Global Market Policies

Digital Finance Monthly Update for June 2023.

Digital Finance Monthly Update for May 2023.

GFMA with BCG, Clifford Chance, and Cravath, Swaine & Moore LLP published a report on the impact of distributed ledger technology (DLT) in global capital markets.

Digital Finance Monthly Update for April 2023.

Digital Finance Monthly Update for March 2023.

GFMA's second GFXD “Next Step FX” Diversity, Equity and Inclusion event, again showcased the Foreign Exchange market - focusing on its evolution and future developments and how this is creating opportunities for a rewarding career in FX. The event covered the transformation of the FX market and highlighted the mid-to long-term industry trends and how they are driving new opportunities for FX careers in areas such as sales, trading, operations, analytics, technology, and digital currencies.

Digital Finance Monthly Update for February 2023.

IBOR Transition Monthly Update for September 2022 - January 2023.

Digital Finance Monthly Update for January 2023.

Digital Finance Monthly Update for December 2022.

Digital Finance Monthly Update for November 2022.

Digital Finance Monthly Update for October 2022.

Digital Finance Monthly Update for September 2022.

Digital Finance Monthly Update for August 2022.

Digital Finance Monthly Update for July 2022.

GFMA developed a set of proposed principles regarding critical third parties.

Digital Finance Monthly Update for June 2022.

New GFMA Paper by BCG and Clifford Chance Outlines Benefits and Challenges of Wholesale Central Bank Digital Currencies

GFMA, IIF, and ISDA Publish Whitepaper on Capitalization of Equity Investments in Funds Under the FRTB

GFMA has published 'Considerations for Developing Central Bank Digital Currencies (CBDCs).'

GFMA and BCG publish Global Principles for Developing Climate Finance Taxonomies.

To aid in the awareness of the IBOR transition process impacting globally-active financial market participants, the Global Financial Markets Association (GFMA) has developed the following document outlining the various parts and players.  This version of the document has been updated from its previous June 2020 version to provide the latest information regarding transition objectives for major currencies, including the Australian dollar, Canadian dollar, Euro, Hong Kong dollar, Japanese yen, Singapore dollar, Swiss franc, UK pound sterling, and U.S. dollar.

The Global Financial Markets Association (GFMA) and Boston Consulting Group (BCG) published a global report outlining the market-wide and sector-specific recommendations necessary to accelerate investment in climate finance.

To aid in the awareness of the IBOR transition processes impacting globally-active financial institutions, the Global Financial Markets Association (GFMA) has created the following documents outlining the various parts and players. This version of the documents has been updated from its previous September 2019 version to provide the latest information regarding rates for major currencies including the Australian dollar, Canadian dollar, Euro, Hong Kong dollar, Japanese yen, Singapore dollar, Swiss franc, UK pound sterling and U.S. dollar.

SIFMA’s Business Continuity Planning team continues to closely monitor the novel coronavirus (COVID-19) and its impact on our industry and the markets. The SIFMA BCP and COVID-19 page provides guidance and resources for the industry to maintain operational resiliency, including instructions for financial services sector essential critical infrastructure workers.

The Securities Financing Transaction Regulation (SFTR) entered into force on 11 April 2019, with a phased-in compliance period. Compliance with the regulation requires that reporting firms provide their own LEIs as well as the LEIs of their counterparties. This document explains the requirement and the firms impacted.

This document provides answers to commonly asked questions regarding the LEI. Several regulators around the world require or are anticipated to require LEIs for transaction reporting and for other uses where clear identification of market participants is needed. Obtaining an LEI is a straightforward and efficient process.

These FAQs have been prepared based on a GFMA LEI Webinar at which members of ESMA participated. The answers have not been reviewed or confirmed by representatives of ESMA and are not official legal or regulatory guidance. Firms should rely on independent legal and regulatory sources to plan their LEI programs, including compliance with the requirements of MiFID II and EMIR.

This Trading Venue (TV) outreach will be to discuss operational challenges arising from FX Trading Venues’ Brexit planning and to share feedback on Trading Venues/banks needs and expectations in the planning process.

This Trading Venue (TV) outreach will be to discuss operational challenges arising from FX Trading Venues’ Brexit planning and share information on Trading Venues/banks needs and expectations in the planning process.

GFXD recommendations for the promotion of interoperability between new technologies and service providers.

To mark the launch of the FX Global Code, the GFMA Global FX Division, in conjunction with the Investment Association, the ACI and a number of other trade bodies, hosted an evening panel session with some of the key figures behind the development of the Code. Highlights from the 25 May 2017 event can be found below. 

The Global Foreign Exchange Division (GFXD) of the Global Financial Markets Association (GFMA) will be hosting two vendor outreach sessions of its Market Architecture Group and MiFID Working Group to discuss issues related to the implementation of MiFID.

The Global Foreign Exchange Division (GFXD) of the Global Financial Markets Association (GFMA) will be hosting a vendor outreach of its Market Architecture Group and MiFID Working Group to discuss issues related to the implementation of MiFID.

The MAG will start a new series of regular monthly industry outreach sessions, commencing in September 2014.

Statement by DTCC SWIFT on Plans for the launch of the CICI Utility

James Kemp, Managing Director of GFMA’s Global FX Division, provides a regulatory outlook for 2012 for FX Week.

This webinar outlined global regulatory developments, the creation of the LEI standard, and the implementation of LEI infrastructure.  

GFMA submitted a response to the FSB consultative document on "Enhancing Third-Party Risk Management and Oversight."

GFMA submitted a response to the IOSCO Crypto and Digital Assets Recommendations consult.

GFMA submitted a letter to leaders at the SEC, UK Treasury and European Commission to work together on the MiFID II Unbundling Requirement.

GFMA submitted responses to the IOSCO consultation reports on compliance carbon markets and on voluntary carbon markets.

GFMA submitted a response to the FSB's consult on Achieving Greater Convergence in Cyber Incident Reporting

GFMA submitted a response to the FSB's consult on the "International Regulation of Crypto-Asset Activities - a Proposed Framework."

GFMA joined a joint trade association response to the second BCBS consult on the "Prudential Treatment of Cryptoasset Exposures."

IBOR Transition Monthly Update for August 2022.

IBOR Transition Monthly Update for June - July 2022.

GFMA and BPI provided comments on the ISSB Exposure Drafts of IFRS S1 and IFRS S2.

GFMA, IIF, and ISDA submitted a joint response to the FSB on their Interim Report on Supervisory and Regulatory Approaches to Climate-Related Risks.

IBOR Transition Monthly Update for May 2022.

IBOR Transition Monthly Update for April 2022.

GFMA with IIF and ISDA submitted a letter to the BCBS on SA-CCR.

IBOR Transition Monthly Update for March 2022.

GFMA, IIF, and BPI have submitted a joint response to the IOSCO Consultation Report on Operational Resilience of Trading Venues and Market Intermediaries During the COVID-19 Pandemic.

IBOR Transition Monthly Update for February 2022.

GFMA and ISDA submitted a response to the BCBS Consultative Document on Principles for the effective management and supervision of climate-related financial risks.

GFMA, ASIFMA, BPI, and IIF submit a joint response to the HKMA Consultation on Operational Resilience, Operational Risk Management, and Business Continuity Planning

IBOR Transition Monthly Update for January 2022.

GFMA submitted a response to the International Platform for Sustainable Finance’s (IPSF) Consultation on Common Ground Taxonomy (CGT).

IBOR Transition Monthly Update for October - December 2021.

IBOR Transition Monthly Update for September 2021.

GFMA joined a joint trade association response to the BCBS consultative document on the "Prudential Treatment of Cryptoasset Exposures."

GFMA submitted a response to IOSCO's request for public comment on ESG ratings and data product providers.

IBOR Transition Monthly Update for June - August 2021

IBOR Transition Monthly Update for May 2021

IBOR Transition Monthly Update for March-April 2021

GFMA submitted a response to the Basel Committee's proposed Technical Amendment to the Minimum Haircut Floors for Securities Financing Transactions ("Minimum Haircut Framework").

IBOR Transition Monthly Update for February 2021

GFMA and ICSA submitted a joint response to IOSCO's consultation on "Market Data in the Secondary Equity Markets."

IBOR Transition Monthly Update for January 2021

The Global Financial Markets Association (GFMA) and Institute of International Finance (IIF) have published a joint paper – “2021 Priorities for Strengthening Global Operational Resilience Maturity in Financial Services” – that sets out how to continuously improve and strengthen the level of operational resilience in the financial system for the benefit of customers, markets, and the broader economy in countries across the world.  

GFMA submitted comments on the FSB's consultation on Outsourcing and Third-Party Relationships.

GFMA submits response to the IFRS Foundation Consultation Paper on Sustainability Reporting.

This Framework is designed to create an agreed upon approach for regulators and financial services firms to conduct effective testing to satisfy both supervisory and firm originated requirements.

GFMA and FIA submitted joint comments to the National People's Congress ("NPC") of the People's Republic of China regarding the Personal Information Protection Law ("PIPL").

GFMA and IIF have submitted a joint response letter to the BCBS supporting the draft principles put forward in their Consultative Document “Principles for operational resilience.”

GFMA and IIF submitted a joint response letter to the Basel Committee on Banking Supervision’s (BCBS) Consultative Document “Revisions to the principles for the sound management of operational risk.” 

IBOR Transition Monthly Update for October 2020

GFMA submits response to the IOSCO Consultation Report on the Use of Artificial Intelligence and Machine Learning by Market Intermediaries and Asset Managers.

GFMA and IIF submit a joint response to the UK's consultations on operational resilience.

IBOR Transition Monthly Update for September 2020

GFMA submits response to the FSB's Consultation Paper on Evaluation of the Effects of Too-Big-to-Fail Reforms

GFMA submits response to IOSCO's Consultation on Principles on Outsourcing

GFMA submits response to MEITY India Non Personal Data Framework consultation.

IBOR Transition Monthly Update for July - August 2020.

GFMA as part of a joint industry letter provides comments to the Office of the Comptroller of the Currency, Federal Housing Finance Agency, Federal Reserve, Farm Credit Administration and Federal Deposit Insurance Corporation regarding proposed rules extending the Phase 5 and 6 compliance dates for regulatory initial margin.

GFMA with IACPM, IIF, and SFA submitted a joint industry response to a BCBS Technical Amendment on Capital Treatment of Securitisations of Non-Performing Loans.

GFMA as part of a joint industry letter provides comments to the Commodity Futures Trading Commission (CFTC) on Margin Requirements for Uncleared Swaps for Swap Dealers and Major Swap Participants

GFMA submitted a response to the FSB consultation paper on “Addressing the regulatory, supervisory and oversight challenges raised by 'global stablecoin' arrangements.”

IBOR Transition Monthly Update for May - June 2020.

GFMA submitted a response to the BCBS discussion paper on “Designing a Prudential Treatment for Crypto-Assets.”

IBOR Transition Monthly Update for April 2020.

GFMA along with its affiliate member trades, AFME, ASIFMA, and SIFMA, as well as with other industry associations, provided comments to the Basel Committee on Banking Supervision (BCBS) and the International Organization of Securities Commissions (IOSCO) to request suspension of the current phase-in timeline due to the impacts of COVID-19.

GFMA and its Affiliate Members, AFME, ASIFMA and SIFMA, are actively monitoring global and regional developments relating to Coronavirus (COVID-19).

IBOR Transition Monthly Update for March 2020.

IBOR Transition Monthly Update for January 2020.

IBOR Transition Monthly Update for December 2019.

IBOR Transition Monthly Update for November 2019.

IBOR Transition Monthly Update for October 2019.

IBOR Transition Monthly Update for September 2019.

IBOR Transition Monthly Update for August 2019.

IBOR Transition Monthly Update for July 2019.

IBOR Transition Monthly Update for June 2019.

GFMA in partnership with ISDA developed a response to the Legal Entity Identifier (LEI) Regulatory Oversight Council (ROC) with industry feedback to the consultative document on LEI Eligibility for General Government Entities.

The Global Financial Markets Association (GFMA) and the Institute of International Finance (IIF) have released together “Discussion Draft Principles Supporting the Strengthening of Operational Resilience Maturity in Financial Services.” These principles support the financial industry’s efforts to continuously improve and strengthen the level of operational resilience for the firms, the customers, markets, the sector, and the broader economies they support nationally and across the globe.

30 September – To aid in the awareness of the IBOR transition processes impacting globally-active financial institutions, the Global Financial Markets Association (GFMA) has created the following documents outlining the various parts and players. This version of the documents has been updated from its previous April 2019 version to include rates for the Australian dollar, Canadian dollar, Hong Kong dollar and Singapore dollar in addition to currencies included in the initial documents (Japanese yen, Euro, UK pound sterling, U.S. dollar and Swiss Franc). This information is organized into the enclosed three products: 1. Key Timelines and Milestones for the Japanese yen, Euro, UK pound sterling, U.S. dollar, Swiss franc, Australian dollar, Canadian dollar, Hong Kong dollar and Singapore dollar; 2. Snapshot of the IBOR and RFR variables associated with each currency; 3. ‘At a Glance’ Tracker of each official sector working group activities and near-term expected actions.

GFMA's Commodities Working Group and Global Foreign Exchange Division, ISDA, UK Finance and EVIA responded jointly to the HMRC and HM Treasury technical consultation on the UK digital services tax.

GFMA submitted feedback to the the European Commission's Technical Expert Group's June report on a sustainable finance taxonomy for the European Union.

GFMA FX Division Submits Letter to EC on Intragroup Margin Exemption Under EMIR

GFMA FX Division Submits Letter to APRA on Uncleared Margin Amendments in Australia

GFMA submitted a response letter to the Cyberspace Administration of China on its "Measures for Security Assessment of Personal Information Outbound Transfer." The letter seeks clarification on application and suggests amendments to the measures.

GFMA FX Division Submits Letter to the MAS on Basel III Reforms in Singapore

GFMA's Commodities Working Group, ISDA and the FIA responded jointly to the European Securities and Markets Authority's call for evidence on position limits under MiFID II.

GFMA has published the results of a survey of global financial institutions' sustainable finance strategies and activities. The survey, conducted in May and June of 2019, is based on the anonymized and aggregated responses of 22 of the largest globally active financial and capital market participants. The findings of this survey will be helpful to institutions to benchmark against their peers and also to help inform future policymaking.

GFMA submitted two letters to the Cyberspace Administration of China on its "Measures on Data Security" and  "Measures on Cybersecurity Review." The letters seek clarification on application and suggest amendments to the measures.

GFMA submitted a response letter to the FSB in regarding its consultation on evaluation of too-big-to-fail (TBTF) reforms for banks. The response outlined key achievements in addressing TBTF, the areas that warrant further analysis and the other questions that should be asked in order to complete the evaluation.

GFMA FX Division Signs Joint Association Letter to US Regulators on Final Phase of Initial Margin Phase-In

GFXD submitted a response to South Africa's Financial Sector Conduct Authority and Prudential Authority on margin requirements for non-centrally cleared OTC derivative transactions.

GFMA, ISDA and the IIF sent a joint letter to the Basel Committee outlining concerns on the impact of the revised Credit Valuation Adjustment (CVA) Framework. The letter notes that industry QIS indicated that the framework will result in substantial increases in capital requirements.

8 April - To aid in the awareness of the IBOR transition processes impacting globally-active financial institutions, the Global Financial Markets Association (GFMA) has created the following documents outlining the various parts and players. This information is organized into the enclosed three products: 1. Key Timelines and Milestones for the Japanese yen, Euro, UK pound sterling, U.S. dollar, and the Swiss franc; 2. Snapshot of the IBOR and RFR variables associated with each currency; 3. ‘At a Glance’ Tracker of each official sector working group activities and near-term expected actions.

GFMA FX Division Signs Joint Association Letter to BCBS-IOSCO on Final Phase of Initial Margin Phase-In

ISDA/FIA/GFMA CWG General Comment to the European Commission’s Consultation on the International Role of the Euro in the Field of Energy 

GFXD submits comments to the European Commission on its consultation paper on the euro and market liquidity in foreign exchange markets.

GFMA and its constituent bodies AFME, ASIFMA and SIFMA support an open and resilient global economy in which financial services can boost international trade and investment, and global economic growth while protecting individuals’ rights to privacy. With the rise of the digital economy, policymakers around the world have rightly strengthened their policies that protect data and privacy, while continuing to enable cross-border trade that contributes to global economic growth.

The Global Financial Markets Association (GFMA) and PwC have published a report on current trends in technology and innovation and their impact on the investment bank of the future. The report, entitled ‘Technology and Innovation in Global Capital Markets,’ examines the key trends which are expected to impact the industry over the next five years, providing a vision for the future and identifying the implications for the industry and for future policymaking.  

GFMA FX Division Submits Comments to the US Agencies on their Notice of Proposed Rulemaking on 'Standardized Approach for Calculating the Exposure Amount of Derivative Contracts'

GFXD Submits Comments to the CFTC on its SEF Rules Proposal

GFMA FX Division and other Associations Submit Comments to the German Ministry of Finance on MiFID II/R

GFXD Submits Comments to the OSC on its Burden Reduction Notice

GFMA has released its Financial Data Handling Principles for Banks and Non-Banks as a voluntary set of principles drawn from international best practices. The principles are based on both the U.S. NIST Cybersecurity Framework and the European Union’s General Data Protection Regulation (GDPR).

GFMA, the International Swaps and Derivatives Association (ISDA) the Institute of International Finance (IIF) submitted a join response to the Basel Committee on Banking Supervision’s consultation on the leverage ratio treatment of client cleared derivatives. The industry believes that in the context of a bank exposure created by a client cleared derivative transaction, the leverage ratio framework should recognize the exposure-reducing effect of initial margin, particularly as it is not used to increase the bank’s leverage.

GFMA FX Division Submits Comments to the BCBS on its Consultative Document “Leverage ratio treatment of client cleared derivatives”

New Financial has published a new report, commissioned by the Global Financial Markets Association (GFMA), entitled “The New Financial Global Capital Markets Growth Index.” The purpose of the report is to provide an in-depth review and comparison of national and regional capital markets across the globe in terms of market size, depth, and access to pools of capital. GFMA commissioned New Financial to prepare the report to underscore the role markets can play in supporting sustainable economic growth around the world by diversifying the sources of available funding for companies, improving productivity through more efficient capital allocation and better risk management, increasing the capacity of economies to absorb economic shocks, and funding more sustainable pension systems. The report also identifies challenges and provides recommendations for jurisdictions to develop and expand capital markets as a source of funding and investment.

