THE European Union's markets watchdog has proposed a temporary fix to avoid uncleared derivatives contracts worth trillions of euro being disrupted if there is a no-deal Brexit next March.
Derivatives can act as a form of insurance in large-scale financings.
The European Securities and Markets Authority (ESMA) said the changes would give banks one year to "repaper" or shift their uncleared, over-the-counter derivatives positions from London to the EU.
Such moves would not trigger the requirement to clear those contracts. Customers can begin taking steps to shift contracts - which requires permission from the end-customer - but make any action conditional on a no-deal departure, ESMA said.