Derivs - Regulation
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The China Securities Regulatory Commission plans to push for further foreign participation in the country’s derivatives markets in 2014, allowing foreign institutional investment firms to develop brokerages and overseas branches on the mainland.
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The South Korean Financial Services Commission is seeking to support the introduction of futures on the Kospi 200 Volatility Index next year and is also considering creating a market for new derivatives, such as sector index futures.
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Lawyers expect the U.S. government to issue an extended delay to the implementation of the foreign accounting tax compliance act, due to the burdensome requirements for financial institutions in complying.
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Scott O’Malia, commissioner of the U.S. Commodity Futures Trading Commission, has called for the extraterritorial reach of U.S. derivative reforms to be scaled back in 2014 and for the U.S. to pursue a harmonized global framework of regulation through substituted compliance.
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Australia’s financial services firms are not adequately investigating their client’s personal circumstances before recommending complex capital protected structured products, therefore not meeting guidance set under recent regulatory reforms, according to the Australian Securities and Investments Commission.
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South Korean trusts and discretionary investment managers will be permitted to engage in trading of foreign currency-denominated derivatives and derivative-linked securities next year.
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The Korea Exchange has delayed the launch of its over-the-counter clearinghouse until March 3, 2014 at the behest of foreign investment firms.
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IntercontinentalExchange and CME Group have both had trade repositories approved under the European Markets Infrastructure Regulation by the European Securities and Markets Authority, allowing them to start accepting clients ahead of mandatory trade reporting on Feb. 12, 2014.
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The U.S. Commodity Futures Trading Commission has issued a no-action letter providing relief to non-U.S. swap dealers from certain transaction-level requirements under the Commodity Exchange act.
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Retail structured product issuers in India are struggling with regulations in the country that have led to the minimum investment amount tripling, effectively shutting down the market.
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The Asia Pacific Regional Committee of the International Organization of Securities Commissions has written to Michel Barnier, European Commissioner for internal market and services in Brussels, warning that derivatives trading could dry up in Asia if central counterparties there are not granted a six-month extension to complete equivalence assessments that allow them to be recognized as qualifying CCPs under European Markets Infrastructure Regulation.
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The European Commission has published a legislative proposal for a regulation on financial benchmarks. The proposed Regulation aims to address concerns about the integrity and accuracy of benchmarks by regulating administrators of benchmarks, contributors to benchmarks and benchmark users. The Regulation will also prohibit the use in the E.U. of unauthorised benchmarks, including benchmarks prepared by unregistered non-E.U. administrators from non-equivalent jurisdictions.