GFMA FX Division Submits Comments to KRX on its Trade Information Reporting System

GFMA FX Division Submits Comments to the CFTC, FDIC, Federal Reserve Board, OCC and SEC on their proposed changes to the Volcker Rule; Proposed Revisions to Prohibitions and Restrictions on Proprietary Trading and Certain Interests in, and Relationships with, Hedge Funds and Private Equity Funds.

GFMA response to the Global Financial Innovation Network consultation document on a “Global Financial Innovation Network”

GFMA and the International Swaps and Derivatives Association, Inc. (ISDA) provide joint comments in response to the Financial Stability Board (FSB) with industry input related to the FSB Thematic Peer Review (Peer Review) on Implementation of the Legal Entity Identifier (LEI).

GFMA FX Division Submits Comments to CPMI-IOSCO on its Consultation on Governance of Critical Data Elements.

GFMA's Global Foreign Exchange Division (GFXD) along with SIFMA, the International Swaps and Derivatives Association (ISDA), the American Bankers Association (ABA), and the Institute of International Bankers (IIB) provided comments to the Basel Committee on Bank Supervision and International Organization of Securities Commissions on Margin Requirements for Non-Centrally Cleared Derivatives – Final Stages of Initial Margin Phase-In.

GFMA response to the Financial Stability Board consultation document on a “Cyber Lexicon.”

GFMA response to the Financial Stability Board (FSB) Consultative Document on a Cyber Lexicon.

GFMA FX Division Submits Comments to the FSB, BCBS, CPMI and IOSCO on their consultation on Incentives to Centrally Clear Over-the-Counter (OTC) Derivatives

GFMA, FIA, and the Institute of International Finance (IIF), respond to the FSB consultative report of the Derivatives Assessment Team (DAT) on “Incentives to centrally clear over-the-counter (OTC) derivatives” (DAT Report).

Joint FIA, GFMA and LBMA response to the IOSCO Consultation Report on Commodity Storage and Delivery: Good or Sound Practices 

GFMA submitted a response to the Basel Committee's  finalization of revisions to the Globally Systemically Important Bank: Revised Assessment Methodology and the Higher Loss Absorbency Requirement.

Updated GFMA Penetration Testing White Paper, “A Win-Win Approach to Regulator-Guided, Firm-Led, Safe, Secure and Scalable Penetration Testing,” Related: GFMA Publishes Cybersecurity Penetration Testing Framework - 3 April 2018

GFMA and IIF Response to FSB Consultation on Impact of Reforms on Infrastructure Finance, August 30

GFMA FX Division Submits Comments to Hong Kong SFC on its Consultation on Margin Requirements for Non-centrally Cleared OTC Derivatives

GFMA, Bank Policy Institute (BPI), and the Institute of International Finance (IIF) provide this joint trades letter in response to the request of the Financial Stability Board (FSB) to submit views on the technical implementation of the FSB’s standard on the adequacy of total loss-absorbing and recapitalization capacity for Global Systemically Important Banks (G-SIBs) in resolution the Total Loss-Absorbing Capacity (TLAC) standard.

GFMA FX Division, ISDA and AFMA Submit Comments to ASIC on the Exemptions found in ASIC Corporations (Derivative Transaction Reporting Exemption) Instrument 2015/844 

GFMA FX Division, ISDA and ASIFMA Submit Comments to Korean FSC on the Draft Bill for Introduction of Regulatory Framework for Financial Benchmarks 

GFMA and IIF provide comments responding to FSB’s Thematic Peer Review on Bank Resolution Planning.

GFMA, the International Swaps and Derivatives Association and the Institute of International Finance provide comments on the latest Basel Committee on Banking Supervision (BCBS) consultation paper (CP) on the Fundamental Review of the Trading Book (FRTB). 

GFMA provides comments to the Hong Kong Monetary Authority and Securities and Futures Commission supporting their proposal to mandate the use of the Legal Entity Identifier (LEI) for certain reporting obligations.

GFMA FX Division and ISDA Submit Comments to the FSB on its Second Consultation on Governance Arrangements for the Unique Product Identifier  

GFMA published Principles for Achieving Consistent Regulatory Regimes and Supervisory Practices.

2018 marks ten years on from the Group of 20 (G20) response to the global financial crisis that ushered in financial regulatory reforms that have transformed global capital markets and enhanced financial stability.  To improve regulatory outcomes and deliver on the benefit of reforms, GFMA calls on global financial regulators to agree to principles to design regulatory cooperation arrangement(s) to develop consistent regulatory regimes and supervisory practices.  GFMA encourages global policymakers to establish regulatory cooperation arrangement(s) that (are): (i) Forward-looking; (ii) Enhance cross-border investment and market integrity; (iii) Supportive of similar outcomes; (iv) Predictable; (v) Transparent; (vi) Evidence-based; (vii) Proportionate; (viii) Enhance market certainty; (ix) Strengthen supervisory coordination; and (x) Supportive of conflict mitigation. 

“Now is the time for global financial regulators to design and adopt regulatory cooperation arrangements to deliver consistent regulatory regimes and supervisory practices to strengthen the foundation for strong, sustained and balanced growth leading to global job creation,” said Mark Austen, chief executive officer of GFMA and chief executive officer of ASIFMA.  “These principles aim to balance the legitimate national interests of domestic regulators and supervisors with a genuine commitment to the global common good of a safe, open and competitive global market, which has been a hallmark of the G20 reform agenda. We encourage global policymakers to adopt these principles for regulatory cooperation arrangements, which we believe will improve long-term market integrity, efficiency, liquidity, and resilience by minimizing the risk of fragmentation and the adverse effect it has on global economic growth.” 

See Full Press Release and Press Contacts here.

GFMA published Guiding Principles for Market Transparency.

Increasingly, regulators are developing public transparency requirements across markets and jurisdictions, which highlights differing policy objectives for rules and the need for shared global principles. Market transparency requirements should support specific policy objectives, consider the fundamental structural differences between markets and among asset classes, and provide meaningful and useful information to market participants while doing no harm to market integrity, liquidity, efficiency and resilience.  Fundamental structural differences between markets, including participants and their needs, preclude a “one-size-fits-all” approach. 

GFMA encourages policymakers and regulators to design market transparency frameworks in line with the following principles:

I.             Transparency to regulators should be timely, consistent and appropriate to fulfil market surveillance duties and to support market integrity.

II.            Public market transparency requirements should support the provision of liquidity for price formation and risk management, while doing no harm to market integrity, liquidity, efficiency and resilience.

III.           The level of transparency and timing for reporting should be appropriately calibrated based on regulatory intent, market structure, and liquidity profiles of specific assets.

IV.          An effective transparency framework is based on consultation with all market participants and a cost-benefit analysis.

V.            The market’s ability to implement requirements, including on a cross-border basis, if appropriate, is critical.

See: Full Press Release here.

GFMA provides comments on the consultation paper from the International Organisation of Securities Commissions (IOSCO), CR02/2018 – Conflicts of interest and associated conduct risks during the equity capital raising process. 

This Framework is designed to create an agreed upon approach for regulators and financial services firms to conduct effective testing to satisfy both supervisory and firm originated requirements.

See: Press Release

GFMA, ISDA and IIF letter on trading book default risk charge floor to the Sovereign Risk Task-Force

GFMA FX Division Submits Comments to the European Commission on its Fitness Check on Supervisory Reporting.

GFMA, the Institute of International Finance (IIF), and the International Swaps and Derivatives Association (ISDA) provides comments to the Basel Committee on the Basel Committee on Banking Supervision’s (BCBS) proposal on changes to the treatment of extraordinary monetary policy operations in the Net Stable Funding Ratio (NSFR).

GFMA, the Clearing House, and IIF provide comments responding to FSB’s consultation on resolution funding strategies.  

GFMA FX Division Submits Comments to the European Commission on its Consultation on Post-Trade in a Capital Market Union 

GFMA FX Division Submits Comments to the Hong Kong TMA on the Application of Initial Margin to Physically-Settled FX Forward Contracts

GFMA, FIA, and ISDA submitted a joint comment letter to the ESMA consultation on draft guidelines on non-significant benchmarks under the BMR. While supportive of the broad goals of the BMR to provide a harmonized regulatory framework for non-significant benchmarks in the EU, comments emphasized the need for greater proportionality in several aspects of the draft guidelines. The trades recommended that ESMA should eliminate or reduce some of the requirements of the draft guidelines, to achieve a more proportionate, principles-based and balanced approach, particularly where the draft guidelines covers obligations similar to those which are not applicable to non-significant benchmark under the BMR.

The Global Foreign Exchange Division (GFXD) of GFMA welcomes the opportunity to comment on behalf of its members on the Consultation on the Governance arrangements for the unique product identifier issued by the Financial Stability Board (FSB) on the 3rd October 2017.

GFMA FX Division, AFME and ISDA Submit Comments to ESMA on Outstanding Uncertainties in the MiFIR Post‐Trade Transparency Framework 

GFMA provided comments to the European Commission on its proposed enhanced supervision framework. The letter emphasizes the need for enhanced supervisory standards to support financial stability, market efficiency, and end-user choice.

GFMA provides response to IOSCO regarding consultation on regulatory reporting and transparency in the secondary corporate bond markets.

GFMA, IIF, ICMA and Australian Securitsation Forum Submit Comments to the Basel Committee and IOSCO on STC criteria for short-term securitisations.

GFMA FX Division Submits Comments to the Commodity Futures Trading Commission (CFTC) on its Request for Public Input on Simplifying CFTC Rules (Project KISS) – Clearing (RIN 3038–AE55)

GFMA FX Division Submits Comments to the Commodity Futures Trading Commission (CFTC) on its Request for Public Input on Simplifying CFTC Rules (Project KISS) – Reporting (RIN 3038–AE55) 

GFMA FX Division Submits Comments to the Commodity Futures Trading Commission (CFTC) on its Request for Public Input on Simplifying CFTC Rules (Project KISS) - Executing (RIN 3038–AE55)

GFMA FX Division Submits Comments to the Commodity Futures Trading Commission (CFTC) on its Request for Public Input on Simplifying CFTC Rules (Project KISS) – External Business Conduct Rules, Non-Cleared Margin Rules and Segregation of Independent Amount Requirements (RIN 3038–AE55)

GFMA in partnership with FIA and the International Swaps and Derivatives Association (ISDA) provide comments on ESMA’s Consultation Paper on Guidelines detailing the obligations which apply to non-significant bench-marks under the Benchmarks Regulation. 

GFMA, ISDA and the IIF submitted a letter to the Basel Committee in response to its consultation on a simplified alternative to the standardized approach to market risk capital.

GFMA FX Division Submits Comments to the South African Financial Services Board on its Draft Notice on Margin Requirements for OTC Derivatives 

GFMA FX Division and ISDA Submit Comments to ASIC, MAS, HKMA and SFC on the Implementation of the Unique Transaction Identifier (UTI)

GFMA FX Division Submits Comments to CPMI and IOSCO on their Consultative Report on the Harmonisation of Critical OTC Derivatives Data Elements (Other than UTI and UPI) – Third Batch 

GFMA, in partnership with FIA and the International Swaps and Derivatives Association3 (ISDA), provide comments on the FCA’s Consultation Paper CP17/17 Handbook changes to reflect the application of the EU Benchmarks Regulation.

GFMA FX Division Submits Comments to the CFTC on its Roadmap for its Review of Swap Reporting Rules

GFMA and ISDA provide comments in Response to the FCA Consultation on Forms for Authorisation Registration Recognition and Endorsement of Administrators

GFMA FX Division Submits Comments to the European Commission on its EMIR Amendment 

GFMA in partnership with FIA and the International Swaps and Derivatives Association (ISDA) are pleased to provide comments on the European Commission’s draft Delegated Acts under the Benchmark Regulation.

GFMA response to BCBS Consultative Document: Global systemically important banks - revised assessment framework.

GFMA, which represents the common interests of the world’s leading financial and capital market participants, believes that Brexit is an issue that has unique and global spillovers, not just isolated to the UK and EU. Brexit is an event of such magnitude that it will affect almost all dimensions of the global economy, including financial services, in some way.

The GFMA White Paper, ‘Brexit: Implications for the Global Financial System’ focuses on issues that our global members have identified as most important to their cross-border businesses and the international investment and economic growth they support.

The Global Foreign Exchange Division (GFXD) of GFMA provides comments to ASIC, HKMA, MAS and SFC on the Adoption of the CPMI-IOSCO Technical Guidance on Harmonisation of the Unique Transaction Identifier (UTI).

GFMA FX Division Submits Comments to the Central Bank of Russia on its Consultation on Mandatory Margining of Non-Centrally Cleared OTC Derivatives 

GFMA FX Division Submits Comments to ANNA-DSB on their ISIN Phase 2 Consultation Paper.

GFMA, along with the Institute of International Finance (IIF), the International Banking Federation (IBFed), the CRE Finance Council (CREFC) and the Commercial Real Estate Finance Council Europe (CREFC Europe) provide this joint response letter on the Basel Committee on Banking Supervision (BCBS) Consultative Document "Identification and management of step-in risk".

GFMA, the International Swaps and Derivatives Association (ISDA) and Japan Financial Markets Council (JFMC) responded to the Financial Stability Board (FSB) on FSB's consultation on Proposed Framework for Post-Implementation Evaluation of the Effects of the G20 Financial Regulatory Reforms.

The Global Foreign Exchange Division (GFXD) of GFMA and The International Swaps and Derivatives Association (ISDA) provide comments to the FSB on its consultation on Governance Arrangements for the Unique Transaction Identifier (UTI).

The Global Foreign Exchange Division (GFXD) of GFMA provides comments to European Securities and Markets Authority (ESMA) on the MiFID II/MiFIR Discussion/Consultation Papers issued by ESMA on the 22 May 2014.

Additional information:
AFME Response to the Discussion and Consultation Papers

The Global Foreign Exchange Division (GFXD) of GFMA and The International Swaps and Derivatives Association (ISDA) provide comments to the Bank of Israel on its Trade Reporting Order 5776-2016 

The Global Foreign Exchange Division (GFXD) of the GFMA Signs Joint Association Letter to the European Commission on EMIR Trade Reporting.

GFMA and the Institute of International Finance (IIF) provide comments to the Task Force on Climate-related Financial Disclosures, Financial Stability Board, Bank for International Settlements,

GFMA (and its Global FX Division) along with the International Swaps and Derivatives Association (ISDA), the Investment Association, Financial Services Roundtable (FSR), the ABA Securities Association, and the American Council of Life Insurers signed a joint association letter to multiple regulators, policymakers and legislators on forbearance from uncleared swap margin requirements.

Individuals from the following all received this letter:

Authorité des Marchés Financiers 
Autorité de Contrôle Prudentiel et de Résolution (ACPR) 
Authoriteit financiele markten 
Bank of England 
Bank of Italy 
Bank of Spain 
Board of Governors of the Federal Reserve System 
Commodity Futures Trading Commission 
De Nederlandsche Bank 
Department of the Treasury/Office of the Comptroller of the Currency 
European Banking Authority 
European Central Bank 
European Commission 
European Insurance & Occupational Pensions Authority 
European Securities and Markets Authority 
Farm Credit Administration 
Federal Deposit Insurance Corporation 
Federal Financial Supervisory Authority (BaFin) 
Federal Housing Finance Agency 
Financial Conduct Authority 
Japan Financial Services Agency 
Office of the Superintendent of Financial Institutions

The Global Foreign Exchange Division (GFXD) of the GFMA and International Swaps and Derivatives Association  (ISDA) Submit Comments to ANNA-DSB on their ISIN Fee Model Consultation Paper.

The Global Foreign Exchange Division (GFXD) of the GFMA provides comments to ANNA-DSB on their ISIN Technology and Operations Consultation.

GFMA-IIF response to the Basel Committee on Banking Supervision (BCBS) on the Discussion Paper, "Regulatory treatment of accounting provisions" and on the BCBS Consultative Document, "Regulatory treatment of accounting provisions – interim approach and transitional arrangements."

The Global Foreign Exchange Division (GFXD) of the GFMA provides comments to Korean Financial Supervisory Service (FSS) on its Guidelines on Margin Requirements for Non-Centrally Cleared OTC Derivatives.

GFMA FX Division Submits Comments to ESMA on its Consultation on Draft RTS on Package Orders under MiFI.

GFMA FX Division Submits Comments to the FCA on its Third Consultation Paper on MiFID Implementation CP16/29.

The Global Foreign Exchange Division (GFXD) of the GFMA Submits Comments to South Africa Reserve Bank on 15/8 Proposed Directive Issued in Terms of Section 6(6) of the Banks Act of 1990 regarding Margin Requirements for Non-centrally Cleared Derivatives 

GFMA, FIA and the International Swaps and Derivatives Association (ISDA) are pleased to provide comments to European Securities and Markets Authority (ESMA) on ESMA’s Consultation Paper on draft technical standards under the Benchmarks Regulation. We appreciate ESMA’s desire to solicit stakeholder views in order to facilitate the finalization of regulatory and implementing technical standards supporting the implementation of the Benchmarks Regulation (the “BMR”).

Note: The PDF download is the ESMA Reply form for the Consultation Paper on Benchmarks Regulation

The Global Foreign Exchange Division (GFXD) of the GFMA provides comments to CPMI and IOSCO on their Consultative Report on the Harmonisation of Critical OTC Derivatives Data Elements (Other than UTI and UPI) – Second Batch.

Please note: the PDF download includes the consultation paper with the GFXD response to each question; this is the mandated consultation format.

The Global Foreign Exchange Division (GFXD) of the GFMA provides comments to European Securities and Markets Authority (ESMA) on its Discussion Paper on the Trading Obligation for Derivatives under MiFIR

The GFMA Commodities Working Group (CWG) provides comment to the Financial Conduct Authority (FCA) in response to their Consultation on Markets in Financial Instruments Directive II Implementation (CP16/19) 

GFMA provides comments to the Chair of the Group of Governors and Heads of Supervision (GHOS) in support of appropriately calibrated global minimum standards. GFMA endorses the Committee’s objective in revising the risk-based capital framework to achieve an appropriate balance between its risk sensitivity, simplicity and comparability and welcomes the GHOS commitment that these revisions should not, in aggregate, lead to a significant increase in overall capital levels. 

