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Iosco forms task force on OTC derivatives regulation

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The Technical Committee of the International Organization of Securities Commissions has formed a Task Force on OTC Derivatives Regulation.

It aims to coordinate securities and futures regulators’ efforts to work together in the development of supervisory and oversight structures related to over-the-counter derivatives markets.

Hans Hoogervorst, chairman of the Technical Committee, says: “Iosco has identified the need for enhanced international coordination between securities regulators in order to support the global reform efforts currently underway regarding OTC derivatives regulation.

“Many jurisdictions are currently adopting legislation that provides securities and futures regulators with an important role in the regulation of the OTC derivatives markets.  As regulators implement their new legislative mandates, close consultation with foreign counterparts and the development of consistent standards across jurisdictions with respect to OTC derivatives regulation could help to promote convergence among Iosco members’ and other regulatory bodies regulations, reduce the potential for conflicts of law or regulatory arbitrage, and mitigate systemic risk.”

The purpose of the Task Force is:

1.      To seek to develop consistent international standards related to OTC derivatives regulation in the areas of clearing, trading, trade data collection and reporting, and the oversight of certain market participants;

2.      To coordinate other international initiatives relating to OTC derivatives regulation, including addressing the recommendations by the OTC Derivatives Working Group for additional analysis of exchange and electronic platform trading as well as data reporting and aggregation requirements for OTC derivatives; and

3.      To serve as a centralised group within Iosco through which Iosco members can consult and coordinate generally on issues relating to OTC derivatives regulation.

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