The European Securities and Markets Authority (ESMA) on Thursday announced it has signed a memorandum of understanding (MoU) with Hong Kong’s Securities and Futures Commission (SFC) that will facilitate the exchange of information on derivative contracts that is being collected by trade repositories.

The agreement, which took effect on Nov. 19, allows the SFC and ESMA to have indirect access to information on derivatives contracts in order to fulfil their respective regulatory mandates.

ESMA already has an arrangement with Australian authorities (the Australian Securities & Investments Commission (ASIC) and the Reserve Bank of Australia (RBA)) that provides direct access to trade repository data, the announcement notes, but this new deal with Hong Kong is the first arrangement between regulators to establish indirect access to trade repositories through exchanges of information.

This new type of arrangement follows a recommendation from the Financial Stability Board (FSB) to enter into these kinds of deals as a way to overcome legal barriers to accessing data on derivatives trades when direct access by foreign authorities to this sort of data is not possible.