Self-regulatory organization of professional market participants
The problems of financial market infrastructure more efficiently solved by the market participants, independently and at their own expense. Primarily through the institution of self-regulatory organizations, associations, and other associations. Organizations such as international experience, can successfully take on the role of monitoring compliance with the rules of the game in the financial services without overstaffing government regulatory bodies. This will save the state money and move to control costs on stakeholders to the private market.
Self-regulatory organization - is a voluntary association of professional market participants, not intended for profit, created to protect the interests of its members and the interests of other market participants and registered by the authorized body.
The main purpose of self-regulation in the stock market of Ukraine is to ensure optimization of state regulation of the stock market through deregulation and increased monitoring for compliance with the regulatory requirements of the stock market and the establishment of uniform methods of regulation.
The main directions of development of self-regulation:
• increasing the effectiveness of self-regulation in the stock market by expanding the powers and functions of self-regulatory organizations;
• Provision of doing business by members of self-regulatory organizations;
• monitoring and supervision of the activities of the members of self-regulatory organizations;
• protection of the rights and legitimate interests of members, customers, members of the self-regulatory organizations, professional participants of the securities market;
• formalization and optimization requirements for self-regulatory organizations, enhance their responsibility for the performance of their duties;
• Increase financial and technical requirements for self-regulatory organizations, which have assumed the powers of control and supervision over observance of members of the legislative and regulatory requirements, the authorized state bodies of the control and supervision of the activities of self-regulatory organizations.
Self-regulatory organization is established and operates in accordance with the following principles:
• self-regulatory organization - an association of professional participants of the securities market, which is created under the current legislation, the principle - one self-regulatory organization for each profession;
• professional securities market participant must be a member of at least one self-regulatory organization;
• in accordance with the applicable laws of combining respect of professional activities in the securities market professional participant can be a member of several self-regulatory organizations;
• association of professional securities market participants registered by the State Commission on Securities and Stock Market and gets the status of the self-regulatory organization after making a record of it in the public register maintained by the State Commission on Securities and Stock Market;
• self-regulatory organization consists of at least 25% of the professional participants of the securities market, offering a certain type (s) of professional activity, except for self-regulatory organizations, organizers of trade and institutions engaged in the settlement and clearing activities;
• implementation of the management of the self-regulatory organization for democratic principles (one member of the self-regulatory organization - one vote), provided equal rights and duties for all members;
• openness and availability of information on the activities of the organization to all its members;
• prevent unfair competition in the securities market;
• a combination of interests of members of self-regulatory organizations and their customers while increasing responsibility for their compliance with regulatory requirements.
The main tasks of self-regulatory organizations:
• the establishment of rules, standards, and requirements for the implementation of activities with securities regulations and rules of professional qualification requirements of experts - members of self-regulatory organizations and the monitoring of their implementation by Member States. Rules, standards, and requirements for professional activity, take effect upon approval by the State Commission on Securities and Stock Market;
• Promotion of doing business members of the self-regulatory organization;
• Development and implementation of measures to protect the rights of members of the self-regulatory organization;
• Review of customer complaints - the members of self-regulatory organizations, within them, a violation of professional participants of the securities required by applicable law;
• the introduction of effective mechanisms for resolving disputes between members of the self-regulatory organization and among members of the self-regulatory organizations and their clients;
• initiating improvement of normative and legal framework of the securities market;
• representation of the members of the self-regulatory organizations and other market participants in government agencies, courts, and other organizations in order to protect their interests;
• impose sanctions and applies sanctions on members who violate any applicable laws, regulations, statutes and by-laws of self-regulatory organizations;
• inform the State Commission on Securities and Stock Market of identified violations of the current legislation on the part of its members and clients;
• apply to the court on his own behalf or on behalf of its members for the protection of clients' rights of members of self-regulatory organizations, or the rights of members who have suffered loss or harm customers or unfair actions by public bodies in the exercise of professional activity on the stock market;
• Provide public authorities proposals for improving the legislation of Ukraine, as well as analyzes the practice of implementation of the current legislation of Ukraine.
