Trends of development of financial and legal basics for market self-regulation of investment securities

• Main Author: Pavel Sergeyevich Troekurov
• Format: Article
• Language: English
• Published: Peoples’ Friendship University of Russia (RUDN University) 2016-12-01
• Series: RUDN Journal of Law
• Subjects: рынок ценных бумаг; саморегулируемые организации; новации на рынке ценных бумаг
• Online Access: http://journals.rudn.ru/law/article/view/14797
• ISSN: 2313-2337; 2408-9001

The article investigates the activities of one of the most dynamically developing institutions - self-regulating organizations (SROs) in the investment securities market. The mechanism of the securities market regulation in the United States and the UK is analyzed and the differences between them are defined. There are two types of SROs in the securities market of the USA: with voluntary and compulsory membership. SROs do not only develop standards and rules, but also carry out functions that are similar to the licensing of professional activity in the stock market. It is shown that in the UK since 2001 the self-regulating status of organizations in the stock market in fact has been abolished, and they have survived only as professional associations. It is concluded that the system of regulation of the Russian stock market has borrowed a lot of decisions and principles of the legislation of the USA and the UK. It is substantiated that the reform of financial regulation in Russia has required the revision of the current legislation in the field of SROs in the financial market and the creating of a two-level mechanism for regulation (governmental and SRO’s). The key innovations for SROs in the securities market introduced by the Federal law from July 13, 2015 No. 223-FZ "On self-regulating organizations in the sphere of the financial market and on amendments to articles 2 and 6 of the Federal law "On amendments in separate legislative acts of the Russian Federation" are defined: the re-introduction of the principle of compulsory membership in the SRO, while maintaining the licensing of professional activities of these subjects along with compulsory member of the society in their SRO; the limitation on the number of SROs (merger of not less than 26% of the total number of financial institutions engaged in appropriate activities); determination of the requirement of a common core of standards for all SROs, uniting the subjects of similar activity; control functions delegation by the Bank of Russia to separate SROs defined by the Bank of Russia. It is concluded that in the result of the imposed changes to the Law on SROs the securities market should become transparent, coherent, effectively functioning and stable, complying with the rights and legitimate interests of retail investors and creating conditions for reducing risks of individual investments.