Alert December 02, 2008

IOSCO Launches Task Forces on Short Sales, Unregulated Financial Markets and Products and Unregulated Financial Entities

The International Organization of Securities Commissions Technical Committee launched three task forces to consider the following issues:

  • Short Sales — this Task Force will work to eliminate gaps in various regulatory approaches to naked short selling, including delivery requirements and disclosure of short positions.  It will also examine how to minimize adverse impacts on legitimate securities lending, hedging and other types of transactions that are critical to capital formation and to reducing market volatility.  The Task Force will be chaired by the Securities and Futures Commission of Hong Kong. 
  • Unregulated Financial Markets and Products — this Task Force will examine ways to introduce greater transparency and oversight to unregulated market segments, such as OTC markets for derivatives and other structured financial products.  It will be co-chaired by the Australian Securities and Investments Commission and the Autorité de Marché Financiers of France. 
  • Unregulated Financial Entities — this Task Force will examine issues surrounding unregulated entities such as hedge funds, including the development of recommended regulatory approaches to mitigate risks associated with their trading and traditional opacity.  It will be chaired by the CONSOB of Italy and the Financial Services Authority of the United Kingdom.

The Task Forces will present their reports at the next Technical Committee meeting in February 2009 and to the next G-20 summit in spring 2009.