Cooperation has, in fact, always been the ECB’s preferred approach to the oversight of financial market infrastructures (FMIs). This cooperation should rely on two elements, as agreed at the international level: first, effective cooperative oversight arrangements and, second, crisis management groups to allow for mutual consultation in recovery and resolution planning. Unfortunately, for several global CCPs, these arrangements do not yet exist, or do not involve all relevant authorities, despite international commitments. These delays are a source of concern, not least as seven years have passed since the adoption of the PFMIs5, and almost five years since international standards were adopted for both the recovery6 and resolution7 of FMIs. I urge all parties involved to accelerate progress in this area. 2/5  BIS central bankers' speeches  The Eurosystem needs to be able to conduct effective oversight Cooperation is also indispensable for the second topic of today’s conference, namely CCP liquidity and the role of the central bank of issue. In Europe, cooperation ensures that the ECB and the Eurosystem can conduct effective oversight of euro-denominated clearing activities, wherever they may be established. In 2017 the ECB recommended an amendment to its Statute to clarify its competence over CCPs for the purpose of carrying out its monetary functions.8 The ensuing debate among legislators and policymakers in the EU and beyond was marred by some misunderstandings, however, which I would like to dispel today. As you all know, some central banks are CCP supervisors. The ECB is not, 9 and has no intention of becoming one.

In this respect, despite significant legislative efforts, the lack of ambition of the current revision of the European Market Infrastructure Regulation (EMIR) is regrettable.4 Given that the brunt of default risk in EU CCPs is borne by their clearing members, most of whom are directly supervised at the European level, the principle of aligning liability and responsibility clearly implies European supervision of EU CCPs. The current text can at best be seen as a modest step in that direction. At the global level, we should strive for an international framework based on two pillars: proportionality and cooperation. Proportionality means that where financial stability implications are limited, outcomes-based equivalence and full deference mechanisms, based on compliance with international principles, can allow for cross-border activities that meet minimum standards of safety and soundness. Where global CCPs are systemically important for financial systems or currency areas, however, each authority should have the right and duty to ensure that imported risk is managed at least as diligently as its own standards would dictate. This is the core purpose of the revisions to the EU’s recognition framework for third-country CCPs. The European Commission and EU legislators have taken a balanced approach to ensure that this can be implemented in a pragmatic, flexible and efficient manner. The success of this framework, however, relies on enhanced cooperation between authorities. Cooperation fosters trust, thus facilitating deference among supervisors to the extent possible. It also helps the authorities in implementing overlapping expectations based on different mandates in a coherent and mutually satisfactory manner.