The European Central Bank (ECB) and the Reserve Bank of India (RBI) on Sunday signed a new memorandum of understanding aimed at strengthening cooperation in central banking and facilitating regulatory coordination for clearing corporations.
The agreement was signed by ECB President Christine Lagarde and RBI Governor Sanjay Malhotra on the sidelines of the Bank for International Settlements (BIS) meetings in Basel.
The MoU replaces and updates an earlier framework signed in 2015 to meet the evolving institutional and regulatory requirements of both sides.
Under the agreement, the RBI and ECB will engage in regular exchange of information, policy dialogue and technical cooperation.
The collaboration may include seminars, workshops and other joint initiatives in areas of mutual interest.
A key objective of the MoU is to pave the way for formal recognition of the Clearing Corporation of India Ltd. and other RBI-regulated Central Counterparties by the European Securities and Markets Authority.
The framework also outlines cooperation between RBI and ESMA in supervisory and regulatory practices related to covered CCPs, including exchange of information and monitoring compliance with recognition conditions.
ESMA will rely, where appropriate, on the RBI's regulatory and supervisory framework, while recognising that the Indian central bank remains responsible for oversight of the CCPs under its jurisdiction.
The MoU is non-binding in nature, does not override domestic laws and will remain effective indefinitely from the date of signing.
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