The Global Foreign Exchange Division (GFXD) of the GFMA Submits Comments to ASIC, HKMA and MAS on their Decision to Delay the UTI “Share and Pair” Requirement

GFMA and the Institute of International Finance (IIF) provide comments to the International Organization of Securities Commissions (IOSCO) in response to the IOSCO paper and consultation issued in August 2016 entitled Examination of Liquidity of the Secondary Corporate Bond Markets.

The Global Foreign Exchange Division (GFXD) of the GFMA, FIA, ISDA and ICMA Submit Comments to the European Commission and ESAs on the presentation, content, review and revision of key information documents under PRIIPs 

GFMA, ISDA, FIA, LEBA and EFET MiFID II Commodity Derivatives Position Limits Paper.

Also, see:
GFMA, ISDA, FIA, LEBA and EFET MiFID II Application of Position Limits to Non-Commodity Contracts and to Securitised Commodity Derivatives 

GFMA, ISDA, FIA, LEBA and EFET MiFID II Application of Position Limits to Non-Commodity Contracts and to Securitised Commodity Derivatives.

Also, see:
Application of position limits to non-commodity contracts and to securitised commodity derivatives

GFMA FX Division Submits Comments to CFTC on the Swap Clearing Requirements Pursuant to Section 2(h)(2)(D) of the Commodity Exchange Act 

GFMA FX Division Submits Comments to CPMI and IOSCO on their second Consultative Report on the Harmonisation of the Unique Product Identifier (UPI) 

The Global Foreign Exchange Division (GFXD) of the GFMA, ISDA and ICMA Submit Comments to the FCA on its Consultation Paper CP16/18 on Changes to Disclosure Rules in the FCA Handbook to Reflect the Direct Application of the PRIIPs Regulation 

The Global Foreign Exchange Division (GFXD) of the GFMA provides comments to the Central Bank of Russia on its Consultation Paper on Mandatory Clearing of Standardised OTC Derivatives 

The Global Foreign Exchange Division (GFXD) of the GFMA and ISDA provides comments to ASIC on Foreign Privacy Restrictions (Exemption 5) under ASIC Corporations (Derivative Transaction Reporting Exemption) Instrument 2015/844 

The Global Foreign Exchange Division (GFXD) of the GFMA provides comments to ASIC on the Treatment of Securities Conversion Transactions under the ASIC Corporations (Derivative Transaction Reporting Exemption) Instrument 2015/844 

The Global Foreign Exchange Division (GFXD) of the GFMA Submits Comments to the South African National Treasury on the Third Draft of the Ministerial Regulations on Regulating OTC Derivative Markets

GFMA provided comments to regulators on a request for postponement of margin requirements for uncleared swaps for phase 1 covered swap entities. Individuals from the CFTC, Office of the Comptroller of the Currency, Federal Deposit Insurance Corporation, Federal Reserve System, Federal Housing Finance Agency and Farm Credit Administration Board all received this letter.

GFMA, the Institute of International Finance (IIF), International Banking Federation (IBFed), and the International Swaps and Derivatives Association (ISDA) provides a joint response on behalf of the industry IRRBB Working Group on the Basel Committee on Banking Supervision (BCBS) Consultative Document on Interest Rate Risk in the Banking Book (IRRBB)

GFMA Commodities Working Group (CWG) provided this paper on economically equivalent OTC contracts (EEOTC) to HM Treasury as a follow up from their March 2016 meeting.

GFMA Commodities Working Group (CWG) provided this paper on position limits/reporting regimes to HM Treasury prior to a meeting with it.

GFMA provides letter to multiple regulators accompanying a copy of a report commissioned from Oliver Wyman, which analyzes the interaction, coherence, and overall calibration of post crisis regulatory reform measures agreed upon, or under active consideration, by the Basel Committee on Banking Supervision (BCBS).  The full report is available here.

Also, see: GFMA Press Release

GFMA provided comments to legislators, policymakers and regulators on Packaged Retail and Insurance-based Investment Products regulation (PRIIPs) and Foreign Exchange Forwards. Individuals from the European Parliament, European Commission, ESMA, EBA, EIOPA, AMF, BaFIN and FCA all received this letter. 

GFMA with Other Associations Submit Comments to the BCBS on to the Consultative Document on Revisions to the Basel III Leverage Ratio Framework.

GFMA along with other trade associations provided comments to a group of domestic and international regulatory agencies on Regulatory‐Mandated Third‐Party Penetration. We encourage a dialogue over industry concerns over the recent proliferation of penetration testing regulations and guidance from regulators, SROs, and government agencies around the world, and the downstream impact to the financial services industry. Among other agencies, the OCC, FRB, SEC, CFTC, FINRA, and Treasury all received this letter.

GFMA FX Division Submits Comments to CPMI and IOSCO on the Identification of the "Direction" (Payer/Receiver) for a FX Swap and a FX Forward. 

The Global Foreign Exchange Division (GFXD) of the GFMA provides comments to Australian Prudential Regulation Authority (APRA) on the Treatment of Securities Conversion Transactions under the Margin and Risk Mitigation Standards.

GFMA, the International Swaps and Derivatives Association (ISDA), the International Association of Credit Portfolio Managers (IACPM) and the Japan Financial Markets Council (JFMC), provide comments to Basel Committee on Banking Supervision (BCBS) to respond to the Basel Committee’s Consultative Document “Reducing variation in credit risk-weighted assets – constraints on the use of internal model approaches”.

GFMA, the Institute of International Finance (IIF), and the International Swaps and Derivatives Association (ISDA), provide comments to Bank for international Settlements (BIS) on the second phase of the development of the revised Pillar 3. 

The Global Foreign Exchange Division (GFXD) of the GFMA provides comments to the Hong Kong Monetary Authority (HKMA) on the Treatment of Securities Conversion Transactions under the Margin and Other Risk Mitigation Standards

GFMA and the Institute of International Finance (IIF) provide comments to Basel Committee on Banking Supervision (BCBS) on the Standardised Measurement Approach (SMA) for operational risk Consultative Document.

The Global Foreign Exchange Division (GFXD) of the GFMA provides comments to the Reserve Bank of India on its Discussion Paper on Margin Requirements for Non-Centrally Cleared Derivatives.

The Global Foreign Exchange Division (GFXD) provides comments to Australian Prudential Regulation Authority (APRA) on its Discussion Paper on Margining and Risk Mitigation for Non-Centrally Cleared Derivatives 

GFMA provides comments to the Bank for International Settlements (BIS) in response to the Financial Stability Board (FSB) consultation document “Transforming Shadow Banking into resilient Market-based Finance—Possible Measures of Non-Cash collateral Re-Use” (Consultation Document).  

GFMA, the European Banking Federation (EBF), and International Swaps and Derivatives Association (ISDA) publish a paper, “International Cybersecurity, Data and Technology Principles,” that offers the groups’ thoughts on foundational principles for the formation of effective policy on cybersecurity, data and technology.   

Read GFMA Press Release

The Global Foreign Exchange Division (GFXD) provides comments to the European Commission on the Final Draft Regulatory Technical Standards for Margin Requirements for Non-Centrally Cleared Derivatives.

GFMA provides comments to Bank for International Settlements (BIS) on the Basel Proposal regarding reducing variation in credit risk-weighted assets constraints on the use of internal model approaches.

The Global Foreign Exchange Division (GFXD) of the GFMA signs joint Association letter ‘Improving Derivatives Transparency: The Merits of an Entity-based Reporting Framework’ 

GFMA, the Institute of International Finance (IIF), the International Swaps and Derivatives Association (ISDA) and the International Association of Credit Portfolio Managers (IACPM) provide comment on the Basel Committee on Banking Supervision’s (BCBS) second proposal on revisions to the standardized approach for credit risk. The Associations would like to thank the BCBS Task Force on the Standardized Approach (TFSA) for the opportunity to raise with them in person some of the industry’s comments on the proposals at the meeting in Basel on February 17. 

GFMA, with FIA and the International Swaps and Derivatives Association (ISDA), provide comments to European Securities and Markets Authority (ESMA) on their Discussion Paper on Benchmarks Regulation.  

The Global Foreign Exchange Division (GFXD) of the GFMA provides comments to ESMA on its Consultation Paper on Guidelines on Transaction Reporting, Reference Data, Order Record Keeping & Clock Synchronisation

The Global Foreign Exchange Division (GFXD) of the GFMA provides comments to the Commodity Futures Trading Commission (CFTC) on its consultation on Draft Technical Specifications for Certain Swap Data Elements 

GFMA drafted and today submitted comments to the Basel Committee on its Step-In Risk consultation (joined by CREFC, CREFC Europe, the Real Estate Roundtable).  The Basel Committee issued this consultation to address the risk that a bank would ‘step in’ to provide voluntary, non-contractual support for a transaction (such as what banks did with SIVs or credit card ABS in the crisis).  The Basel Committee’s proposal would require a bank to examine all off-balance sheet vehicles and other relationships which are not currently capitalized and, if step-in risk indicators are there, hold capital for them as if they were on-balance sheet.  The proposal is very expansive and could require massive amounts of effective consolidation if read broadly.  GFMA/CREFC/RER’s position is that the proposal is not needed given the massive amount of regulatory change (importantly including changes to off-balance sheet accounting rules, the Volcker Rule in the US, and other regulations) that have largely addressed this problem.  We do not believe step-in risk is a material issue at this point and suggest the Basel Committee should forego implementing new rules in this area.  We also raise significant concerns with the lack of clarity and expansive breadth of the proposal.  

See also:
Identification and measurement of step-in risk - consultative document

The Global Foreign Exchange Division (GFXD) of the GFMA provides comments to Committee on Payments and Market Infrastructure (CPMI) and Board of the International Organisation of Securities Commissions (IOSCO) on their Consultative Report on the Harmonisation of the Unique Product Identifier (UPI).

The Global Foreign Exchange Division (GFXD) of the GFMA provides comments to the Monetary Authority of Singapore on its Consultation Paper on Proposed Amendments to the Securities and Futures (Reporting of Derivative Contracts) Regulations

GFMA and the International Association of Credit Portfolio Managers (IACPM) provide comments to the Basel Committee on Banking Supervision (BCBS) in response to BCBS Consultative Document on Capital treatment for "simple, transparent and comparable" securitisations.

The Global Foreign Exchange Division (GFXD) of the GFMA provides comments to the Hong Kong Monetary Authority (HKMA) on its Consultation Paper on Non-Centrally Cleared OTC Derivative Transactions – Margin and Other Risk Mitigation Standards.

The Global Foreign Exchange Division (GFXD) of the GFMA and International Swaps and Derivatives Association, Inc. (ISDA) provide comments to the Ontario Securities Commission (OSC), Autorité des marchés financiers (AMF) and Manitoba Securities Commission (MSC) on Changes to their Respective 91-507 Regulations and to the AMF on Changes to its 91-506 Regulation on Trade Reporting.

GFMA provides comments to the Basel Committee on Banking Supervision (BCBS) in response to the Consultative Document: Haircut floors for non-centrally cleared securities financing transactions.

See:
Haircut floors for non-centrally cleared securities financing transactions - consultative document

The Global Foreign Exchange Division (GFXD) of the GFMA provides comments to the Hong Long Monetary Authority (HKMA) and the Securities and Futures Commission (SFC) on the proposed reporting fields in their Consultation Paper Introducing Mandatory Clearing and Expanding Mandatory Reporting.

Global Financial Markets Association (GFMA), Investment Industry Association of Canada (IIAC), The Institute of International Finance (IIF) and International Swaps and Derivatives Association, Inc. (ISDA) provide response to the Legal Entity Identifier Regulatory Oversight Committee’s (ROC) “Consultation Document: Including data on branches in the Global LEI System.” Overall, the associations support the ROC’s proposal to incorporate an identification approach for branches into the Global LEI System (GLEIS) as there is a need for such an identifier.  The associations strongly agree there is a need for a global, standardized approach for the regulatory reporting of branches and branch activity and believe the LEI system provides a good operational structure for this purpose.  While the associations support new guidance for a branch identifier, they have several concerns with the approach proposed by the ROC and make recommendations for addressing those concerns in the letter. 

The Global Foreign Exchange Division (GFXD) of the GFMA provides comments to the Monetary Authority of Singapore (MAS) on their Policy Consultation on Margin Requirements for Non-Centrally Cleared OTC Derivatives.

The Global Foreign Exchange Division (GFXD) of the GFMA provides comments to the Hong Kong Monetary Authority (HKMA) and the Securities and Futures Commission (SFC) on their Consultation Paper Introducing Mandatory Clearing and Expanding Mandatory Reporting

GFMA, the International Swaps and Derivatives Association (ISDA), and the Institute of International Finance (IIF)  provide comments to the Group of Governors and Heads of Supervision (GHOS), Basel Committee on Banking Supervision (BCBS), and Bank for International Settlements to highlight key areas of the Fundamental Review of the Trading Book (FRTB) framework that require further consideration in order to ensure a balanced and more robust market risk capital framework and prevent negative impacts on the market broader economy.

The International Swaps and Derivatives Association (ISDA), the Global Financial Markets Association (GFMA) and the International Institute of Finance (IIF) set out in this document their key findings from the analysis of the results that 28 banks1 submitted to the Basel Committee on Banking Supervision’s (BCBS) Quantitative Impact Study (QIS) on the Fundamental Review of the Trading Book (FRTB) with June 2015 reference data (henceforth “QIS analysis”). The objective of this initiative was to investigate the aggregate impact of the proposed FRTB framework and to provide data-driven feedback to the policymakers for further consideration.

The Basel QIS submissions for the 28 globally / locally significant banks were combined to generate comparative metrics for an “Aggregate Bank”. The quantitative analysis was complemented by qualitative reviews, including a survey of banks’ confidence in their interpretation of the QIS instructions and of the estimates that they submitted. We believe this supplementary qualitative information provides useful context for the estimates of an industry-wide impact of the current FRTB proposals.

The Global Foreign Exchange Division (GFXD) of the GFMA, the International Swaps and Derivatives Association (ISDA) and the Investment Association (IA) provide comments to CPMI and IOSCO on their Consultative Report on the Harmonisation of Key OTC Derivatives Data Elements (other than UTI and UPI).

The Global Foreign Exchange Division (GFXD) of the GFMA provides comments to the Committee on Payments and Market Infrastructures (CPMI) and the International Organization of Securities Commissions (IOSCO) on their Consultative Report on the Harmonisation of the Unique Transaction Identifier (UTI)

The Global Foreign Exchange Division (GFXD) of GFMA provides comments to the European Commission’s Public Consultation on Regulation (EU) No 648/2012 on OTC Derivatives, Central Counterparties and Trade Repositories

The Global Foreign Exchange Division (GFXD) of the GFMA provides comments to the Monetary Authority of Singapore (MAS) on its Consultation Paper on Draft Regulations for Mandatory Clearing of Derivatives Contracts issued by the MAS on 1 July 2015.

The Global Foreign Exchange Division (GFXD) of GFMA provides comments to the  European Securities and Markets Authority (ESMA) on the questions listed in the ESMA Addendum Consultation Paper on MiFID II/MiFIR (Issued on the 18 February 2015).

GFMA Commodities Working Group (CWG) and International Swaps and Derivatives Association (ISDA) provide responses and questions to the Agency for the Cooperation of Energy Regulators (ACER) in relation to REMIT implementation.

Related: ACER welcomes adoption of REMIT Implementing Acts

The Global Foreign Exchange Division (GFXD) of GFMA provides comments to the Monetary Authority of Singapore (MAS) on the Policy Consultation on Regulatory Framework for Intermediaries Dealing in OTC Derivative Contracts, Execution-Related Advice, and Marketing of Collective Investment Scheme issued by MAS on 3 June 2015.

 GFMA Commodities Working Group (CWG) provides response to the HM Treasury Consultation on the Transposition of the Markets in Financial Instruments Directive II and includes response to questions related to the Position Limits and Reporting regimes.

Related: Transposition of the Markets in Financial Instruments Directive II (pdf)

GFMA's Commodities Working Group (GFMA CWG) submitted comments to the Commodity Futures Trading Commission (CFTC) in response to a proposed rulemaking notice regarding position limits for derivatives (Proposed Rule).

GFMA CWG urges the CFTC to avoid the anomalies and associated impacts to liquidity and the proper functioning of the market that are likely to arise as a result of the Proposed Rule's failure to appropriately address dealers' net risk positions taken to hedge commitments under commodity index contracts.

GFMA and The Financial Services Roundtable (FSR) provide comments to the Commodity Futures Trading Commission (CFTC) requesting time-limited relief for swap dealers to comply with CFTC Regulation 23.504 (STRD Rule) in connection with deliverable foreign exchange (FX) swaps and foreign exchange forwards. 

While the current FX industry best practice is to document transactions with their counterparties in Exempt FX Products, it is not universal for the reasons described in this letter. Because of the significant number of institutions that trade Exempt FX Products that are not covered by Compliant Documentation, the lack of awareness that the STRD Rule applied to Exempt FX Products, and the lengthy negotiations necessary to enter into new documentation (because such documentation does not exist, or to amend existing documentation to bring Exempt FX Products within scope), many institutions will be unable to satisfy the STRD Rule by July 1, 2013.

GFMA and the Australian Securitisation Forum (AuSF) provide comments to the SEC regarding proposed revisions to Regulation AB under the U.S. Securities Act of 1933 (Regulation AB).

The Securities and Exchange Commission is re-opening the comment period for the Asset-Backed Securities Releases (Release Nos. 33-9552; 33-9244; File No. S7-08-10).

GFMA, SIFMA and the Asset Management Group of SIFMA (SIFMA AMG), The Australian Financial Market Association (AFMA), the Alternative Investment Management Association (AIMA), the British Bankers Association (BBA), the German Investment Funds Association (BVI), the European Fund and Asset Management Association (EFAMA), the Futures Industry Association (FIA Global), the Global Foreign Exchange Division (GFXD) of the Global Financial Markets Association (GFMA), the International Swaps and Derivatives Association (ISDA), the Managed Funds Association (MFA) and The Investment Association provide comments supporting key principles to improve global trade reporting and data harmonization. 

