Regulation of the international securities market, the Organization...

Regulation of the international securities market

Global and International Securities Market Organizations

Developing and constantly changing stock market with its extreme forms of volatility requires a system of control over its functioning. Control functions of the state allow to reduce the influence of negative factors arising in the activity of the market itself and spreading its effect on other areas of the country's economy.

The main objectives of regulating the activities of the world's stock markets, as identified by the International Organization of Securities Commissions - IOSCO (International Organization of Securities Commissions), are:

• protection of investors;

• guarantee of fairness, efficiency and transparency in the market;

• reducing the level of systematic risk.

In the opinion of the IOSCO (contained in the document: "Principles and Objectives of Securities Regulation"), domestic laws that meet the requirements of effective regulation should include:

1) Companies Law:

- formation of the company;

- duties of directors and officers;

- regulation of mergers and other transactions that can influence changes in the management system;

- laws on control over the issue and offering of securities;

- disclosure of information to the holders of securities for the possibility of reasonable voting for election to the board of directors;

- disclosure of information about large shareholders;

2) commercial code (law on contracts):

- private law in contracts;

- the provision of securities on loan and the pledge;

- property rights, including rights to obtain rights and rules for regulating the transfer of these rights;

3) taxation laws: the presence of clarity and consistency, while not limiting the treatment of investment and investment products;

4) laws on bankruptcy and insolvency:

- the rights of shareholders in case of bankruptcy;

- the rights of clients with the insolvency of intermediaries;

- distribution of net income of the company in bankruptcy;

5) Competition Law:

- the prevention of anticompetitive methods;

- preventing unfair barriers to entry into the market;

- prevention of abuses associated with the dominant market position;

6) bank law:

- an honest and effective legal system (including an alternative arbitration system or other alternative conflict resolution mechanisms);

- execution of court decisions and arbitral awards, including decisions and decisions for non-residents;

7) Conflict Resolution System:

- an honest and effective legal system (including an alternative arbitration system or other alternative conflict resolution mechanisms);

- the possibility of enforcing judicial orders and arbitral awards in court;

8) the law on intermediaries.

The huge scale of speculative transactions in international financial markets adversely affects not only the economies of the countries involved in these operations, but, due to the current high level of internationalization, and to states and entire regions less than others related to their initiation. On the share of speculative transactions accounted for up to 90% of daily foreign exchange transactions.

One of the main unifying goals of the IOSCO is to coordinate efforts to establish standards and effectively oversee international transactions with securities.

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