A group of trade bodies have urged EU legislators to scrap plans to introduce new rules that would force European firms to clear some of their derivatives in European clearing houses.

In a joint statement, 11 groups, including the European Fund and Asset Management Association and the International Swaps and Derivatives Association, called on the proposed active account requirement to be voted down.

The regulations were intended to bring euro-denominated interest rate swaps from LCH in London, which holds over a 90% market share on clearing them.

However, the groups argued that the requirements would disadvantage European firms and make them less competitive, as non-EU firms trading in euro derivatives would not be subject to the requirement.

"A location requirement for market participants would make the EU one of the only advanced capital markets with such a policy," the statement said.

The groups added, that reforms to derivatives markets implemented since the Global Financial Crisis had made them safer, and argued it was important not to disrupt and fragment the global clearing market.

"The proposed active account requirement would negatively impact EU capital markets by introducing fragmentation and loss of netting benefits, and make the EU less resilient to market stresses, with no benefit to EU financial stability," the notice said.

"Ultimately, it would harm European pension savers and investors."