This letter was sent to:

ASIC
BIS
Canadian Securities Administrators
CFTC
CPMI
EBA
ECB
EC
ESMA
FSB
FINMA
HKMA
IOSCO
JFSA
MAS
OFR
Reserve Bank of Australia
SEC

GFMA with the Institute of International Finance (IIF) provides comments to the Financial Stability Board (FSB) in response to the FSB consultative document on cross-border recognition of resolution action and on guidance on cooperation and information sharing with host authorities of jurisdictions not represented on CMGs where a G-SIFI has a systemic presence.

The Global Foreign Exchange Division (GFXD) of GFMA provides comments to the Canadian Securities Administrators (CSA) on the CSA Proposed National Instrument 94-101 and Companion Policy – Mandatory Central Counterparty Clearing of Derivatives.

GFMA, the International Swaps and Derivatives Association (ISDA) and the Institute of International Finance (IIF) provide comment to the Basel Committee on Banking Supervision (BCBS) and the Group of Governors and Heads of Supervision (GHOS) requesting that the timeline for finalizing the fundamental review of the trading book (FRTB) be reconsidered in order to assess changes to key components of the FRTB since the third consultation document. The additional time will allow adequate assessment of impact on products and markets to ensure that this is aligned with the overall public policy goals.

GFMA, the Institute of International Finance (IIF),  the International Swaps and Derivatives Association (ISDA), and the Commercial Real Estate Finance Council (CREFC) provide comment to the Basel Committee on Banking Supervision (BCBS) on their December 2014 Consultative Document,  “Capital Floors: the design of a framework based on standardized approaches.”

The Associations support the work of the Committee and specifically of the Task Force for Simplicity and Comparability (TFSC) aimed at conducting a comprehensive review of the capital framework and its overall calibration and taking stock of the multiple changes thereto in the course of the past 5 years. The Associations are equally supportive of the Committee’s goal to remove undue complexity and improve the comparability of banks’ capital requirements. The Joint Associations welcome the opportunity to contribute to the discussion on capital floors.

Related:
The December 2014 Consultative Document - Capital floors: the design of a framework based on standardised approaches - consultative document

GFMA and its regional members, SIFMA, AFME and ASIFMA, provide comments to the Organisation for Economic Co-operation and Development (OECD) Centre for Tax Policy and Administration to express concerns regarding the current timeframe for both implementing and ensuring compliance with the Common Reporting Standard (CRS) for automatic exchange of information on financial accounts.

Related:
GFMA White Paper on Implementation of the OECD's Common Reporting Standard - 5 February 2015

GFMA's Commodities Working Group (GFMA CWG) provided comments to the European Securities and Markets Authority (ESMA) in response to the ESMA MiFID2 Consultation Paper.

GFMA provides comments to the International Organization of Securities Commissions (IOSCO), the BIS’ Committee on Payments and Market Infrastructures (CPMI), and others commending their proactive role in addressing cybersecurity, and encouraging them to work jointly with industry to defend against cyber attacks and cyber crime and increase the protection of financial markets and financial market participants.

Of Interest:

SIFMA’s Principles for Effective Cybersecurity Regulatory Guidance - 20 October 2014

GFMA, the International Capital Market Association (ICMA), the Institute of International Finance (IIF) and International Swaps and Derivatives Associations (ISDA) (together the "Joint Associations") responded to the Consultation Document entitled "Criteria for identifying simple, transparent and comparable securitisations" published by the Basel Committee on Banking Supervision (BCBS) and the Board of the International Organization of Securities Commissions (IOSCO) on 11 December 2014. 

The Global Foreign Exchange Division (GFXD) of GFMA provides comment to the European Securities and Markets Authority (ESMA) on the Consultation Paper issued by ESMA on 10 November 2014.

This white paper reflects the views SIFMA, AFME and ASIFMA, collectively, the “Working Group” with regard to implementing the OECD’s Common Reporting Standard (CRS).

Related:
GFMA Submits Comments to OECD Regarding Implementation of the Common Reporting Standard Background - 16 March 2015

GFMA brings together three of the world's leading financial trade associations to address the increasingly important global regulatory agenda and to promote coordinated advocacy efforts. The Association for Financial Markets in Europe (AFME) in London and Brussels, the Asia Securities Industry & Financial Markets Association (ASIFMA) in Hong Kong and the Securities Industry and Financial Markets Association (SIFMA) in New York and Washington are, respectively, the European, Asian and North American members of GFMA.

GFMA and the Institute of International Finance (IIF) provide comments to the Financial Stability Board (FSB) on the FSB's publication of a term sheet (TS) for Total Loss Absorbing Capacity (TLAC) for Global Systemically Important Banks (G-SIBs).

GFMA provides comments to the Office of the Comptroller of the Currency (OCC,) Board of Governors of the Federal Reserve System, Federal Deposit Insurance Corporation (FDIC), Federal Housing Finance Agency (FHFA), Farm Credit Administration and the Commodity Futures Trading Commission (CFTC) on margin and capital requirements for covered swap entities and margin requirements for uncleared swaps.

GFMA's Commodities Working Group (GFMA CWG) provides comment to the European Securities and Markets Authority (ESMA) Consultation Paper regarding Guidelines on the application of C6 and C7 of Annex I of MiFID1.

GFMA with the Institute of International Finance (IIF), the International Banking Federation (IBFed), and the International Swaps and Derivatives Association (ISDA) provide comments to the Basel Committee’s Task Force on Interest Rate Risk (TFIR) with the industry’s comments on the templates for the interest rate risk in the banking book (IRRBB) / credit spread risk in the banking book (CSRBB) quantitative impact study (QIS).

The Global Foreign Exchange Division (GFXD) of GFMA provided comments to the US prudential authorities and CFTC on (re)proposed margin rules on uncleared swaps.

The GFXD supports the Agencies’ efforts to establish margin requirements which would help ensure the safety and soundness of covered swap entities and would be appropriate for the risk to the financial system associated with non-cleared swaps held by such entities. The GFXD views the proposed margin regime in the U.S. as achieving the international regulatory framework’s goal of promoting global consistency and reducing regulatory arbitrage opportunities with respect to the treatment of physically-settled OTC FX forwards and swaps, specifically that (i) initial margin not apply to these contracts and (ii) variation margin be applied via supervisory guidance or national regulation.

GFMA wrote a letter to all G20 Finance Ministers recommending improved coordination in the implementation of reforms in different jurisdictions. GFMA believes international coordination efforts can be strengthened further and that more needs to be done at the G20 level to ensure individual jurisdictions honor their global commitments in domestic policy implementation.

The Global Foreign Exchange Division (GFXD) of GFMA provides comments to European Securities and Markets Authority (ESMA) on the Consultation Paper on the Clearing Obligation under EMIR (no. 3) -- FX NDFs on 06 November 2014.

GFMA, the Institute of International Finance (IIF), and the International Swaps and Derivatives Association (ISDA) provided comments to the Basel Committee for Banking Supervision (BCBS) on the Basel Committee’s consultation on standards for the future Pillar 3 disclosure regime.

 GFMA provides comments  to the Department of Energy and Climate Change's Consultation on strengthening the regulation of wholesale energy markets through new criminal offences.

Consultation reference: URN 14D/277 - August 2014 (PDF)

GFMA, FIA Europe, and the International Swaps and Derivatives Association (ISDA) provide comments to the European Commission to express ongoing concerns regarding the reporting regime under the Regulation of Wholesale Energy Market Integrity and Transparency (1227/2011)(REMIT), by way of follow up to our 2 June 2014 letter  on the same subject.

The Global Foreign Exchange Divisions (GFXD) of GFMA provides comment to the FSB FX Benchmark Working Group on its consultative document on FX benchmarks.

 GFMA, the Institute of International Finance (IIF), and other associations submitted a supplemental comment letter to the Basel Committee on Banking Supervision (BCBS) to emphasize serious concerns with the treatment of equities under the BCBS’s consultative document on the revised Net Stable Funding Ratio (Revised NSFR), and the impact such treatment will have on the market and market participants. 

Prior to the supplemental comments, the trade associations submitted a comment letter to the BCBS on April 11 in response to the BCBS’s Revised NSFR. The groups continue to continue to strongly support the comments raised in the prior letter, including the equities-related comments. Therefore, none of the points outlined in the supplemental letter should be construed to supersede or override any of our original requested alternative treatments for equities or non-equities instruments.

 Related Material

Prior Comment Letter: GFMA Submits Comments to the BCBS for the Consultative Document on Basel III and the Net Stable Funding Ratio (April 11, 2014)

BCBS, Basel III: The Net Stable Funding Ratio (January 2014)

The Global Foreign Exchange Division (GFXD) of GFMA provided comments to the Australian Securities and Investments Commission's (ASIC) on its Consultation Paper 221: OTC derivatives reform, regarding proposed amendments to the ASIC Derivative Transaction Rules (Reporting) 2013.

GFMA's Commodities Working Group (CWG) provides comments to the European Securities and Markets Authority (ESMA) MiFID II/MiFIR Consultation and Discussion Papers.

 The Global Foreign Exchange Division (GFXD) of GFMA provides comments  on the Consultation Paper issued by the Hong Kong Monetary Authority (HKMA) and the Securities and Futures Commission (SFC) on 18 July 2014.

GFMA and other associations provides further information to the Basel Committee for Banking Supervision (BCBS or the Committee) for BCBS to consider as they move toward completing work on the proposals set out in the second consultative document, "Revisions to the Basel securitisation framework."

The groups remain concerned that the current proposals will not meet the Committee's stated objective of comparability, resulting instead in capital requirements that are neither comparable among calculation methods nor proportionate to risks.

It is essential that the timetable for finalisation of the proposed framework is extended to address those shortcomings. Additional work should be undertaken to refine the calibration of the proposed framework and especially to improve the consistency of results between the internal ratings-based approach (IRBA), the external ratings-based approach (ERBA) and the standardised approach (SA). This should include gathering additional, more granular data and undertaking further analysis beyond what was provided in the QIS. In particular, we would recommend conducting analysis of data grouped by the market-defined asset classes of the underlying exposures (rather than according to the regulatory exposure categories). Further consideration should also be given to additional analytical work provided by the industry and referred to in the Joint Associations' comment letter dated 24 March 2014 (Comment Letter).

RCL has conducted an analytical study of certain data provided by a number of GFMA's member banks. These data are limited as explained in the Report, and the Report should be read and understood in that context. It is especially important to note that the Report does not advocate or support a particular calibration method or outcome, and in particular we do not intend that any of the implied p-values set out in the report should be used to calibrate the revised framework. Rather, the Report reveals a number of results that we respectfully ask the Committee to consider as they continue to work on the proposed revisions.

Related Material

RCL Report: Quantitative Impacts of BCBS 269 Securitisation Capital Approaches (August 8, 2014)

BCBS 269: "Revisions to the Basel securitisation framework" (December 21, 2013)

GFMA and Other Associations Submit Comments to the BCBS on the BSBC's Second Consultative Document on the Basel Securitisation Framework (March 24, 2014)

The Global Foreign Exchange Division (GFXD) of GFMA provides comments on the Consultation Paper P010-2014 issued by the Monetary Authority of Singapore (MAS) on on 9 July 2014.

GFMA writes a letter to the B20 on the importance of "Improving Global Regulation of Markets."

Over the last few years, it has become apparent that a major challenge to the implementation of financial regulatory reform efforts has been diverging (and at times conflicting or duplicative) national and/or regional regulatory frameworks. 

GFMA believe that an outcomes-focused recognition approach, where regulators are able to rely on the oversight of other regimes adhering to the same general regulatory objectives, would serve to avoid many of the above referenced issues.

GFMA and the Japan Financial Markets Council (JFMC) provide comments to International Organization of Securities Commissions (IOSCO) with recommendations on Global Regulatory Coordination and responses to IOSCO Task Force on Cross-Border Regulation Roundtable Question Sets

The Global Foreign Exchange Division (GFXD) of GFMA provides comments to European Banking Authority (EBA), European Insurance and Occupational Pensions Authority (EIOPA), European Securities Markets Authority (ESMA) on the Consultation Paper on draft regulatory technical standards on risk-mitigation techniques for OTC-derivative contracts not cleared by a CCP under Article 11(14) or Regulation (EU) No 648/2012 published by the EBA, EIOPA and ESMA (Authorities).

GFMA, the Futures Industry Association Europe (FIA Europe), and the International Swaps and Derivatives Association (ISDA) provide comments to the European Commission with concerns regarding the reporting regime under the Regulation on Wholesale Energy Market Integrity and Transparency (1227/2011) (REMIT).

The Commodities Working Group (CWG) of GFMA provides comments to the International Organization of Securities Commissions (IOSCO) and the Financial Conduct Authority (FCA) on the implementation of PRA Principles (Principles) which were published October 2012.

GFMA welcomes the development of these Principles by IOSCO as a step towards ensuring that key oil market benchmarks are subject to robust, consistent, transparent and sound practices. Moreover, we fully endorse IOSCO’s review of the implementation of the Principles to ensure the smooth functioning and transparency within these markets.

While supportive of the progress to date, GFMA considers that more could be done to ensure market integrity. GFMA believes that PRAs should move forward with codes of conduct in line with the Principles. These codes must be sufficiently robust to ensure transparency of methodology and price assessment, and also to strengthen governance oversight, internal controls (including identification of trade anomalies and verification by third parties) and management of conflicts of interest.

GFMA and the Financial Industry Association (FIA) respond to the Agency for the Cooperation of the Energy Regulators (ACER) on ACER's Consultation: Draft Trade Reporting User Manual (TRUM) for trade reporting under The Regulation on Energy Market Integrity and Transparency (REMIT).  

In addition to addressing the specific questions in the consultation, the groups take the opportunity to raise some high level points that we feel are important in the wider context of the reporting regime under REMIT.

The Global Foreign Exchange Divisions (GFXD) of GFMA provides comment on the Commission's Review of Swap Data Recordkeeping and Reporting Requirements.

The GFXD recommends that the CFTC considers the implications, financial and otherwise, of any recommendations that the CFTC may make to its existing part 45 requirements as a result of this Request for Comment. We also urge the CFTC to align any recommended changes to those recently recommended by the GFXD in our response to the FSB's Consultation Paper regarding the aggregation of OTC derivatives data.

The Global Foreign Exchange Divisions (GFXD) of GFMA provides comment to the European Commission on its consultation document on FX financial instruments.

 Because transactions in FX spot, alongside FX swaps and FX forwards, are integral to the global payment system, international trade, cross-border activity and monetary policy, it is essential that the smooth functioning of the FX market not be disrupted. For these reasons, we wish to emphasize the importance in ensuring that the regulatory treatment of FX products within the European Union – and across multiple jurisdictions globally – is consistent.

GFMA, the Institute of International Finance (IIF) the International Swaps and Derivatives Association, Inc (ISDA) provide comments to the Basel Committee on Banking Supervision (BCBS) on the revised Standardized Approach for Market Risk.

The industry believes that the Sensitivity Based Approach (SBA), as put forward by the BCBS, constitutes a significant improvement to the previous version of the methodology and is in line with industry recommendations on leveraging upon existing validated risk metrics to calculate the market risk capital requirements.

The Advanced Cash Flow Approach (ACFA) methodology, on the other hand, is not computationally supported by existing infrastructure, since cash flow data are not captured at the trade level. As a result, industry members would require extensive resources to adhere to currently proposed regulatory timelines whilst achieving little in terms of enhancing the risk sensitivity of output metrics. This would be particularly onerous for smaller organizations.

GFMA provides comments to the Basel Committee on Banking Supervision (BCBS) on proposals set out in the Consultative Document Basel III: the Net Stable Funding Ratio (NSFR) published by the BCBS on 11th January 2014 (Consultation Paper).

This letter sets out GFMA’s detailed points on securitisation only, and is intended to supplement the broader letter of even date submitted by the Institute of International Finance (IIF), the GFMA and others.

GFMA agrees with the BCBS that securitisation, prudently deployed and sensibly regulated, can make a very positive contribution to a bank’s overall liquidity management. GFMA requests that the Committee engage in a similar way with the industry in this, relatively new, context of the NSFR in order to achieve a treatment of high quality securitisation that accurately recognises its strong credit performance through and since the financial crisis as well as its benefits as a self-liquidating funding tool for the real economy.

The Global Foreign Exchange Division (GFXD) of GFMA provides comments to the European Commission and the European Securities and Markets Authority (ESMA) on consistent regulatory treatment for incidental foreign exchange (FX) transactions related to foreign securities settlement, commonly known as, “FX Security Conversions.”

As part of the clarification and as an interim step, the GFXD asks the European Commission to consider an FX transaction that is entered into solely to effect the purchase or sale of a foreign security (FX Security Conversions) – to be a bona fide spot transaction in situations where the settlement period is greater than two days.

To do so, the GFXD requests the European Commission and National Competent Authorities in the EU to confirm that FX Security Conversions are not financial instruments under the Markets in Financial Instruments Directive (MiFID). This would also have the effect of ensuring that FX Security Conversions are not subject to the European Markets infrastructure Regulation (EMIR). The GFXD has continually requested consistent global treatment for FX Security Conversions, and this would bring Europe into convergence with the US and Canada.

GFMA Chief Executive Simon Lewis writes to the editors of the Financial Times calling for G20 finance ministers and financial heads of all nations to formally endorse the robust application of the international principle of comity – where the home regulator defers to the host regulator where the latter’s rules are consistent with the G20 recommendations and best practices.

GFMA shared a list of Markets in Financial Instruments Directive II (MiFID II) technical issues with European regulators during the trilogue meetings on MiFID (January 2014).

GFMA and other associations provide a response to the Basel Committee for Banking Supervision (BSBC) on the BCBS' second consultative document, Revisions to the Basel Securitisation Framework (published 21 December 2013).The groups welcome the development of a simpler and more straightforward hierarchy of approaches, some reduction of risk weights for higher credit quality exposures, including reduction of the risk weight floor, recognition of credit protection provided by excess spread, preservation of existing flexibility in application of the Internal Ratings-Based Approach (IRBA), preservation of the Internal Assessments Approach (IAA), and requiring one rather than two qualifying credit ratings for application of the External Ratings-Based Approach (ERBA).

