The leading knowledge platform for the financial technology industry
The leading knowledge platform for the financial technology industry

A-Team Insight Blogs

EFETnet’s and DTCC Selected by Industry to Develop Commodity Derivatives Trade Repository

Share article

EFETnet and DTCC Deriv/SERV (DTCC), announced that the two at-cost, user governed industry cooperatives are collaborating with market participants in the commodities industry to establish a global Commodity Derivatives Trade Repository. The proposed new repository, which will be domiciled in Europe and jointly owned by DTCC and EFETnet, follows EFETnet and DTCC being selected by the International Swaps and Derivatives Association, Inc.’s (ISDA) Commodities Steering Committee to work with the industry on the next stage of development for this new service.

EFETnet and DTCC’s industry non-commercial cooperative models will create a joint neutral platform where many competing organizations can come together to participate in a single non-commercial reporting solution. Such a single, non-commercial, truly transatlantic solution allows regulators globally to receive from one source most if not all of the OTC commodity derivative trade data in which they have a regulatory or supervisory interest – without each regulator having to aggregate data from multiple sources which may result in double counting or omissions, or simply in improper understanding due to variations in data formatting. It will also allow aggregate market information made available to the general public to be more complete and accurate.

The joint-venture integrates EFETnet’s vast experience in the commodities arena and its deep network of contacts in the user community with DTCC’s proven track record in building global trade repositories. The combination also brings together representatives of the purely commodity trading community with representatives of the financial services community, and, although the joint venture will be headquartered in Europe, it will be a truly transatlantic strategic partnership.

The joint-venture between EFETnet and DTCC, which is subject to final documentation, brings together EFETnet’s secure data communications and post trade processing capabilities as well as DTCC’s repository and regulatory reporting infrastructure. The combination will provide the commodities industry with an at cost, industry owned and governed cooperative to streamline reporting to multiple regimes.

“This joint EFETnet and DTCC initiative, in partnership with the industry, is truly an international exercise that aims to meet the current and future regulatory needs of our customers in the commodity derivatives market,” said Jan van Aken, Secretary General, EFET. “We are pleased to partner with DTCC to develop a service that will ultimately record all commodity OTC derivatives transactions, which can only strengthen the infrastructure for the trading of these instruments.

“DTCC remains committed to partnering with the industry and regulators globally to strengthen, bring greater clarity and mitigate risk in the OTC derivatives market,” said Peter Axilrod, managing director, Business Development and OTC Derivative Services, DTCC. “EFETnet’s expertise in working with the European commodities and energy user community is a strong complement to DTCC’s experience automating and bringing increased safety into the OTC derivatives market. We believe our joint service delivers a great value proposition to market participants in this asset class.”

Related content

WEBINAR

Recorded Webinar: Adopting Entity Data Hierarchies to Address Holistic Risk Management

Firms across the board are struggling to gain a comprehensive view of their counterparty risk. In the wake of the Credit Crisis, regulators have increased their focus on pushing firms to not only better understand risk exposure, but also be able to provide evidence of the analysis they use to create their view of risk....

BLOG

FATF Echoes SmartSearch in Call for Digital Onboarding

The Financial Action Task Force (FATF), a multinational body that sets a global approach to fighting money laundering and financial crime, has backed a call by UK-based anti-money laundering software specialist SmartSearch urging businesses to employ digital customer onboarding processes during the coronavirus lockdown. SmartSearch stresses that firms relying “outdated paper-based ID checks” should switch...

EVENT

Data Management Summit USA Virtual

Data Management Summit USA Virtual will explore how sell side and buy side financial institutions are navigating the global crisis and adapting their data strategies to manage in today’s new normal environment.

GUIDE

Entity Data Management Handbook – Sixth Edition

High-profile and punitive penalties handed out to large financial institutions for non-compliance with Anti-Money Laundering (AML) and Know Your Customer (KYC) regulations have catapulted entity data management up the business agenda. So, too, have industry and government reports on the staggering sums of money laundered on a global basis. Less apparent, but equally important, are...