Revised National Bank Ordinance

Revised National Bank Ordinance

As part of a relatively comprehensive review of the regulations applicable to the financial market infrastructure, the National Bank Ordinance (NBO) has been revised as a first step. The new version has been available since 25 June 2013 and will enter into force on 1 July 2013.

The National Bank Ordinance contains provisions on how to monitor financial market infrastructures, such as payment systems, securities processing systems, central custodians and central counterparties. The aim of this revision is, firstly, to consistently implement the new international standards of the Committee on Payment and Settlement Systems (CPSS) and of the International Organization of Securities Commissions (IOSCO) in Switzerland. Secondly, the revision is intended to ensure that central counterparties (CCPs) in Switzerland have access to a legal and regulatory framework equivalent to that of the EU and can therefore continue to offer their clearing services in the EU.

Action needs to be taken as a result of the European Market Infrastructure Regulation (EMIR), which came into force in August 2012. Its provisions include the creation of a uniform regulation framework and require that CCPs from countries outside the EU can only continue to offer their services in the EU if the third country has an equivalent legal basis. In a next step, the European Security Markets Authority (ESMA) has to give an advice on whether, following revision of the NBO, Switzerland fulfills the requirements for equivalent regulation and CCPs from Switzerland can accordingly continue to provide their services in the EU. ESMA is expected to announce its advice in October 2013.

Position of SIX

SIX welcomes in principle the efforts undertaken by the Swiss National Bank to implement international standards in Switzerland and to achieve equivalence with EU regulations. At the same time, SIX appreciates the good understanding it has with the relevant authorities.

For SIX, the priority is to obtain authorization from ESMA for its central counterparty in the EU, SIX x-clear AG. This is because market access to the EU is of particular strategic importance for clearing: after all, 83% of clearing transactions originate in the EU. That is why SIX accepts that the existing NBO has to be tightened up in many aspects to achieve equivalence with EU regulations. 

SIX believes there are a number of points requiring clarification, such as governance issues, the definition of the scope of the revised NBO and the practical implementation of some of the regulations. However, thanks to intensive discussions and good cooperation with the relevant authorities, SIX is confident that these unresolved issues will be addressed efficiently.