However, the groups believe that the proposed capital requirements for securitisation exposures, especially for higher quality exposures and for medium-term and longer-maturity transactions, remain much higher than justified by historical loss incidence in most asset classes, by comparison with other methods of finance or in relation to the capital requirements of the underlying asset pools. These excessive capital requirements will discourage banks from investing in or otherwise acquiring exposure to securitisation transactions. The groups recommend specific changes to certain of the modelling assumptions and parameters used in formulating and calibrating the approaches, as well as changes to the operating conditions for certain approaches and to the risk weight floor and capital cap provisions.

GFMA signed the letter with the follow groups: The Commercial Real Estate Finance Council (CREFC), the Commercial Real Estate Finance Council Europe (CREFC Europe), the Institute of International Finance (IIF), the International Association of Credit Portfolio Managers (IACPM), the International Swaps and Derivatives Association, Inc (ISDA), the Securitisation Forum of Japan (SFJ), and the Structured Finance Industry Group (SFIG).

GFMA and other associations provide comments to the Basel Committee on Banking Supervision (BCBS) requesting clarification on how the final leverage ratio framework rules should be interpreted at this stage, so as  to ensure that they are transposed correctly and consistently in national and regional implementation measures, without unintentional adverse impacts on the markets.

GFMA signed the letter with the following groups:  American Bankers Association (ABA), Futures Industry Association (FIA), Institute of International Finance (IIF), International Swaps and Derivatives Association, Inc. (ISDA), The Financial Services Roundtable (FSR),  and The Clearing House (TCH).

The Global Foreign Exchange Division (GFXD) of GFMA provides comments to the Canadian Securities Administrators' (CSA) Consultation Paper, Proposed Model Provincial Rule on Mandatory Central Counterparty Clearing of Derivatives, CSA Consultation Paper 91-303.  

The GFXD generally supports the Proposed Model Rules in their current form but wish to draw the CSA’s attention to specific areas of the Proposed Model Rules as they relate to the global FX market.

The Global Foreign Exchange Division (GFXD) of GFMA, on behalf of Bloomberg SEF LLC, ICE Swap Trade, LLC, INFX SEF, Inc.,  MarketAxess SEF Corporation,  SwapEx, LLC, TeraExchange, LLC,  360T Trading Networks Inc.,  and Thomson Reuters (SEF) LLC,  provides comments to the Division of Marketing Oversight of  Commodity Future Trading Commission (CFTC) requesting that the Division confirm that it will not recommend that the Commission commence an enforcement action against a swap execution facility (SEF) that has failed prior to January 1, 2015 to comply with the requirements of Commission regulations in connection with swap transactions executed on the SEF that are not required or intended to be submitted for clearing (Non-Cleared Swaps), provided that the SEF has complied with the conditions applicable to it under this letter.

GFXD believes that, if granted, the no-action relief (NAR) requested in this correspondence would largely mitigate the legal uncertainties that have contributed to the continued reluctance on the part of market participants to trade Non-Cleared Swaps on SEFs, and would help foster an orderly transition to the SEF marketplace for Non-Cleared Swaps as the Interdivisional Working Group completes its work.

GFMA provides comments to the International Organization of Securities Commissions (IOSCO) offering recommendations on foundational principles for global coordination in cross-border regulation. IOSCO is creating a task force aimed at addressing cross-border regulatory coordination issues (the Task Force).

GFMA is supportive of the Task Force’s stated intention of issuing a public consultation paper focused on cross-border reform efforts and hosting public industry meetings for continued dialogue; and believes IOSCO can and should play an integral role in promoting coordination. Consequently, in advance of the Task Force’s consultation paper, GFMA writes to highlight several issues currently impacting cross-border regulatory coordination, which it believes are immediately actionable by IOSCO.

GFMA prepared this presentation, which proposes a holistic an globally inclusive Regulatory Recognition Approach.  The presentation details key components of the approach, benefits, shared values and commonality of objectives, and regulatory principles.

The Global Foreign Exchange Division (GFXD) of the Global Financial Markets Association (GFMA) provides comments to the Financial Stability Board - Aggregation Feasibility Study Group of the Bank for International Settlements regarding the Consultation Paper on the Feasibility study on approaches to aggregate OTC derivatives data issued by the Financial Stability Board (FSB) on February 4th, 2014.

GFMA provides comments to all G20 Finance Ministers in Support of Global, Consistent Standards and Meaningful Regulatory Reform. This letter addresses important developments related to implementation and global consistency of the G20s regulatory reform agenda which may risk divergence from consistent implemention.

GFMA, SIFMA, The Clearing House Association L.L.C. (The Clearing House), the American Bankers Association, the Financial Services Roundtable and the Global Financial Markets Association provided comments to the Federal Deposit Insurance Corporation on their notice entitled Resolution of Systemically Important Financial Institutions: The Single Point of Entry Strategy.

The Notice describes the FDIC’s single-point-of-entry (SPOE) recapitalization within resolution strategy for resolving global systemically important banking groups (G-SIBs) with top-tier U.S. parent companies under Title II of the Dodd-Frank Wall Street Reform and Consumer Protection Act and requests comments on certain details and issues regarding how the FDIC would expect to carry out the SPOE Strategy with respect to U.S. G-SIBs.

See also:

78 FR 76614 - RESOLUTION OF SYSTEMICALLY IMPORTANT FINANCIAL INSTITUTIONS: THE SINGLE POINT OF ENTRY STRATEGY

GFMA offers this briefing note, which gives an overview of commodity trading and managing risks.

The Global Foreign Exchange Division (GFXD) of GFMA provides comments to the Securities Commission Malaysia (SC), Bank Negara Malaysia (BNM) and Perbadanan Insurans Deposit Malaysia (PIDM) (collectively the Regulatory Agencies) on the Joint Public Consultation Paper on Trade Repository Reporting Requirement for Over-the-Counter Derivatives.

Many of the current legislative and regulatory reforms will have a significant impact upon the operation of the global FX market and GFXD feels it is vital that the potential consequences are fully understood and that new regulation improves efficiency and reduces risk, not vice versa.

GFXD is supportive of the approach outlined in the joint consultation paper and provide specific comments with respect to the requirements and your questions. In addition, GFXD particularly welcomes the Regulatory Agencies' to harmonise reporting requirements under the regime with those that will apply internationally.

GFMA, as part of the The LEI Trade Association Group, a coalition of financial services firms and trade associations, provides comments to Securities Commission Malaysia (SC), Bank Negara Malaysia (the Bank), and Perbadanan Insurans Deposit Malaysia (PIDM) (Regulatory Agencies) on their Joint Public Consultation Paper: Trade Repository Reporting Requirement for Over-the-Counter Derivatives , NO. 1/2013, November 20, 2013.

The Associations strongly encourage the Regulatory Agencies to reconsider the use of the SWIFT code or company registration number for identifying Parties in trade reporting. Instead, the groups respectfully propose the adoption of the legal entity identifiers (LEIs) that are available through the Global Legal Entity Identification System (GLEIS) towards this purpose. The GLEIS, developed under the auspices of the Financial Stability Board (FSB) and endorsed by the G20, is aimed at achieving a unique, unified global system of identification of parties to financial transactions.

GFMA,  the International Swaps and Derivatives Association, Inc (ISDA), the Investment Industry Association of Canada (IIAC), ISITC Europe and the UK Investment Management Association provide comments to the European Banking Authority (EBA) on the EBA's Consultative Document on the use of the Legal Entity Identifier (LEI) for entity identification in EU regulatory reporting.

The Associations strongly agree with the EBA’s recommendation to support “the adoption of Legal Entity Identification system proposed by the Financial Stability Board (FSB) and endorsed by the G20, aimed at achieving a unique, worldwide identification of parties to financial transactions” and to call for “competent authorities [to] request that all institutions under their supervisory remit obtain a pre-LEI code” and use that LEI when providing information to the EBA concerning institutions.

The groups offer a few brief comments on the Draft Recommendation as well respond to the three questions included in the paper.

GFMA, the International Institute of Finance (IIF) and the International Swaps and Derivatives Association, Inc. (ISDA) provide further response to the Basel Committee on Banking Supervision (BCBS) relating to notional definitions for the BCBS Consultative Document, The Non-Internal Model Method for Capitalizing Counterparty Credit Risk Exposures.

The groups believe the Consulative Document is a significant step in the right direction and believe that the proposed non-internal model method (NIMM) framework has great potential. As an alternative to the current exposure method (CEM), it is clear that NIMM performs significantly better as a measure of exposure.

However, the industry feels an articulation of supervisory standards for the definition of effective notional that will allow firms to reliably and consistently apply NIMM to the vast majority of derivative structures is important. We urge the Basel Committee to articulate these standards to help ensure global consistency and a level playing field, facilitating an effective application of NIMM.

GFMA, the Institute of International Finance (IIF), The Clearing House Association L.L.C. (TCH), and the Federation of Finnish Financial Services (FFI) provide comments to the Financial Stability Board (FSB) on the FSB Common Data Template Workshop held 2-3 October 2013, which focused on Phases 2 and 3 of the FSB G-SIB Common Data Template (CDT), organized by the FSB Data Requirements Workstream (DRW).

This letter starts with a reiteration of the major themes the industry raised at the workshop, followed by detailed discussions of our comments on the Phases 2 and 3 templates.

GFMA, the International Swaps and Derivatives Association, Inc. (ISDA) and the International Institute of Finance (IIF) provide comments to the Basel Committee on Bank Supervision (BCBS) responding to the BCBS Consultative Documents: Capital Treatment of Bank Exposures to Central Counterparties (CCPs), BCBS253.  

The Associations commend the BCBS for undertaking another consultation on these proposals and desire to provide meaningful input to ensure a viable capital framework is adopted. This response focuses on elements of the consultative document that stand to motivate and influence the expansion of central clearing. The groups share concerns that the proposal discourages propagation of central clearing, in direct contrast to policy objectives stated at the G20 September 2009 summit and related regulatory initiatives such as the Dodd-Frank Wall Street Reform and Consumer Protection Act (Dodd-Frank Act) and European Market Infrastructure Regulation (EMIR). They also believe the proposal fails to provide incentives for CCPs to invest in the improvement of their risk systems and methodologies and discourages fundamental CCP risk practices, notably the intended function of the default fund.

GFMA provides comments to the Financial Stability Board (FSB) responding to the FSB Consultation Document: Application of the Key Attributes of Effective Resolution Regimes to Non-Bank Financial Institutions (Discussion Paper).  

GFMA summarises the key concerns and comments raised by GFMA members with respect to Appendix III of the Discussion Paper entitled “Client asset protection in resolution.”  Specifically, GFMA's comments focus on the definition of client assets and on client asset segregation rather than on resolution tools outlined in the Discussion Paper.

GFMA, the International Institute of Finance (IIF), the International Swaps and Derivatives Association, Inc. (ISDA), and The Clearing House (TCH) provide comments to the Financial Stability Board (FSB),  the Committee on Payment and Settlement Systems (CPSS) of the Bank for International Settlements (BIS), and the International Organization for Securities Commissioners (IOSCO) on the FSB Consultation Document: Application of the Key Attributes of Effective Resolution Regimes to Non-Bank Financial Institutions and the CPSS-IOSCO Consultative Report: Recovery of Financial Market Infrastructures (FMIs). 

Effective recovery, continuity and resolution mechanisms for FMIs are critical to the efficient operation and sustainability of the financial markets. It would be difficult, if not impossible, to maintain financial stability if essential services provided by FMI entities were to cease.

GFMA provides comments to the Basel Committee on Banking Supervision (BCBS)  on the Discussion Paper: The Regulatory Framework: Balancing Risk Sensitivity, Simplicity and Comparability.

The Discussion paper steps back from the significant regulatory reforms introduced by the Basel Committee and member jurisdictions to consider the resulting complexity in capital adequacy requirements as well as the comparability of capital adequacy ratios across jurisdictions.  The Discussion paper raises important questions about the capital adequacy framework (the Framework) including: whether reliance on risk‐based capital at the core of the Framework appropriately balances varied objectives and the extent to which the framework strikes the right balance between simplicity, comparability, and risk sensitivity.

GFMA believes that while the risk‐based capital framework is not perfect, all elements of it are sound and reflect years of study, practice, and enhancement. Further, GFMA agrees with the Basel Committee that the risk‐based capital framework must continue to evolve, and be updated frequently, to be consistent with changing markets, products, and institutions, and as understanding about how to better reflect risk in regulatory capital improves.

GFMA provides comments to the Organisation for Economic Co-operation and Development (OECD) on the OECD's Action Plan for Base Erosion and Profit Shifting (BEPS).  GFMA shares concerns that certain aspects of the Action Plan could have unintended consequences for the financial services industry. In order to minimize the risk of possible unintended effects, GFMA requests that the OECD consider the potential implications of the action items for the financial services industry.

GFMA provides comments to the Financial Stability Board (FSB) in response to the FSB's Consultative Document:Information sharing for resolution purposes, 12 August 2013.

GFMA is strongly supportive of the work of the FSB towards establishing an effective cross-border recovery and resolution framework and the Key Attributes of Effective Resolution Regimes for Financial Institutions. Cross-border cooperation is a crucial requirement for effective cross-border resolution and GFMA strongly supports efforts to strengthen and facilitate greater cross-border cooperation in this area.  In that context, GFMA shares its expertise in response to the Consultative Document.

GFMA and the Institute of International Finance (IIF) provide comments to the Co-Chairs of the Basel Committee on Banking Supervision (BCBS) Working Group on Liquidity in response to the Consultative Document on "Liquidity coverage ratio disclosure standards".

The Global Foreign Exchange Division (GFXD) of GFMA provides comments to the Commodity Futures Trading Commission (CFTC)  request time-limited relief certain provisions of CFTC regulations:  (1) Part 37 relating to swap execution facilities (SEFs); (2) Part 43 (real-time reporting); or (3) Part 45 (trade reporting) – in each case, as may be applicable to the trading of FX products on these platforms solely in connection with FX products which are not currently subject to a clearing requirement so long as such entity complies with an alternative compliance schedule.

GFMA supports continued discussions between the CFTC and swaps market participants on the best manner to timely effect the migration of swaps trading activity from existing venues to regulated SEF platforms.  However, in light of the fast approaching compliance date and the many technological, operational and legal hurdles that still need to be overcome within this short timeframe, we believe time-limited relief is warranted.

SIFMA AMG Submits Comments to the CFTC Requesting Relief Relating to SEF Implementation and Swap Trade Execution (23 September 2013)

GFMA and other Associations provide comments to the Basel Committee on Bank Supervision (BCBS) responding to the June 2013 Consultative Document issued by the BCBS , Revised Basel III leverage ratio framework and disclosure requirements (Proposed Framework).  

The Associations support the BCBS’s efforts to impose a leverage ratio as a supplemental, backstop measure to the risk-based measure.  In its current form, however, the Proposed Framework would greatly increase the denominator of the Basel III leverage ratio (the Exposure Measure) by adopting measurement methodologies that the Associations believe would significantly overstate actual economic exposure.  If adopted in this form, the Exposure Measure is far more likely to result in the leverage ratio, rather than the risk-based capital ratio, becoming the binding capital measure for a substantial number of banks.  Moreover, for banks where the leverage ratio does not become the binding ratio immediately, the very real prospect of it becoming binding in the future or after a stress test will cause these institutions to change their behavior as if it were binding. As a result, institutions will reduce their participation in core financial activities and markets that are critical to the smooth functioning of the financial system.

GFMA provides comments to the Basel Committee on Bank Supervision (BCBS) on the recognition of short positions in the calculation of capital deductions required for investments in unconsolidated financial institutions, as required under Basel III.  GFMA believes that the current Basel III wording will unintentionally restrict banks' ability to provide liquidity and carry out market making activities, and therefore ask the BCBS to reconsider the requirement.

GFMA provides comments to the European Union (EU) on EU’s legislative proposal for the regulation of benchmarks (the Regulation).

While GFMA considers that benchmark innovation, production and distribution should remain industry-driven activities, GFMA believes that internationally-agreed best practice standards, supported by appropriate regional or local regulation, are critical to promoting both investor confidence and the integrity of global financial markets.

GFMA shares concerns that the proposed Regulation could better embody the concept of proportionality imbedded in the International Organization of Securities Commissions (IOSCO) Principles. GFMA believes that the provisions of the Regulation should apply commensurately with the risks posed by a benchmark to the financial system and with the importance of a benchmark to market participants, investors and consumers.  In addition, GFMA notes that the equivalence regime approach for non-EU benchmarks, limited proposed exemptions, and demanding timelines, may need to be modified to reflect market practicalities and risks. A pragmatic approach to implementation is necessary in order to avoid confusion, uncertainty and volatility in markets, which would adversely impact EU institutions and consumers.

The Global Foreign Exchange Division (GFXD) of GFMA provides comments to the European Securities and Markets Authority (ESMA) in response to the Discussion Paper on the Clearing Obligation under the European Market Infrastructure Regulation (EMIR), ESMA/2013/926. 

Given the global nature of the Foreign Exchange (FX) market, GFMA emphasizes the importance in ensuring that the regulatory treatment of FX products in multiple, global jurisdictions remains consistent. GFMA shares its recommendations are responses to questions including the detailed rationale behind the exemption to any central clearing obligation of deliverable over-the-counter (OTC) FX forwards and swaps by the U.S. Department of Treasury. GFMA strongly recommends that ESMA follow a similar approach by not issuing a clearing obligation for such products.

GFMA letter to the Basel Committee on Banking Supervision (BCBS) and International Organization of Securities Commissions (IOSCO) regarding Swap Margin Requirements For Non-Centrally-Cleared Derivatives.

The Global Foreign Exchange Division (GFXD) of GFMA provides comments to the Canadian Securities Administrators (CSA) in response to the CSA Consultation Updated Model Rules - Derivatives: Product Determination and Trade Repositories and Derivatives Data Reporting, CSA Staff Notice 91-302.  The GFXD broadly supports the proposed approach outlined in the Updated Model Rules and, specifically, the various amendments made to reflect GFMA's earlier comments on the Draft Model Rules.  GFMA offers recommendations limited to key issues which they believe remain, or are newly raised in the CSA Consultation.

GFMA provides comments to the Office of Gas and Electric Markets (Ofgem) in repsonse to Ofgem's consultation on proposed penalties statement and procedural guidelines under the Regulation on Wholesale Energy Markets Integrity and Transparency (REMIT).  

