Two TMX-owned clearinghouses have received third country CCP recognition from the European Securities and Markets Authorities (ESMA).

Both NGX, a North American energy exchange and central clearing counterparty (CCP) and the Canadian Derivatives Clearing Corporation (CDCC), Canada's national CCP for exchange-traded derivative products and repos, have been approved.

CCPs, or central counterparties, stand between buyers and sellers of financial instruments.

Regulators around the globe are working to channel more derivatives trading through clearinghouses in the wake of the financial crisis.

Recognition as a third country CCP under European Market Infrastructure (EMIR) allows CCPs from outside of the EU to provide clearing services to clearing members or trading venues inside the bloc.

It also gives CCPs the status of being qualifying CCPs (QCCPs) in the EU, meaning clearing members are subject to lower capital requirements.

“Third-country CCP recognition is an important achievement for CDCC as we continue to work to efficiently serve our existing European client base and attract additional clients to our market,” said Alain Miquelon, president and chief executive of Montréal Exchange and group head of derivatives, TMX Group.

“The NGX clearing model has a proven track record in North American energy markets,” added Jim Oosterbaan, president of NGX. “We are pleased to receive third country CCP recognition as an acknowledgement that NGX has met the standards of European regulators.”