (CCIL), which is supervised by the RBI, to reapply for recognition under EMIR.
The lack of EU recognition for CCIL had been a long-standing issue since 2022, restricting access for EU clearing members to Indian CCPs. The signing of the MoU addresses this regulatory gap and marks a significant step towards restoring such access.
ESMA said the agreement follows two years of sustained engagement with the RBI and reflects its commitment to international supervisory cooperation and resilient, open financial markets.
ESMA is also continuing discussions with the Securities and Exchange Board of India (SEBI) and the International Financial Services Centres Authority (IFSCA) to conclude similar cooperation arrangements.