While generally agreeing with the approach taken, GFMA believes that the following three areas could benefit from being considered further:

• the circumstances in which the Authority would exercise its power to publish information on warning notices, especially bearing in mind that the FCA is still in the process of consulting on the circumstances in which it will use similar powers;
• alignment of regulatory approaches under REMIT and under the Market Abuse Directive / Market Abuse Regulation; and
• additional details on proposed arrangements for regulatory cooperation.

GFMA and other trade associations provide comments regarding the definition of financial instruments under MiFID II to to the European Commission, European Parliament and Lithuanian Presidency. 

We and our members fully support transparency in the commodity markets and recognize the need for regulators to have accurate information to enable them to carry out their supervisory and enforcement mandates.

Letter signed and submitted on behalf of the collective memberships of the:

European Federation of Energy Traders
Futures and Options Association
Global Financial Markets Association
International Swaps and Derivatives Association

The Global Foreign Exchange Division (GFXD) of GFMA provides comments to the Canadian Securities Administration (CSA) on the CSA Consultation Paper 91-301 – Model Provincial Rules – Derivatives: Product Determination and Trade Repositories and Derivatives Data Reporting.  GFXD broadly supports the proposed approach outlined in the Model Rules and welcomes the recognition and allowances made for parties and transactions covered by the Model Rules to be reported to foreign-based trade repositories. GFXD also welcomes the efforts by the CSA to harmonise reporting requirements under the TR Rules with those that will apply internationally and the ability to apply for exemptions on the grounds of equivalency.

The Commodities Working Group of GFMA provides comments in response to the consultation in respect of the Office of Gas and Electricity Markets’ (Ofgem) call for evidence as it relates to pricing benchmarks for gas and electricity markets.

GFMA and its members believe that the integrity of benchmarks is important for market functioning and ensuring confidence in the price setting mechanisms. In November 2012, GFMA published its Principles for Financial Benchmarks to provide support and input into the regulatory dialogue on benchmarks.   GFMA advocates the need for a clear and transparent regulatory framework, including consistent regulatory treatment with those undertaking similar price reporting or price formation activities.

GFMA's response encourages Ofgem and the Financial Conduct Authority to oversee the adoption by market participants of the The International Organization of Securities Commissions (IOSCO) Principles for Oil Price Reporting Agencies (PRAs) through their formal regulatory process. This is to ensure a consistent standard across participants and maintain confidence in the marketplace.

The Global Foreign Exchange Division (GFXD) of GFMA provides comments to the Monetary Authority of Singapore (MAS) on the Consultation Paper on Draft Regulations Pursuant to the Securities and Futures Act (SFA) for Reporting of Derivatives Contracts, P006-2013-June 2013.  The GFXD is supportive of the approach outlined in the consultation paper and provide specific comments with respect to the requirements and the questions posed by the MAS. The GFXD  particularly welcomes the MAS's efforts to harmonise reporting requirements under the regime with those that will apply internationally.

GFMA provides comments to the G20 Central Bank Governors voicing strong opposition to the EU's proposed financial transaction tax (FTT).  GFMA believes that, as currently designed, the proposed FTT will harm economic growth at a time of significant economic uncertainty by increasing government and corporate borrowing costs, and will undermine the effectiveness of monetary transmission channels.  In addition, the FTT would have unprecedented extraterritorial impacts, contrary to G20 principles and commitments.  In addition, the AFTT would have unprecedented extraterritorial impacts, contrary to G20 principles and commitments.

GFMA's Global Foreign Exchange Division (GFXD) authored a briefing note on the impact of the proposed European Union Financial Transaction Tax (FTT) on Foreign Exchange (FX) markets.

The related Press Release is available at the following link:
http://www.gfma.org/News/Item.aspx?id=494

Executive Summary

 The Foreign Exchange (FX) market underpins international commerce and investment by allowing governments, businesses, investors and individuals to convert one currency to another. In addition to FX Spot transactions, other FX Products (FX forwards, NDFs, FX swaps, FX options) enable participants to transact with certainty over the exchange rate and therefore the value of the transaction, whether for issuing a bond to international investors, purchasing raw materials abroad, exporting goods overseas, or protecting the value of pension investments made in other currencies. 

Europe is focused on restarting economic growth. The ability of European companies of all sizes to remain active on the global scene - by exporting European goods while securing a stable income at home despite volatility in currency markets - is crucial to this economic growth. FX Products are central to that ability.

To preserve the usefulness of FX markets, the proposed Financial Transaction Tax (FTT) should not create barriers or prevent European companies and investors from being active in international commerce and investment. The inclusion of these FX Products in the scope of any FTT would significantly raise the cost for end-users if they are to remain active in international commerce. Our analysis shows:

• For EU corporates, their FX transaction costs will rise by up to 700%. With just a single dealer a corporate based in the tax zone could see its annual FX transactions costs rise from $2.4m to $20.4m.
• For a pension fund or fund manager, the impact is even greater, due to the double-sided nature of the proposed tax. These users could see their transaction costs rise by around 1,500% and possibly by as much as 4,700%. For a pension fund manager whose annual FX transaction costs with a single dealer are currently $1.6m, this will mean that, once taxed, transaction costs would exceed $75m.

Imposing an FTT on these FX Products (FX forwards, NDF, FX swaps, FX options) may well cause companies and investors to move away from hedging the risk of their international activities, increasing their earnings volatility and business risk or pushing up costs that will reduce returns for investors. It risks discouraging them from being active in international commerce or creating costs that are a drain on firms’ financial resources that they could otherwise have deployed to fund their growth plans.

The European Commission3 has already recognised that including FX spot transactions in the FTT would infringe the movement of capital under The Treaty on the Functioning of the European Union and in 2011 raised concerns with regards including other FX Products. Given these other FX Products are used for the same purposes as spot transactions - for payments, investing and funding - we suggest that these FX Products – FX swaps, forwards, options and NDFs - should, as is already the case in relation to FX spot transactions, be excluded from the scope of any FTT proposal.

GFMA Submits Comments to the Financial Stability Board (FSB) and the International Organization of Securities Commissions (IOSCO) on the Implementation of Market Regulations and their role.

 GFMA provides comments to the Australian Securities and Investments Commission (ASIC ) on their Consultation Paper 205: Derivative transaction reporting.

 GFMA, the Clearing House Association L.L.C., the American Bankers Association (ABA), the Financial Services Roundtable (FSR), International Swaps and Derivatives Association, Inc. (ISDA), and the Structured Finance Industry Group (SFIG) provide comments to Secretariat of the Basel Committee on Banking Supervision (BCBS) on their March 2013 Consultative Document, Supervisory framework for measuring and controlling large exposures.

GFMA provides comments to the Financial Stability Board (FSB) and the Basel Committee on Bank Supervision (BCBS) on the implementation of prudential standards.  The post‐crisis international regulatory framework represents a major step forward from that which existed prior to the financial crisis.  GFMA shares concerns that as the implementation phase begins for many of these regulatory reform initiatives, however, instances of divergence from agreed frameworks have increased. Some jurisdictions have also adopted or are considering additional reforms beyond international consensus (e.g., structural banking reforms). Inconsistent prudential standards, including variations in supervisory practices, and a trend toward regulatory fragmentation could increase regulatory arbitrage, undercut efforts to develop a credible cross‐border resolution regime, and undermine international cooperation on policymaking.

GFMA and ISDA provide comments to the Basel Committee for Bank Supervision (BCBS) responding to the BCBS Consultative Document, Recognising Cost of Credit Protection Purchased.

The groups share multiple concerns, including that, while capturing a small number of transactions deemed abusive by the regulators, the proposed rule would have a disproportionate effect on a wide range of banks' financing activities (both in corporate and investment banking), wherever banks seek to hedge borrower credit risk or associated counterparty risk. Also they believe the Committee's concern can and should be addressed by regulatory supervision, and may also be partly addressed by proposed changes to relevant accounting standards, without amendments to existing Pillar 1 capital rules.

GFMA and the International Swaps and Derivatives Conference, Inc. (ISDA) provides comments to the Basel Committee for Banking Supervision (BCBS) in response to the BCBS Consultation Document, Recognising cost of credit protection purchased (published 22 March 2013).  The groups are concerned that, while capturing a small number of transactions deemed abusive by the regulators, the proposed rule would have a disproportionate effect on a wide range of banks' financing activities (both in corporate and investment banking), wherever banks seek to hedge borrower credit risk or associated counterparty risk. In addition the groups voice concerns about synthetic securitisation transactions, non-securitisation transactions, the potential impact of changes to the accounting standards affecting loan loss reserves, and additional questions posed in the BCBS Consultation Document.

GFMA, the British Bankers' Association, the European Banking Federation, ISITC Europe, International Swaps and Derivatives Association, Inc., and the Investment Industry Association of Canada provide comments to the Financial Services Board Chairman Mark Carney.  The Associations submit comments on the need for the ROC to make important decisions at the their upcoming (11-12 June) meeting on the Mutual Acceptance for pre-LEI identifiers, as well as the development of standards for pre-Local Operating Units (LOUs).

GFMA, the British Bankers Association (BBA), ISITC Europe, the International Swaps and Derivatives Association, Inc. and the Investment Industry Association of Canada (IIAC) provide comments to the Financial Services Board Chairman Mark Carney on the necessity for mutual acceptance and interim standards for a global legal entity identifier (LEI), in advance of the June 11-12  meeting of the LEI Regulatory Oversight Committee (ROC).  

The industry is strongly supportive of a federated Global LEI System, and the benefits to financial stability that it would provide. For this goal to be met, the ROC must make important decisions to both Mutually Accept pre-LEIs, as well as develop robust standards for pre-LOUs, immediately.

Change on the scale of the US Dodd-Frank legislation and the EU programme of regulatory reform brings with it a unique opportunity to build a regulatory framework that achieves significant gains in levels of protection for customers and levels of financial stability for the global economy. 

Undertaking reform on such a significant scale also risks making changes that are broader in scope than may be necessary or which are focused purely on domestic concerns or issues whilst ignoring the impacts on wider, international financial markets. This can lead to regulation that is inappropriately extraterritorial in effect and elements of regulation that diverge significantly between major financial centres. 

This GFMA paper refers to specific examples of legislation or regulation in the US and EU which illustrate the concerns to which measures are giving rise.

This GFMA letter sets out a summary of EU legislation which has recently been proposed or which is in the process of being implemented, and which has an extraterritorial effect which may have an impact on non-EU markets and Asian markets in particular.

Extraterritoriality arises both intentionally in EU legislation (e.g., where the legislation expressly states that it is intended to apply to non-EU entities), and also unintentionally (e.g., where the territorial scope of legislation is unclear, or where obligations which apply to an EU entity may end up having an impact on that entity's clients or counterparties).

This GFMA letter sets out a summary of U.S. financial regulatory measures that have recently been proposed or are in the implementation process, which may have an extraterritorial impact on non-US markets – particularly Asian markets.  These measures are generally mandated by the Dodd-Frank Wall Street Reform and Consumer Protection Act (Dodd-Frank Act), enacted in 2010 by the U.S. Congress in response to the financial crisis that erupted in the prior years.  

GFMA, the International Swaps and Derivatives Association (ISDA), and the Institute of International Finance (IIF) provides further response to the Basel Committee on Banking Supervision (BCBS) on Consultative Document:  Fundamental Review of the Trading Book dated May 2012 (Fundamental Review or FRTB). The groups recommend reading this further response should be read in the context of the previous industry response submitted in September 2012.  

Under current BCBS Trading Book Group (TBG) proposals, the organizations feel that the ideas for standard rules may be overly prescriptive and complex because they attempt to achieve too many goals, many of which we feel may be better addressed by considering use of a standardized calibration of internal models for the purpose of benchmarking models and making cross firm comparisons. While the groups would be happy to engage further with the TBG on a recalibration of the existing standard rules approach, or indeed on the design of a new simple standard rules approach, the focus of this response is on standardization of model calibration for benchmarking purposes.

GFMA provides comments to the  International Organization of Securities Commissions (IOSCO) on IOSCO's  Consultation Report, Regulatory Issues Raised by Changes in Market Structure, published March 2013.  GFMA believes that, as securities markets evolve and new technologies continue to develop, it is critical that regulators regularly consider existing regulatory requirements, with a goal of maintaining efficient and robust market structures that protect investors while facilitating active competition among trading spaces.  GFMA provides its reactions and comments to the Consultation Report’s recommendations and questions, each from a U.S. and European markets-perspective.

GFMA provides comments to the International Organization of Securities Commissions (IOSCO) on IOSCO's Principles for Financial Benchmarks Consultation Report.  While GFMA considers that benchmark innovation, production and distribution should remain industry-driven activities, it believes that an internationally-agreed set of best practice standards is critical to promoting both investor confidence and the integrity of global financial markets.

GFMA provides a response to the Office of Gas and Electricity Markets (OFGEM) open letter on Regulation on Wholesale Energy Market Integrity and Transparency (REMIT) dated 15 March 2013.  
GFMA consistently supports EU-wide initiatives in this context (e.g. registration, data and reporting frameworks). Moreover, GFMA strongly supports the move to increasing transparency in these markets and believe that the most value will be delivered by having a single EU-wide platform for these markets which concentrates data in one place.

GFMA provides comments to the U.S. Board of Governors of the Federal Reserve System on a proposed rule, Enhanced Prudential Standards and Early Remediation Requirements for Foreign Banking Organizations (FBOs) and Foreign Nonbank Financial Companies; Docket No. R−1438; RIN 7100 AD 86.

GFMA recognizes that the profile of the U.S. operations of some FBOs has changed substantially in recent years and understands the Federal Reserve’s concerns about the financial stability risks that global financial institutions can pose to host country financial systems.  However, GFMA believes that the proposed rule will exacerbate, rather than mitigate, these financial stability risks and harm the global economy.

GFMA, the Australian Financial Markets Association (AFMA), the Investment Industry Association of Canada (IIAC), the Japan Securities Dealers Association, and the Korea Financial Investment Association (KOFIA) provide comments to all G20 financial ministers expressing their strong opposition to the EU's proposed financial transaction tax (FTT).  The groups believe the FTT would have unprecedented extraterritorial impacts, contrary to G20 principles, and would harm economic growth.

GFMA, the International Swaps and Derivatives Association, Inc. (ISDA) and the Institute of International Finance provide a further response to the Basel Committee on Banking Supervision (BCBS) on the Consultative Document:  Fundamental Review of the Trading Book dated May 2012. This paper follows the earlier paper on Diversification and Model Approval. It addresses the calibration of the two parameters presented in the previous paper; Alpha which governs diversification benefit and Beta which controls the penalty for poor model performance. The groups also submit a short paper on the use of the Kalman Filter. 

GFMA provides comments to the International Organization of Securities Commissions (IOSCO) on the consultation report entitled "Global Developments in SecuritisationRegulation" (the Consultation Report), and the corresponding proposed policy recommendations.

Securitisation market members of the Association for Financial Markets in Europe (AFME), the Securities Industry and Financial Markets Association (SIFMA) and Asia Securities Industry and Financial Markets Association (ASIFMA), working together as the Global Financial Markets Association (GFMA) provide comments to the Joint Forum in response to their July Report on Asset Securitisation Incentives.

GFMA provides comments to the Basel Committee for Banking Supervision (BCBS) requesting an extension of the comment due date of the Consultative Document on Revisions to the Basel Securitisation Framework.  GFMA appreciates the efforts of the the BCBS and its working group that produced the technical paper (the Technical Paper) and a proposed quantitative impact study (the QIS) in connection with the consultative document.  However, given the short period of time from the issuance of the Technical Paper and the QIS, and the meeting thereon, until March 15, 2013, when the comment period on the Consultative Document is due to expire, GFMA members are concerned that there is not sufficient time remaining before the Comment Due Date to adequately evaluate and comment on the Consultative Document.

GFMA provides comments to the Basel Committee for Banking Supervision (BCBS) on the Consultative Document, Revisions to the Basel Securitisation Framework published by the BCBS on 18 December 2012.  GFMA believes the starting assumptions of the Consultative Document are too narrowly drawn. The group notes that outside certain well-known and defined sectors, securitisations have performed well since the financial crisis. GFMA calls for a balanced, prudently calibrated and holistic policy response.

GFMA provides coments to the European Securities Markets Authority (ESMA) / European Banking Authority (EBA) responding to the Consultation Paper on Principles for Financial Benchmarks - Setting Processes in the EU.

GFMA supports the work of both ESMA and the EBA in developing a framework of principles for benchmarks used extensively in financial markets.

GFMA paper provided to the Basel Trading Book Group (TBG)in response to the BCBS consultative document: Fundamental Review of the Trading Book. 

The paper addresses the issues of diversification and model approval; te paper attempts to assist the Basel Committee in achieving their aims of having a more granular model approval framework.

GFMA provides comments to the International Organization of Securities Commissions (IOSCO) on IOSCO's Consultation Document on Financial Benchmarks.   GFMA attaches particular importance to this initiative and will work with IOSCO to ensure that the standards developed have broad applicability proportionate to the significance of the benchmark and are adopted widely in the industry. In addition to IOSCO’s consultation, GFMA notes and welcomes the Wheatley Review, the work of the European Parliament, the European Commission, EBA and ESMA, and discussions at the FSB on benchmarks.
 

The Global Foreign Exchange Division (GFXD) of GFMA provides comments to the U.S. Commodity and Futures Trading Commission (CFTC) on on the proposal made by the Chicago Mercantile Exchange Inc. (CME) in its amended submission # 12-391R dated December 6, 2012, which requests the CFTC to approve of a new Chapter 10 and Rule 1001 (the Proposed Rule) of the CME's Swap Data Repository (SDR) rulebook.

GFMA believes that the CFTC should not approve the Proposed Rule for multiple reasons, including that the Proposed Rule, which would require all swaps cleared with the CME to be reported to the CME's SDR, violates the “fair and open access” principle of the Dodd-Frank Wall Street Reform and Consumer Protection Act (Dodd-Frank Act).

GFMA emphasizes that the concerns raised in this letter are not exclusive to the CME and the Proposed Rule, but apply generally to any designated clearing organization (DCO) that seeks to require all swaps cleared with it to be reported to a specific swap data repository (SDR). 

