regulation in market

8/13/2019 regulation in market

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APresentation

On

Market regulators

Name : Parth B. RavalEnrl : 117150592018


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The objectives of financial regulators are usually

market confidence to maintain confidence in the financial system

financial stability - contributing to the protection and enhancement of

stability of the financial system

Consumer protection - securing the appropriate degree of protection

for consumers.

Reduction of financial crime - reducing the extent to which it is

possible for a regulated business to be used for a purpose connected

with financial crime.


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Acts empowers organizations, government or non-government, to monitor

activities and enforce actions. There are various setups and combinations in

place for the financial regulatory structure around the global. Leaf parts are

in any case:

Superv is ion o f stock exchanges

Exchange acts ensure that trading on the exchanges is conducted in a

proper manner. Most prominent the pricing process, execution and

settlement of trades, direct and efficient trade monitoring


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Financial regulators ensure that listed companies and market participants

comply with various regulations under the trading acts. The trading acts

demands that listed companies publish regular financial reports, ad hoc

notifications or directors' dealings. Whereas market participants are required

to publish major shareholder notifications. The objective of monitoring

compliance by listed companies with their disclosure requirements is to

ensure that investors have access to essential and adequate information for

making an informed assessment of listed companies and their securities

Superv is ion o f l is ted companies


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Superv is ion of ant i -mo ney launder ingThe anti-money laundering supervision ensures that criminal activities do not

threaten the reputation and financial strength of an institution, or also endanger

the integrity and stability of the whole financial market. All companies concerned

need to have policies in place which prevents transactions with criminal

background

Superv is ion of investment m anagement

Asset management supervision or investment acts ensures the frictionless

operation of those vehicles


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Supervis ion o f banks and f inanc ial serv ices pro viders

Banking acts lays down rules for banks which they have to observe when they

are being established and when they are carrying on their business. These

rules are designed to prevent unwelcome developments that might disrupt the

smooth functioning of the banking system. Thus ensuring a strong and

efficient banking system


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Unique jur isd ic t ions

In most cases, financial regulatory authorities regulate all financial activities. But in

some cases, there are specific authorities to regulate each sector of the finance

industry, mainly banking, securities, insurance and pensions markets, but in some

cases also commodities, futures, forwards, etc. For example, in Australia,

the Australian Prudential Regulation Authority (APRA) supervises banks and

insurers, while the Australian Securities and Investments Commission (ASIC) isresponsible for enforcing financial services and corporations laws.

Sometimes more than one institution regulates and supervises the banking

market, normally because, apart from regulatory authorities, central banks also

regulate the banking industry. For example, in the USA banking is regulated by a

lot of regulators, such as the Federal Reserve System, the Federal Deposit

Insurance Corporation, the Office of the Comptroller of the Currency the National

Credit Union Administration, the Office of Thrift Supervision, as well as regulators

at the state level.


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Regulatory rel iance on credit rat ing agencies

Think-tanks such as the World Pensions Council (WPC) have argued that

most European governments pushed dogmatically for the adoption of

the Basel II recommendations, adopted in 2005, transposed in European

Union law through the Capital Requirements Directive (CRD), effective since

2008. In essence, they forced European banks, and, more importantly,

the European Central Bank itself e.g. when gauging the solvency of EU-based

financial institutions, to rely more than ever on the standardized assessments

of credit risk marketed by two private US agencies- Moodys and S&P, thus

using public policy and ultimately taxpayers money to strengthen an anti-

competitive duopolistic industry. Ironically, European governments have

abdicated a key component of their regulatory authority in favor of a non-

European, highly deregulated, private cartel


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The financial system in India is regulated by independent regulators

in the field of banking, insurance, capital market, commodities

market, and pension funds. However, Government of India plays a

significant role in controlling the financial system in India and

influences the roles of such regulators at least to some extent.

The following are five major financial regulatory bodies in India:-


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(A) Statutory Bodies via par l iamentary enactments:

Reserve Bank o f Ind ia: Reserve Bank of India is the apex monetary Institution

of India. It is also called as the central bank of the country.

