Well, the dividing lines are well and truly set. Unsurprisingly the exchanges have come out in favour of the EC proposed OTC reforms (see below), and simultaneously several trade bodies have come out fighting against them.

Anthony Belchambers of the Futures and Options association released a statement saying "...(The Communication) still poses serious questions over the continued capacity of the OTC markets to service adequately the essential risk-management needs of insitutional customers and counterparties...there are also continuing concerns over whether the impact of new capital rules, conservative margin requirements and tighter collateralisation, not to mention the prospect of position limits, will adversely impact the underlying economis of risk management.

ISDA also released a statement on the requirement for dealers to use exchanges saying, "...Mandated exchange trading could limit the flexibility of derivatives users to hedge their risk exposure...some forms of price disclosure and inappropriate forms of standardisation will harm liquidity by disincentivising participation in derivatives markets..."