GFMA provides comments to the Financial Stability Board (FSB) on the Consultative Document, Recovery and Resolution Planning: Making the Key Attributes Requirements Operational.
GFMA strongly agrees with the objective of the Consultative Document, and appeciates the FSB’s efforts to monitor and assess how well the Key Attributes are being complied with across jurisdictions.  In addition, GFMA believes that progress on orderly resolution regimes should reduce the amount of any applicable G-SIFI surcharge. If a G-SIFI is resolvable, then the need for a surcharge premised on the lack of resolvability is substantially decreased and therefore any surcharge should be commensurably reduced.

GFMA provides comments to the European Commission (EC) on the EC Stakeholder Consultation on the implementation of a data and transaction reporting framework for wholesale energy markets.  In July, GFMA sent a letter to the Agency for the Cooperation of Energy Regulators (ACER) regarding its REMIT Data Collection Public Consultation Paper.  In this correspondence, GFMA responds to the EC's additional questions and offers details on where GFMA's position changed since July.

GFMA has developed best practice standards for conducting benchmark price assessments that would serve to enhance confidence in such assessments and, more generally, would promote both the integrity and efficiency of the global financial markets. GFMA first issued its principles in preliminary form in September, and refined them based on a series of discussions with various benchmark participants on their clarity and practicality. The refinements were also informed by regulatory reports, including the Wheatley Review and the recent EC consultation as well as the IOSCO review of benchmarks in the commodities markets.

Read GFMA's Preliminary Version of Principles for Financial Benchmarks 
                                                                                                                    - 7 September 2012

The Global Foreign Exchange Division (GFXD) of GFMA provides comments to the U.S. Department of Treasury (Treasury) on Treasury's determination (Proposed Determination) to exempt foreign exchange swaps and forwards from the definition of a “swap” under the Commodity Exchange Act (the CEA) pursuant to the authority granted to the Secretary of Treasury under the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010 (the Dodd-Frank Act).  The GFXD offers its observations in support of the Proposed Determination.

The Global Foreign Exchange  Division (GFXD) of GFMA provides comments to the U.S. prudential regulators on the proposed margin and capital requirements for covered swaps entities, Board Docket No. R-1415, OCC-2011-0008, FDIC RIN 3064-AD79, FHFA RIN 2590-AA45, FCA RIN 3052-AC69.  The Board of Governors of the Federal Reserve, the Federal Deposit Insurance Corporation, the Federal Housing Finance Agency, the Office of the Comptroller of the Currency, and the Farm Credit Administration (collectively, the Agencies) have reopened the comment period on the Proposed Margin Rule in light of the consultative document on margin requirements for non-centrally-cleared derivatives (Consultative Document)  published for comment by the Basel Committee on Banking Supervision (“BCBS”) and the International Organization of Securities Commissions (IOSCO).  Since GFMA believes the Dodd-Frank Act achieves the correct policy outcome with respect to foreign exchange swaps and foreign exchange forwards, the group asserts that extending a margin regime for uncleared swaps to these two foreign exchange products as contemplated by the Consultative Document is not appropriate, and is not consistent with the established and proven strategy of central banks, in consultation with supervisors, for addressing systemic risk in this market. 

GFMA and the International Swaps and Derivatives Association, Inc. (ISDA) provide comments to the Basel Committee on Banking Supervision (BCBS) and the International Organization of Securities Commissions (collectively “CPSS-IOSCO”) and requests clarification on aspects of the interim framework for the capitalisation of bank exposures to central counterparties. The groups believe that clarifying the issues noted will contribute to timely and efficient local implementation of BCBS 227 of July 2012.

GFMA provides comments to the Committee on Payment and Settlement Systems (CPSS) and the Technical Committee of the International Organization of Securities Commissions (IOSCO) in response to the Recovery and Resolution Consultative Report.

The Global Foreign Exchange Division of GFMA provides comment on the consultative document on margin requirements for non-centrally-cleared derivatives issued by the Basel Committee on Banking Supervision (BCBS) and the International Organization of Securities Commissions (IOSCO) joint Working Group on Margin Requirements (WGMR).

The Global FX Divsion of GFMA provides responses to the Canadian Securities Administrators (CSA) on the CSA Consultation Paper 91-406 –Derivatives: OTC Central Counterparty Clearing (20 June 2012).  In addtion to its comments, the Global FX Division notes that many of the current legislative and regulatory reforms will have a significant impact upon the operation of the global FX market and we feel it is vital that the potential consequences are fully understood and that new regulation improves efficiency and reduces risk, not vice versa.

GFMA, the Institute of International Finance (IIF), the International Banking Federation (IBFed), and The Clearing House Association L.L.C. (TCH) submit comments to the Basel Committee on Bank Supervision (BCBS) on the BCBS's consultative document on Principles for Effective Risk Data Aggregation and Risk Reporting.  The groups applaud the collaborative approach between the offical and private sectors, and offer additional views and comments on the consultative document.

GFMA provides comments to the Secretariat of the Basel Committee on Banking Supervision (BCBS) on their consultative document regarding monitoring indicators for intraday liquidity management. GFMA supports the BCBS’s ongoing efforts to promote enhanced intraday liquidity risk management practices and supervisory tools originally outlined in Principal 8 of the BCBS’s Principles for Sound Liquidity Risk Management and Supervision (September 2008).
 

Members of the Commodities Working Group of the GFMA provide comments to the International Organization of Securities Commission's (IOSCO) Consultation Paper on the Functioning and Oversight of Oil Price Reporting Agencies.  Members are keen to maintain an active dialogue with IOSCO throughout the process of consultation, and would therefore like to offer some constructive comments in the hope it will serve as part of that ongoing dialogue.

GFMA, the International Swaps and Derivatives Association, Inc. (ISDA) the Institute of International Finance (IIF) and the International Banking Federation (IBFed) provide comments to the Basel Committee on Banking Supervision (BCBS) Consultative Document: Fundamental Review of the Trading Book dated May 2012.  The Associations offer this first set of responses, and look forward to an ongoing productive dialogue, while continuing to support the BCBS in its efforts to strengthen and improve the regulatory treatment of the Trading Book.

On May 23, 2013, GFMA, the International Swaps and Derivatives Association, Inc. (ISDA), and the Institute of International Finance (IIF) provide further response to the Consultative Document.

GFMA has developed best practice standards for conducting benchmark price assessments that would serve to enhance confidence in such assessments and, more generally, would promote both the integrity and efficiency of the global financial markets. 

Read GFMA's Updated Principles for Financial Benchmarks  - 30 November 2012

GFMA provides comments to the Commodity Futures Trading Commission (CFTC) on the Proposed Interpretive Guidance on the Cross-Border Application of Certain Swaps Provisions of the Commodity Exchange Act (RIN 3038–AD57) and the Proposed Exemptive Order Regarding Compliance with Certain Swap Regulations (RIN 3038–AD85).

The Global Foreign Exchange Division (GFXD) of GFMA provides comments to the European Securities Markets Authority (ESMA) on the the Discussion Paper relating to draft technical standards for the regulation of OTC derivatives, central counterparties (CCPs) and trade repositories.

GFMA provides comments to the Secretariat of the Basel Committee on Banking Supervision on the recent consultative paper, A framework for dealing with domestic systemically important banks (the D-SIB framework). 

The Commodities Working Group of GFMA provides comments to the Agency for the Cooperation of Energy Regulators (ACER) regarding the REMIT Data Collection Public Consultation Paper (CP).  GFMA's responses to the CP and raise some points, which GFMA considers need clarification in order to develop a clear and robust regime. 

The Global FX Division (GFXD) of GFMA provides comments to the The Treasury of the Commonwealth of Australia on the implementation of a framework for Australia’s G20 over-the counter derivatives commitments (Consultation Paper, April 2012).  Many of the current legislative and regulatory reforms will have a significant impact upon the operation of the global FX market and the GFXD feels it is vital that the potential consequences are fully understood and that new regulation improves efficiency and reduces risk, not vice versa. The GFXD is committed to ensuring a robust, open and fair market place and shares its views in response to the  consultation paper.

GFMA and the International Swaps and Derivatives Association, Inc. (ISDA) provide comments to the Committee on Payment and Settlement Systems (CPSS) and the Technical Committee of the International Organization of Securities Commissions’ (IOSCO) regarding two consultative reports related to the CPSS-IOSCO Principles for Financial Market Infrastructures (the FMI
Principles): the Disclosure Framework for Financial Market Infrastructures (the Disclosure Framework) and the Assessment Methodology for the Principles for FMIs and the Responsibilities of Authorities (the Assessment Methodology).  The groups believe the FMI Principles will have the effect of establishing strong foundations for the global financial infrastructure and support longterm stability to the extent they are diligently observed.  In that spirit, GFMA and ISDA offer their comments regarding the guidelines.

GFMA and the Institute for International Finance (IIF) provide comments to the Finacial Stability Board (FSB) on the G-SIB Common Data Template (CDT) proposal.  The groups encourage the FSB to:

• Formally adopt principles that should guide information collection
• Form an industry advisory group to facilitate dialogue with the industry on the development of the data template
• Launch the common data template using an observation period
• Clarify and consult on the governance arrangements regarding use and confidentiality of the data
• Consider forming a permanent supervisory reporting board to oversee international data initiatives

The Global FX Division of GFMA and the American Bankers Association (ABA) provide comments to multiple U.S. federal regulators requesting clarification or, in the alternative, relief regarding certain foreign exchange (FX) transactions with counterparties that are not within the definition of “eligible contract participants,” or “ECPs,” under the Commodity Exchange Act. Specifically, the groups ask that the U.S. federal regulators confirm that FX transactions that are solely incidental to, and are initiated for the sole purpose of permitting a client to complete a transaction in, a foreign security are not subject to the regulators’ retail FX rules developed to comply with the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010 (Dodd-Frank Act).

The Global FX Division provides comments to the Canadian Securities Administrators on their Consultation Paper 91-401 on Over-The -Counter Derivatives Regulation in Canada.  GFMA responds to those questions in the Consultation Paper, where they have a specific comment to make in regard to the foreign exchange (FX) market.

The Global FX Division provides comments to the Commodity Futures Trading Commission (CFTC) on confirmation, portfolio reconciliation and portfolio compression requirements for swap dealers and major swap participants, RIN 3038-AC96 – 17 CFR Part 23.  The proposal would implement provisions of Title VII of the Dodd-Frank Wall Street Reform and Consumer Protection Act (Dodd-Frank Act).  The Global FX Division notes there are some specific challenges that face the foreign exchange industry when compared to other asset classes, namely the high volume of transactions and the wider universe of participants. These arise because the foreign exchange market forms the basis of the global payments system. These two issues provide a practical challenge in ensuring that all relevant trades and counterparties are able to comply with any proposed rules.

GFMA provides comments to the Agency for the Cooperation of Energy Regulators (ACER) regarding the REMIT Registration Format Public Consultation Paper (CP).  GFMA is supportive of the single EU registration process and of ACER’s role in collating the data and publishing a register (with commercially sensitive information removed). GFMA highlights certain issues, and in particular raises some concerns that it has regarding REMIT Registration as described in the CP.

GFMA provides comments to the Secretariat of the Basel Committee on Banking Supervision (BCBS) on the consultative document:  Principles for the supervision of financial conglomerates.  GFMA supports the development of consistent and effective supervision of global financial firms, and welcomes the work of the Joint Forum on strengthening the supervision of financial conglomerates (FCs).

GFMA provides comments to the Commodity Futures Trading Commission (CFTC) on real-time public reporting of swap transaction data, RIN 3038-AD08 – 17 CFR Part 43. In the proposed rulemaking, the CFTC asks for specific data and analysis to support the block trades proposal. At this time, it is difficult to provide such statistical analysis given that there are no central bodies responsible for collecting sufficiently granular detail – an issue that swap data repositories (SDRs) are in part intended to address. GFXD therefore advocates an approach that allows the CFTC flexibly to assess the appropriate methodologies for determining swap categories, block sizes and cap sizes.

GFMA provides comments to the Risk Management Group (RMG) of the Bank for International Settlements (BIS) on the Basel CCP framework filed regarding Capitalisation of Default Fund Exposures and Hypothetical Capital Methodologies 
 

The Commodities Working Group of GFMA provides comments to the Financial Services Authority (FSA) on the Consultation Paper: Regulating Bidding for Emissions Allowances under Phase Three of the EU Emissions Trading Scheme (CP12/16).  GFMA is supportive of the EU Emissions Trading Scheme (ETS) and welcomes Phase III as an important step towards increasing the efficiency of allocating emission allowances. This correspondence highlights two points in relation to the resultant two tier regulatory approach.

GFMA, the International Banking Federation (IBFed), the International Swaps and Derivatives Association (ISDA), and The Financial Services Roundtable (FSR) provide comments to the U.S. Department of Treasury and the European Commission, in advance of the G-20 meeting, on the problems that extraterritorial legislation poses for markets, clients and regulators.   While groups welcome the ongoing discussions among U.S. and EU finance officials and relevant regulators to coordinate their respective regulatory reforms, a strong concern continues to be the emphasis on equivalency. In addition, the groups advise that standards of comparability should be outcomes based, and not used as a tool to export regulations from one jurisdiction to another.  

GFMA provides comments to the European Securities and Markets Authority (ESMA) on the discussion paper regarding draft technical standards for the regulation of OTC derivatives, central clearing counterparties (CCPs) and trade repositories.  Many of the current legislative and regulatory reforms will have a significant impact upon the operation of the global FX market and we feel it is vital that the potential consequences are fully understood and that new regulation improves efficiency and reduces risk, not vice versa.

GFMA provides comments to the Monetary Authority of Singapore (MAS) the consultation paper issued regarding the proposed regulation of OTC Derivatives.  Many of the current legislative and regulatory reforms will have a significant impact upon the operation of the global foreign exchange (FX) market and we feel it is vital that the potential consequences are fully understood and that new regulation improves efficiency and reduces risk, not vice versa.

GFMA provides comments to the Office of Gas and Electricity Markets (Ofgem) and the Association for Co-operation of Energy Regulators (ACER) on the requirements under the Regulation on Energy Market Integrity and Transparency (REMIT) to publish inside information.  GFMA offers recommendations as part of an ongoing dialogue with Ofgem and with ACER throughout the process of implementation of REMIT.

The Global FX Division of the Global Financial Markets Association (GFMA) provides comments to the Monetary Authority of Singapore (MAS) on the MAS Consultation Paper on Proposed Regulations of over-the-counter (OTC) derivatives.  GFMA believes that many of the current legislative and regulatory reforms will have a significant impact upon the operation of the global FX market and feels it is vital that the potential consequences are fully understood and that new regulation improves efficiency and reduces risk, not vice versa.

GFMA provides comments to the Basel Committee on Banking Supervision (BCBS) on proposed Pillar 3 disclosure requirements for remuneration. GFMA believes in the disclosure of compensation information to supervisors and public disclosure of certain qualitative information to the public to the extent that it enhances prudent risk management.

Related Item: SIFMA Comments to the Basel Committee on Banking Supervision on Pillar 3 Disclosure Requirements for Remuneration 

GFMA with their European affiliate, the Association for Financial Markets in Europe (AFME),  authored a briefing note on Global Systemically Important Financial Institutions.

Introduction 

Global Systemically Important Financial Institutions, or G-SIFIs, have become an area of focus for international policymakers.  The G20 is driving the development of a new regulatory framework at a political level and has tasked various agencies with creating more detailed approaches.  The concern of policymakers is that G-SIFIs are too-big-to-fail, potentially forcing taxpayers to bear the costs of any failures.           

The policy framework for banks classified as G-SIFIs (known as Global Systemically Important Banks, or G-SIBs) has been developed more quickly than for other parts of the financial sector.  The initial list of G-SIBs has been published (see box below) using a methodology developed by the Basel Committee (BCBS).  These banks face new capital requirements and are required to develop resolution plans, while the Financial Stability Board (FSB) has consulted on an enhanced data template for G-SIBs.

While the Global Financial Market Association (GFMA), of which AFME is a member, strongly supports the goal of the Basel Committee to promote financial stability, GFMA has a number of concerns with the proposed G-SIB capital buffers including: whether the benefits exceed the cost of reduced economic growth, the lack of clear and well-defined offsets against the capital buffers for improved resolution regimes, and transparency and methodological issues.

GFMA provides comments to the Secretariat of the Basel Committee on Banking Supervision (BCBS) in response to the Consultative Document: Definition of capital disclosure requirements, 19 December 2011. 

GFMA believes the BCBS focus on post-2018 capital disclosures, taking more time to agree on the specific modalities of that disclosure, and not implement the transitional template. GFMA makes this suggestion for reasons including:

• The value of the transitional templates are compromised by the uneven pace of implementation of rules governing Basel III, as well as revisions to and uncertainties about risk-weighted asset calculations.
• It is difficult to evaluate the impact of this proposal without understanding the bigger picture of upcoming Pillar 3 revisions, as well as additional reporting and disclosure that will result from other international policy initiatives.
• This proposal, as with any other reporting and disclosure proposals, should be subject to a cost/benefit review. One step that clearly reduces costs and enhances benefits is to ensure data definitions are harmonized where possible, within and across templates.

GFMA provides comments to U.S. Treasury Secretary Geithner and E.U. Commissioner Barnier regarding extraterritorial legislation. 

The letter is sent in advance of Commissioner Barnier’s trip to the U.S. The letter aims to draw attention to the numerous extraterritorial issues, both new and previously raised, that risk negatively affecting members and their clients.
 

GFMA as part of the coalition of financial services firms and trade associations provide comments to the Australian Securities & Investments Commission’s (ASIC) in response to their consultation paper on market integrity rules,  ASIC Consultation Paper 168 Australian equity market structure.

The Trade Associations are pleased to note that ASIC’s paper recognizes the importance of developing a globally accepted legal entity identifier (LEI) and the progress made by the financial services industry and global regulators in developing a global LEI standard and solution.
 

GFMA's European affiliate, the Association for Financial Markets in Europe (AFME), authored a briefing note on the European Commission's 2010 review of the Markets in Financial Instruments Directive (MiFID), specifically in regards to transparency in foreign exchange derivatives.