As required by law, or in the case of delegation of public authorities responsible for regulation of the stock market authority, self-regulatory organization may carry out:
• the collection, compilation and analysis of information processing professional activity on the stock market in compliance with applicable law to collect, use, dissemination and storage of information with restricted access and information that could harm the self-regulatory organization, its members and participants of the securities market;
• Submission of applications for licenses by persons who carry out professional activity in the securities market, as well as the submission of appeals to cancel the license for professional activity in the securities of those members of the self-regulatory organization that violates the requirements of current legislation;
• certification of specialists in the securities market in accordance with the direction of the self-regulatory organization, or withdraw the submission to the state authorities to abolish the certification by professionals in the securities market, which always violate the law.
Regulatory organization in accordance with its tasks:
• sets out the rules, standards and requirements for the implementation of activities of members of the self-regulatory organization that would protect the interests of investors, and were aimed at preventing crime. The level of the requirements set out in regulations and standards, should not be lower than the requirements of the applicable laws, regulations and other documents of the bodies exercising state regulation and control of the self-regulatory organizations;
• continuous monitoring of compliance with self-regulatory organizations, members of the rules, standards, and requirements established by the self-regulatory organization;
• consistent, members of the self-regulatory organization in line with the objectives defined by legislation, regulations and rules of the Commission's self-regulatory organization, which ensures that the members of the Internal Control Self-Regulatory Organizations;
• promoting regulatory agencies to monitor the capital market;
• in accordance with the qualification requirements of developing training programs and plans that determine host institution, and the training and retraining of managers and experts of institutions engaged in professional activities in the stock market, and agreements with them.
Transition requirements to create a self-regulatory organization for each type of professional activity related to the need for uniformity in the rules of certain professional activities in the securities market, gain control of the compliance to the regulatory requirements of the stock market, prevent fictitious membership, non-competition standards, increased openness of self-regulation.
The legal status of Ukrainian SRO today is detailed in the Regulation on the self-regulatory organization of the securities market, the Securities Commission approved the Order № 329 dated 23.12.1996 was, in turn, self-regulatory organization as a structure found its definition in several regulations, in particular the Law of Ukraine "On Securities paper and the stock market "," On State Regulation of Securities Market in Ukraine "and" On Financial Services and State Regulation of Financial Markets. "
Each of these documents in many ways defines the SRO. The difference is that the latter involves delegating CPO powers to develop and implement rules of conduct in the financial services markets, and / or Certification of financial services. Their power will yield the relevant authorities in charge of regulation of financial services markets. This situation does not accidentally appeared in the legislation of Ukraine - it has long been used in other countries.
The story of the first self-regulatory organization in the world is subsidized by the year 1934. That's when the U.S. embraced the economic crisis, one of the measures to overcome in the creation of the Securities and Exchange Commission (KTSPB), which should serve as the supervision of the execution of the federal securities laws. A significant part of its powers the Commission is soon passed several non-governmental structures, known as "self-regulatory organization." Most of them, and today is the National Association of Securities Dealers. Under U.S. law, every dealer and broker must not only register KTSPB, but to become a member of NASDA.
Thus, the provisions on the mandatory entry into SROs and the need to transfer the relevant state bodies of authority to self-regulatory organizations, tested in practice and proved its worth.
Their credentials, SRO, in their circle of American organizations is much broader than the Ukrainian. So, for them, in particular, the regulation of the responsibility of its members on the issue of bonds, the examinations for the right to engage in professional activities and registration of professionals, regulation of advertising and publishing, inspection companies specializing in the sale of securities. However, restrictions on the number of SROs, U.S. law does not.
Thus, this project will contribute to the unified state policy on the stock market order and discipline of its members. This will strengthen the monitoring of compliance to the regulatory requirements of the market, increasing the requirements for members of the self-regulatory organizations, which, in turn, will help to protect the legitimate rights and interests of investors.
Achieving these objectives should result in a qualitative improvement of the investment climate in Ukraine.