Regulators won’t get a clear picture of risks in the $550 trillion derivatives market until they prune trade reporting rules, a group of 13 industry bodies said on Wednesday.

The collapse of Lehman Brothers bank in September 2008 left regulators in the dark over who was on the other side of the lender’s derivatives trades. A similar situation arose with the near-bankruptcy of insurer AIG in the same year.

Leaders of the Group of 20 economies (G20) agreed in 2009 that all derivatives trades must be reported but a patchwork of rules has emerged, making it hard for regulators to get a simple snapshot of risks.

“Effective data reporting is absolutely essential to the derivatives reform program set out by regulators,” Scott O’Malia, chief executive of the International Swaps and Derivatives Association (ISDA), said in a joint statement with 12 other trade bodies.

In the European Union, both sides of a trade must report transactions, while in the United States, only one side must report.

Having one entity reporting the trade would cut costs and complexity as two-sided reporting has not improved the quality of data, the trade bodies said.

“In Europe, for example, the aggregate expenditure for end users that have implemented the dual-reporting framework is estimated to be in excess of 100 million euros ($114 mln),” their statement said.

A streamlined, globally consistent entity-based reporting framework would help improve the quality and accuracy of reported data, it added.

The entity would typically be the dealer or clearing house, and where two dealers trade with each other, there would be a reporting “hierarchy” to determine who reports.

The EU is already reviewing the derivatives rules it introduced after the 2007-09 financial crisis.

The chairman of the G20’s Financial Stability Board, Mark Carney, governor of the Bank of England, said last November there were “persisting challenges to the effectiveness of trade reporting, such as authorities’ ability to access, use and aggregate trade repository data”.

A key issue is who would pay for aggregating data from all the trade repositories, with six in the EU alone.

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