European Central Bank seeks power over key financial sector

FRANKFURT – The European Central Bank is asking for legal powers to oversee how transactions involving financial derivatives are settled — a hot topic in negotiations over Britain’s departure from the European Union.

The ECB said Friday it has asked EU authorities for “clear legal competence” to regulate clearing of derivatives.

Clearing centres act as intermediaries in the buying and selling of derivatives, which are financial contracts that derive their value from an underlying asset such as oil, gold or currency.

Much of the activity in clearing euro-denominated derivatives is located in London and involves thousands of jobs in the financial sector.

The European Commission has proposed that clearing houses considered important to the EU financial system accept regulation from the bloc and if requested move to within the bloc.