AsianInvestor's regulatory roundup, Aug 6
France: OECD publishes global tax exchange framework
The Organisation of Economic Cooperation and Development (OECD) has published standards to govern how member countries share financial information on individuals.
The framework, released on July 21, could allow governments to exchange automatically account information collected by financial institutions on balances, interest, dividends and proceeds from the sale of financial assets. Entities such as trusts and foundations would be subject to the rules.
More than 65 countries have expressed interest in adopting the global standards, including China, Japan, Korea, India, Indonesia, Malaysia and Singapore.
The OECD has not indicated when the standards will be implemented.
Singapore: Regulator proposes benchmark rules
The Monetary Authority of Singapore (MAS) has released proposals to regulate financial benchmarks in the wake of cases of the manipulation of key rates.
The legislation includes the introduction of criminal liability and civil sanctions for anyone who manipulates the Singapore Interbank Offered Rate or the Swap Offered Rate.
MAS said it would consider extending legislation to cover other financial benchmarks based on systemic importance and vulnerability to manipulation.
Administrators and submitters of financial benchmarks would need to be licenced under the proposals.
The regulator, which also doubles as Singapore’s central bank, censured 20 banks in June for attempting to rig benchmark interest rates.
A consultation process for the proposals is due to end on August 29.
Hong Kong, Australia: Regulators turn up heat on dark pools
Hong Kong’s securities regulator has reportedly warned banks in the city they face greater scrutiny of their use of dark pools.
One of the Securities and Futures Commission’s concerns is the potential impact of high-frequency trading, which some say erodes market efficiency and integrity.
The warning comes as the US is probing several banks’ alternative trading venues, including the Barclays LX dark pool.
Several banks in Hong Kong are understood to be seeking legal advice following a confidential meeting convened by the SFC's supervisory department last month, during which the watchdog told firms it would step up scrutiny of dark pool marketing materials.
Separately, Australia’s securities regulator has said it will review the operations of dark pools following the introduction of rules governing their activities.
The rules, implemented by the Australian Securities and Investment Commission (Asic) in August last year, require dark-pool operators to publish information about their systems, such as the assets being traded.
Australia: Asic reviews enforcements
Australia’s securities regulator secured six criminal convictions in the first half of the year for misconduct including insider-trading and market manipulation, according to a new report.
In January, the Australian Securities and Investment Commission (Asic) censured BNP Paribas after it found the bank’s traders had attempted to influence the country’s benchmark interest rate.
Asic accepted a binding agreement with BNP Paribas in January that requires the French bank to ensure its participation in the setting of Australian interest-rate benchmarks upholds the integrity and reliability of those benchmarks.
BNP also made a contribution of A$1 million ($875,000) to fund independent financial literacy projects in Australia.
In other cases, the Federal Court of Australia imposed a fine of A$1.2 million against Newcrest Mining for selectively briefing analysts on market-sensitive information ahead of it being disclosed to the market.
Also, Russell Johnson, a former director of Sonray Capital Markets, was sentenced this April to six-and-a-half years in jail for his role in the collapse of the firm, which folded owing more than A$46 million.
Asic commissioner Greg Tanzer noted that the regulator had focused on the treatment of confidential information by listed companies, manipulation of financial benchmarks and improving auditor and liquidator standards.
Other regulation-related stories published on AsianInvestor.net recently:
Asia may follow SGX in short position reporting rule
Australia urged to make key ARFP changes