Apr. 1, 2026
The Treasury Markets Association (TMA) in Hong Kong supports the subject request for exemptive relief from the Trade Submission Requirement for transactions between non-US Treasury securities CCA participants and non-US clients to ensure the continued efficiency of the conduct of US Treasury market activities in Hong Kong and Asia. Our position is based on the following: Operational & Time Zone Realities: The current lack of 24-hour operation by US Treasury securities CCAs creates a structural mismatch for Asia-based activity. Mandatory clearing for purely offshore flows would create avoidable operational burdens and risks for participants in our time zone. Preserving Market Liquidity: Disproportionate clearing costs and administrative burdens may deter offshore participation in the UST and repo markets, potentially shifting activity to other sovereign markets and impacting market resiliency. Legal Enforceability: Mandating clearing for purely non-US relationships through US Treasury securities CCAs may bring up concerns on legal enforceability uncertainty, for instance, in jurisdictions where netting enforceability is governed by local laws. Policy Consistency: We advocate for an approach consistent with the CFTC’s swaps framework, which applies a more limited extraterritorial reach to better reflect the realities of cross-border market structures. Implementation Recommendation: TMA also recommends that the exemption be automatic and self-effectuating in order to minimize operational friction. Market participants should be permitted to rely on standard entity classification and existing KYC records rather than a centralized "approved list" or new documentation requirements to achieve smooth implementation.