Michel Barnier, a key European official who has supervision over financial regulation, recently stated that the inability of the United States to create derivatives regulations that are similar to those of the European Union is holding up a trading agreement between the two jurisdictions.
Barnier indicated that he might be able to create an agreement with Gary Gensler, who currently serves as chairman of the U.S. Commodity Futures Trading Commission, before he leaves his post, according to Reuters. He said that such an understanding is needed for a trade agreement to be created.
"In the medium-term, it is a bad signal for the Transatlantic Trade and Investment Partnership," the European official told Reuters in an interview. "I hope all elements of the derivatives agreement from July can be implemented right away … The TTIP negotiations will be difficult enough without also adding on top of it the financial services' issue."
This will certainly not be the first time that Barnier has mentioned potential negative consequences that could be suffered by the U.S. in the event that the jurisdiction fails to provide certain regulations, according to The Wall Street Journal. He indicated earlier this month that EU officials would take retaliatory action if the U.S. required foreign banks with branches in the nation to hold higher capital levels.