International Organization of Securities Commissions

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International Organization of Securities Commissions
IOSCO.gif
Founded 1983
Headquarters Madrid, Spain
Key People David Wright, Secretary General
Products Trade organization
Website http://www.iosco.org/

The International Organization of Securities Commissions (IOSCO) was formed in 1983 as the international "standard setter" for securities markets. While it is without actual authority over its national regulator members, IOSCO has enunciated basic principles that should form the basis for financial market regulation globally. Despite the fact that it is inherently a consensus-seeking organization, IOSCO is currently contemplating whether implementation of IOSCO principles should be a condition for membership.[1] IOSCO's membership regulates more than 90 percent of the world's securities markets. In some circles, IOSCO is considered the world's most important international cooperative forum for securities regulatory agencies. IOSCO members regulate more than 100 jurisdictions.

Along with the Basel Committee on Banking Supervision and the International Association of Insurance Supervisors, it makes up the Joint Forum of International Financial Regulators.

Recent History

  • In September 2012, an IOSCO discussion paper revealed that fewer than half of the interest rates surveyed in the U.S., Europe and Asia were calculated by methods other than by actual transactions in the market. This lack of oversight was previously identified as having allowed traders to manipulate the London Interbank Offer Rate (LIBOR). IOSCO referred to such methodologies as "unclear, not transparent and only rarely subject to specific regulatory standards or obligations."[2] According to the report, up to 80 percent of interest rate benchmarks were compiled by either associations or private entities.
  • In April 2012, IOSCO, along with the Committee on Payment and Settlement Systems (CPSS) published a report on the principles for financial market infrastructures (FMIs). The report contains new and more demanding international standards for payment, clearing and settlement systems, including central counterparties.
  • On March 5, 2012, David Wright began his tenure as secretary-general.
  • In November 2010, IOSCO released a report to the Group of 20 Nations warning about the lack of information on the physical commodities markets. They believe information about these markets is critical for the financial functioning of these markets and for reliable price discovery. [4]
  • In March of 2009, IOSCO said improvements could be made to information available on commodity markets related to futures. In a release, IOSCO recommended that national financial regulators review powers.[5]
  • In May of 2008, Nick Sherry, Australia's Minister for Superannuation, met with Greg Tanzer, Secretary General of IOSCO. Sherry and Tanzer discussed issues being faced by market regulators, including the consequences of events in the U.S. subprime mortgage market; IOSCO's re-drafting of its Code of Conduct Fundamentals for credit rating agencies; and trends in the operation and regulation of securities markets.[7]
  • In November 2007, IOSCO published a consultation paper prepared by the technical committee in relation to private equity. The paper had two objectives. First to identify those issues generated by the activity of the private equity industry which potentially create risks that impact on IOSCO's objectives and principles. Second, having identified these relevant issues, it set out the next steps IOSCO proposed to take.[8]
  • In 2005 IOSCO endorsed the IOSCO MOU as the benchmark for international cooperation among securities regulators and set out strategic objectives to expand the network of IOSCO MOU signatories by 2010. IOSCO provides comprehensive technical assistance to its members, in particular those which regulate emerging securities markets.
  • In 2003 the organization endorsed a comprehensive methodology (IOSCO Principles Assessment Methodology) that enables an objective assessment of the level of implementation of the IOSCO Principles in the jurisdictions of its members and the development of practical action plans to correct deficiencies.
  • In 2002 IOSCO adopted a multilateral memorandum of understanding (IOSCO MOU) designed to facilitate cross-border enforcement and exchange of information among the international community of securities regulators.
  • In 1998, IOSCO adopted a comprehensive set of objectives and principles of securities regulation (IOSCO Principles).

Key People

References

  1. "NYSE Euronext Comment Letter - Nov. 26, 2007”. NYSE Euronext.
  2. Libor-Like Manipulation Possible in Other Benchmarks, Iosco Says. Bloomberg.
  3. Changing hats, March 2012. Risk.net.
  4. Regulators extend commodities push. FT.
  5. Regulators Need Better Commodity Information - IOSCO. Reuters.
  6. World Federation of Exchanges States Priorities for 2009. FinanceTech.
  7. International Financial Regulators' Approach To Tax Havens: Minister. Business Spectator.
  8. Private Equity: Final Report. CNBV.