The Reserve Bank of India was established on April 1, 1935 in accordance with

the provisions of the Reserve Bank of India Act, 1934. The Central Office of the

Reserve Bank was initially established in Calcutta but was permanently moved to

Mumbai in 1937. The Central Office is where the Governor sits and where

policies are formulated. Though originally privately owned, since nationalization

in 1949, the Reserve Bank is fully owned by the Government of India.


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It acts as the apex monetary authority of the country. The Central Office is where

the Governor sits and is where policies are formulated. Though originally privately

owned, since nationalization in 1949, the Reserve Bank is fully owned by the

Government of India. The preamble of the reserve bank of India is as follows:

"...to regulate the issue of Bank Notes and keeping of reserves with a view to

securing monetary stability in India and generally to operate the currency and credit

system of the country to its advantage.

Secu r i t ies and Exchange Board of India: SEBI Act, 1992 : Securities and

Exchange Board of India (SEBI) was first established in the year 1988 as a non-

statutory body for regulating the securities market. It became an autonomous body

in 1992 and more powers were given through an ordinance. Since then it

regulates the market through its independent power.


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Insurance Regulatory and Development Author i ty : The Insurance

Regulatory and Development Authority (IRDA) is a national agency of

the Government of India and is based in Hyderabad (Andhra Pradesh). It was

formed by an Act of Indian Parliament known as IRDA Act 1999, which was

amended in 2002 to incorporate some emerging requirements. Mission of IRDA as

stated in the act is "to protect the interests of the policyholders, to regulate,

promote and ensure orderly growth of the insurance industry and for matters

connected therewith or incidental thereto."


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(B) Part of th e Ministr ies of the Gov ernment of India :

Forward Market Comm ission India (FMC): Forward Markets Commission

(FMC) headquartered at Mumbai, is a regulatory authority which is overseen by

the Ministry of Consumer Affairs, Food and Public Distribution, Govt. of India. It is

a statutory body set up in 1953 under the Forward Contracts (Regulation) Act,1952 This Commission allows commodity trading in 22 exchanges in India, out of

which three are national level.

PFRDA under the Finance Minis try : Pension Fund Regulatory and

Development Authority : PFRDA was established by Government of India on23rd August, 2003. The Government has, through an executive order dated

10thOctober 2003, mandated PFRDA to act as a regulator for the pension sector.

The mandate of PFRDA is development and regulation of pension sector in India.


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REGULATORS-INDIA

Securities and Exchange Board of India

Reserve Bank of India

Ministry of Finance

Ministry of Corporate Affairs

Insurance Regulatory Authority of India

PFRDA


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MARKET REGULATORS WORLDWIDE

Asia

Capital Market Board (Turkey)

Securities Bureau of the Ministry of Finance (Japan)

Securities Commission (Malaysia)

Securities and Exchange Commission (Bangladesh)

Securities and Futures Commission (Hong Kong)

Securities and Exchange Commission of Pakistan


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Europe

BAWe - Bundesaufsichtsamt for den Wertpapierhandel (Germany)

Central Bank of Cyprus

CNMV - Comision Nacional del Mercado de Valores (Spain)

COB - Comission des Operations de Bourse (France)

CONSOB - Commissione Nazionale per le Societa e la Borsa (Italy)

Financial Services Department (Jersey)

Financial Services Authority (United Kingdom)

Australia

Australian Securities Commission

The New Zealand Securities Commission


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North America

British Columbia Securities Commission (Canada)

Canadian Grain Commission

CFTC - U.S. Commodity Futures Trading Commission

SEC - U.S. Securities& Exchange Commission


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Others

BID - Banco Interamericano de Desarollo

BIS - Bank for International Settlements

COSRA - Council of Securities Regulators of the Americas

FASB - Financial Accounting Standards Board

FIABV - Federacion Iberoamericana de Bolsas de Valores

FIBV - Federation Internationale des Bourses de Valeurs

ICI - Investment Company Institute

IFC - International Finance Corporation

World Bank

WTO - World Trade Organization

Association of National Numbering Agency

International Organization of Securities Commissions


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TH NKYOU

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