The Hong Kong Monetary Authority (HKMA) and Securities and Futures Commission (SFC) today (10 March) launched a joint consultation on proposed changes to the types of transactions subject to clearing obligations under the Clearing Rules (Note 1) for over-the-counter (OTC) derivatives (Note 2).
The proposals are in line with global interest rate benchmark reform, particularly the transition from the use of interbank offered rates (IBORs) to alternative reference rates (ARRs). It is proposed that the current requirement under the Clearing Rules to clear certain OTC derivative transactions referencing IBORs that are, or will no longer be, published or considered representative would be replaced by the new requirement to clear certain OTC transactions referencing the relevant ARRs.
Interested parties are invited to submit comments to the HKMA or SFC by 11 April 2023. The joint consultation paper can be downloaded from the websites of the HKMA or SFC.
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