A new vision for agriculture
momagri, movement for a world agricultural organization, is a think tank chaired by Christian Pèes.
It brings together, managers from the agricultural world and important people from external perspectives,
such as health, development, strategy and defense. Its objective is to promote regulation
of agricultural markets by creating new evaluation tools, such as economic models and indicators,
and by drawing up proposals for an agricultural and international food policy.
A look at the news

CFTC / EU agreement:
towards a new framework for harmonized regulation

February 22, 2016

On 11th February, the European Commission and the Commodity Futures Trading Commission (CFTC), the main US regulator of financial commodity markets, finalized a reciprocal agreement on the regulation of derivatives. This agreement puts an end to years of negotiations based on the principle of extraterritoriality, so dear to Americans. The deal negotiated means both parties recognize approvals from both European and American clearinghouses. Thus, when a cross-border transaction is subject to clearing, the question of which chamber should clear the transaction no longer arises.

“This is an important step forward for global regulatory convergence”, said Jonathan Hill, EU commissioner for financial services. “It has taken a long time, but it is good news that after more than three years of discussion, we are now able to provide certainty for the marketplace”.

Contrary to fears about the risks of a downward harmonization of the various health rules within the future transatlantic partnership, this agreement is indeed good news with regards the future framework of financialised markets. The European Union will benefit from practices, tried and tested by the US in terms of regulation, transparency and managing excessive speculation.

Indeed, the United States have plenty of experience in terms of regulating financial markets for agricultural commodities. President Obama’s signing of the Dodd Frank Wall Street Reform and Consumer Protection Act on 21st July 2010, helped reorganize the supervision of derivatives markets. The law reintroduced transparency and counterparty obligations on over the counter markets and will provide for the revision and reinforcement of position limits. Thus, some 28 agricultural commodity-backed futures, energy products or metals as well as swaps which are their “economic equivalent” fall within these limits. Up until now, only 9 agricultural commodities were managed this way.

It is therefore an upward harmonization that should be hoped for from the pursuit of the process. Because in an environment of instability and uncertainty marked by market hyper-volatility, to (re)-activate a common regulatory governance in terms of regulation is no longer an option but a necessity.

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Paris, 17 June 2019