Background: 

As part of its 2010 review of the Markets in Financial Instruments Directive (MiFID), the European Commission is expected to propose legislation extending transparency requirements into the non‐equities markets. The Committee of European Securities Regulators (CESR) will provide technical advice to the Commission in the context of non‐equities markets transparency and has consulted on the following markets: Corporate Bonds, Structured Finance products (ABS and CDOs), Credit Default Swaps (CDS) and Derivatives (Interest Rate, Equity, Commodities and Foreign Exchange).

AFME’s general position on all aspects of non‐equities transparency apart from structured finance is set out in Briefing Paper [BN10‐03]. This paper specifically covers the market in Foreign Exchange (FX) Derivatives.

GFMA provides comments to the Office of Gas and Electricity Markets (Ofgem) on the potential impact of the Regulation on Energy Market Integrity and Transparency (REMIT) on the commodity markets.

SIFMA, as part of the Coalition of Financial Services Firms and Trade Associations, provides comments to the Hong Kong Monetary Authority (HKMA) on developing a global legal entity identifier (LEI) standard and solution. This is in response to the July 2011 Consultation Paper on Logistical and Technical Arrangements for Reporting to Hong Kong Trade Repository (HKTR).

SIFMA is the independent U.S. regional member of the Global Financial Markets Association (GFMA).  

The Global Foreign Exchange Division (GFXD) welcomes the opportunity to comment on the Hong Kong Monetary Authority (HKMA) consultation regarding the Hong Kong Trade Repository (HKTR). On behalf of its members, the GFXD would like to take the opportunity to comment on a number of issues around the implementation of a trade repository for foreign exchange transactions and to continue our recent discussions with you in more detail with the aim of aligning and coordinating development work as closely as possible to the benefit of both regulators and industry.

 SIFMA, The Clearing House Association L.L.C. (TCH), the Enterprise Data Management Council (EDM Council), the Financial Services Roundtable (FSR), the Futures Industry Association (FIA), the International Swaps and Derivatives Association, Inc. (ISDA), the Investment Company Institute (ICI), and the Managed Funds Association (MFA) provide comments to the U.S. Department of Treasury on the Department's Statement on Legal Entity Identification for Financial Contracts (LEI Statement). The associations offer their experience and expertise to help the Treasury Department's Office of Financial Research (OFR) and other U.S. and foreign regulators develop and establish a system of uniform legal entity identifiers (LEIs). The associations believe a system of uniform LEIs will help Treasury carry out the mandate of the Dodd-Frank Wall Street Reform and Consumer Protection Act (Dodd-Frank Act) for Treasury to measure and evaluate systemic risk in the financial system.

SIFMA is the independent U.S. regional member of the Global Financial Markets Association (GFMA). The Association for Financial Markets in Europe (AFME) and the Asian Securities and Financial Markets Association (ASIFMA) represent the independent European and Asian regional members of GFMA.

The Global Foreign Exchange Division (GFXD) and Managed Funds Association (MFA) are concerned the proposed eligible contract participant (ECP) definition will cause substantial disruptions to markets and investors. 

See Also: GFMA and MFA Submit Comments to the CFTC and SEC on Safe Harbor Provisions for the Definition of Eligible Contract Participants (19 January 2012) 

GFMA’s Global Foreign Exchange Division (GFXD) and the Managed Funds Association (MFA) submit a proposed safe harbor to the CFTC’s proposed rule interpreting the definition of “eligible contract participant” (ECP) contained in the Commodity Exchange Act (the “CEA”). We urge the CFTC and the SEC to adopt the Proposed Safe Harbor as a new final paragraph of the Proposed CFTC ECP Rule.

See also: GFMA and MFA Submit Comments to the CFTC and SEC on the Definition of Eligible Contract Participant (10 January 2012) 

GFMA provides comments to the Secretary of the Federal Reserve System, Federal Deposit Insurance Corporation (FDIC) and the Office of the Comptroller of the Currency regarding a request for different standards for “Professional” retail foreign exchange investors and the right to opt-in under the new retail forex rules.

The Global FX Division authored a briefing note on the European Commission's proposed regulation on OTC derivatives, central counterparties and trade repositories, specifically in regards to the treatment of FX instruments under EMIR.

Introduction:

This note sets out the position of the Global FX Division of AFME, SIFMA and ASIFMA regarding the treatment of FX instruments under the proposed regulation covering OTC derivatives, central counterparties and trade repositories, commonly known as EMIR.

With a turnover of some EUR2.9 trillion / US$4 trillion per day the FX market is the world’s largest financial market. It is the means by which cross border payments are effected and currency risk is managed in the world’s financial system. It differs from the OTC derivative markets in that it has many more participants and transactions, which are much simpler and short term. We are therefore concerned with treating the vast majority of FX transactions, which are simple exchanges of currency, as if they are “derivatives”.

GFMA's European affiliate, the Association for Financial Markets in Europe (AFME), authored a briefing note on the Markets in Financial Instruments Directive (MiFID), specifically in regards to foreign exchange.
 

Introduction:
 

The Markets in Financial Instruments Directive (MiFID) was designed to bring efficiency to the European Equity market through competition and to ensure that investor protection was consistently achieved across national boundaries. The MiFID review has now been significantly expanded and introduces new requirements for non‐equity products.

FX trading is a 24‐hour market that underpins international trade and investing. The $4 trillion per day market, its ubiquitous nature, and the simplicity of the vast majority of products mean that it has already developed into a highly transparent, liquid and deep marketplace. Market structures have similarly evolved to ensure access, transparent pricing and end user choice. Preserving these aspects are key to ensuring that such end users are able to hedge commercial risks efficiently and in a bespoke manner.

The proposed application of MiFID to FX should be carefully considered in the light of the market’s global nature and structure and that many of the objectives of MiFID are already met by the market.

We are concerned that a broad expansion of ‘equities‐style’ regulation to capture FX raises the risk of unintended consequences. We urge the Commission to review MiFID’s objectives in the specific context of the FX market to ensure that any measures are appropriately and efficiently tailored.

The Association for Financial Markets in Europe (AFME) welcomes this consultation paper from the Committee of European Securities Regulators on standardisation and exchange trading of OTC derivatives, and the opportunity to respond. AFME’s Foreign Exchange (FX) Division comprises 21 global FX market participants, collectively representing more than 85% of the FX market.

The FX market is the world’s largest financial market. Effective and efficient exchange of currencies underpins the world’s entire financial system. As many of the current proposals may have a significant impact upon the operation of the global FX market it is vital that the potential consequences of regulatory action are fully understood and that new regulation improves efficiency and reduces risk, not vice versa.

We are aware of the joint response to this paper being submitted by AFME, BBA, ISDA, ASSOSIM and the NSA and are supportive of the views set out in their paper. We have sought here to focus on responses to the points within the consultation paper that are of particular relevance to the FX market.

 GFMA provides comments to the Bank for International Settlements (BIS)and the International Organization of Securities Commissions (IOSCO) on the March 2011 Committee on Payment and Settlement Systems and the Technical Committee of the International Organization of Securities Commissions consultative report on principles for financial market infrastructures.

This discussion note focuses on the proposals under consideration by the FSB and the Basel Committee on Banking Supervision (BCBS) relating to the establishment of additional loss absorbing capacity for SIBs.

The Global Foreign Exchange Division (GFXD) welcomes the opportunity to comment on the Canadian Securities Administrators Consultation Paper 91-402 regarding trade repositories. On behalf of its members, the GFXD would like to take the opportunity to set out a number of issues around the implementation of a trade repository for foreign exchange transactions and to respond on the specific questions raised in the document. The GFXD would also welcome the opportunity to discuss these in more detail with you with the aim of aligning and coordinating development work as closely as possible to the benefit of both regulators and industry.

Australian Financial Markets Association, Enterprise Data Management Council, European Banking Federation, European Fund and Asset Management Association, Futures Industry Association (FIA), Global Financial Markets Association (GFMA), International Bankers Association of Japan, International Banking Federation, International Council of Securities Associations, International Swaps and Derivatives Association, Inc. (ISDA), Investment Company Institute (ICI), Investment Industry Association of Canada, Securities Market Practice Group, SIFMA, The Clearing House Association and The Financial Services Roundtable provide comments to all G-20 Finance Ministers on Uniform and Global Legal Entity Identifier/To Enhance Supervisory and Industry Ability To Monitor and Evaluate Systemic Risk.

The Global Foreign Exchange Division (GFXD) welcomes the opportunity to comment on behalf of its members on the Hong Kong Monetary Authority (HKMA) and Securities and Futures Commission (SFC) consultation on the proposed regulatory regime for OTC derivatives.

The FX market is the world’s largest financial market. Effective and efficient exchange of currencies underpins the world’s entire financial system. Corporations and investors regularly participate in the market for operational needs: to reduce risk by hedging currency exposures; to convert their returns from international investments into domestic currencies; and to make cross-border investments and raise finance outside home markets.

GFMA provides comments to the Secretariat of the Basel Committee on the July 19, 2011 consultative document: “Global Systemically Important Banks: Assessment Methodology and the Additional Loss Absorbency Requirement."

The Global Financial Markets Association (GFMA), The Clearing House Association (TCH), the American Bankers Association (ABA), The Financial Services Roundtable (FSR), the Institute of International Bankers (IIB), and the Institute of International Finance (IIF) collectively, welcome the opportunity to comment on the Consultative Document on Effective Resolution of Systemically Important Financial Institutions published by the Financial Stability Board (FSB) on July 19, 2011 (Consultative Document).

The groups strongly agree with the overall objective of the Consultative Document – that authorities in all relevant jurisdictions should have the capacity to resolve systemically important financial institutions (“SIFIs”) without systemic disruption and without exposing the taxpayer to the risk of loss, within a reasonable timeframe. Taxpayer-funded bailouts have been chosen in the past, including during the recent global financial discrimination will be an impediment to cross-border resolutions of G-SIFIs. Instead, foreign and domestic deposits, and foreign and domestic depositors, should be treated as a single class in any depositor preference law.

GFMA, American Bankers Association (ABA), The Clearing House, and the Financial Services Roundtable provide comments to the Financial Stability Board on the Consultative Document: Understanding Financial Linkages: A Common Data Template for Global Systemically Important Banks, 6 October 2011.

On 28th September 2011 European Commission President José Manuel Barroso unveiled the EU Commission’s proposal for an EU wide Financial Transaction Tax (FTT) which would take effect from 1st January 2014. The tax would be levied on all securities and derivative transactions executed within the EU. For Foreign Exchange (FX) instruments spot has been exempted from taxation, however cash (defined as FX forwards and swaps) and derivatives (defined as options) have been included.

 This study evaluates the impact of the proposed EU Financial Transaction Tax on European FX markets. We aim to quantify the impacts of the FTT on FX cash and derivative markets, both in terms of the transaction costs and the effects on the participants in these markets. Previous studies have shown that introducing an FTT results in the primary impacts of an increase in the cost to transact, geographic relocation of trading, substitution and a general reduction in notional turnover. In addition, the secondary impacts are a reduction in liquidity and increased market inefficiencies. This can lead to an increase in short-term price volatility and widening bid/ask spreads.

 

The Global Foreign Exchange Division (‘GFXD’) welcomes the opportunity to comment on
Gretai’s recently issued specifications document for a cross-asset class trade repository. On behalf of its members, the GFXD would like to take the opportunity to comment on a number of issues around the implementation of a trade repository for foreign exchange transactions and to discuss these in more detail with you with the aim of aligning and coordinating development work as closely as possible to the benefit of both regulators and industry.

The GFXD welcomes the goals of enhancing regulatory oversight and promoting greater
transparency. It is working with its members to implement a trade repository for the FX industry that aims, to the greatest extent possible, to meet global regulatory needs.

Its members recently announced their recommendation to partner with DTCC and Swift to develop a global foreign exchange trade repository. This selection was the result of an extended evaluation, Request for Information (RFI) and public Request for Proposal (RFP) process that began back in December 2010, with the RFP issued in April 2011.

The project is currently in the scoping phase and key work areas will cover overall functionality, technology, connectivity, messaging and data formats amongst other areas. However, this must crucially be framed in the context of understanding how the needs of multiple regulators can be met. The GFXD would welcome the opportunity to discuss this in more detail with you.

The Global Foreign Exchange Division welcomes the opportunity to submit comments to the Reserve Bank of Australia regarding the OTC Derivatives Central Clearing Consultation Discussion Paper dated June 2011.

The discussion document seeks comment with regard to whether central clearing is appropriate for certain classes of derivatives. In respect of foreign exchange transactions, we have significant concerns about introducing any clearing requirement and welcome the Council agencies’ recognition that clearing may only be appropriate for certain, limited, FX products, namely options. Even with respect to options, we believe it is unclear whether the FX options market, given its size in Australia, poses sufficient systemic risk to justify implementation of a local CCP. We also agree with the Council agencies’ belief that products subject to a clearing mandate should, as much as possible, be harmonised with other jurisdictions’ requirements. This is particularly relevant given the global nature of the FX market and the level of trade conducted with off-shore market participants.

Ultimately, we believe that these transactions, and in particular FX forwards and swaps, should be excluded from the requirements of mandatory clearing. We believe the applicability of clearing to the FX options market requires further analysis, in terms of the structure of any CCP and the potential risk and liquidity requirements associated with it. The FX industry has been working with regulators, central banks and CCPs in the context of the CPSS IOSCO Principles for Financial Market infrastructures to understand the key challenges faced in clearing FX options in order to help inform market solutions in this regard.

The Global FX Division (“Global FX Division”) of SIFMA, AFME and ASIFMA appreciates the opportunity to share our views on the appropriateness of an exemption for foreign exchange (“foreign exchange” or “FX”) swaps and foreign exchange forwards from the definition of a “swap” under the Commodity Exchange Act (the “CEA”) pursuant to the authority granted to the Secretary of the Treasury (the “Secretary”) under the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010. For the reasons discussed in this letter, we strongly believe that an exemption is warranted.

The Association for Financial Markets in Europe (AFME) welcomes this consultation paper from the European Commission on derivatives and market infrastructures, and appreciates the opportunity to respond. AFME’s Foreign Exchange (FX) Division comprises 21 global FX market participants, collectively representing more than 85% of the FX market.

The FX market is the world’s largest financial market, and effective and efficient exchange of currencies underpins the world’s entire financial system. As many of the current legislative proposals may have a significant impact upon the operation of the global FX market it is vital that the potential consequences of regulatory changes are fully understood, and that new regulation improves efficiency and reduces risks, not vice versa. The following comments summarise our observations on the points within the consultation paper that are of particular relevance to the FX market.

GFMA provides comments to the Chairman of the Basel Committee regarding Basel 3 framework: outstanding issues on Basel III standards and processes.

SIFMA, American Bankers Association (ABA), Asia Securities Industry and Financial Markets Association (ASIFMA), Association for Financial Markets in Europe (AFME), The Clearing House Association, The Financial Services Roundtable, Investment Company Institute (IC), International Swaps and Derivatives Association, Inc. (ISDA), and International Bankers Association of Japan send comments to all G-20 Finance Ministers regarding enhancing supervisory and industry ability to monitor and evaluate systemic risk. The Trade Associations letter indicates their joint support for the development of a uniform and global "legal entity identifier" (LEI).

SIFMA is the independent U.S. regional member of the Global Financial Markets Association (GFMA). The Association for Financial Markets in Europe (AFME) and the Asian Securities and Financial Markets Association (ASIFMA) represent the independent European and Asian regional members of GFMA.

GFMA and other associations provide a LEI update to International Regulators. This is a follow-up to the September 2011 FSB LEI workshop.

The coalition of financial services firms and trade association includes: SIFMA, the Enterprisers Data Management Council, European Banking Federation, European Fund and Asset Management Association, Futures Industry Association, Global Financial Markets Association (GFMA), International Bankers Association of Japan, International Council of Securities Associations, International Swaps and Derivatives Association, Inc., Investment Company Institute (ICI), Investment Industry Association of Canada, Securities Market Practice Group, The Clearing House Association, The Financial Services Roundtable.

The British Bankers’ Association, the Futures and Options Association, the Global Financial Markets Association (GFMA), the Institute of International Finance and the International Swaps and Derivatives Association, Inc.(ISDA) provide comments to the Secretariat of the Basel Committee on Banking Supervision Bank for International Settlements in response to the BCBS’ consultative document: Capitalisation of bank exposures to CCPs.

GFMA writes to express opposition to the imposition of a financial transaction tax (FTT), or other substitute form of the FTT.

The coalition of financial services firms and trade associations (Trade Associations) provides comments to IOSCO on their August 2011 IOSCO-CPSS Consultation Report on OTC derivatives data reporting and aggregation requirements.

The Trade Associations support the IOSCO-CPSS position that “a system of legal entity identifiers (LEIs”) would be an essential tool for the aggregation of OTC derivatives”.

The Global FX Division provides comments to the Bank for International Settlements (BIS) and the International Organisation of Securities Commissions (IOSCO) on the Consultative Report on OTC derivatives data reporting and aggregation requirements, Aug 2011.  The Global FX Division notes the selection of a preferred partner for trade repository services arises from the general preference of the industry for the use of global trade repositories, rather than multiple, fragmented local repositories. This is because they provide the chief benefits of enhanced regulatory oversight and efficiency of data capture. This is particularly the case for the FX market which is characterised by vastly higher number of transactions and participants when compared to other asset classes given its position as the basis of the global payments system.

GFMA provides comments to the U.S. Commodity Futures Trading Commission (CFTC) on swap data recordkeeping and reporting requirements for pre-enactment and transition swaps (also known as historic swaps), as issued by the Commission to implement provisions of Title VII of the Dodd-Frank Wall Street Reform and Consumer Protection Act.  Members of the Global Foreign Exchange Division (GFXD) are committed to supporting the establishing of an single data repository (SDR) to accommodate the foreign exchange asset class.

GFMA and 7 other Associations provide comments to EU Commissioner, Michel Barnier, and Treasury Secretary, Geithner, in relation to extraterritoriality in international regulators’ work on derivatives business.

This is a joint letter on extra‐territorial effects in EU and US regulation of derivatives with International Swaps and Derivatives Association (ISDA), European Banking Federation (EBF), Alternative Investment Management Association (AIMA), Futures and Options Association (FOA), Investment Management Association (IMA), and Wholesale Market Brokers’ Association (WMBA) and London Energy Brokers’ Association (LEBA).

The Global Foriegn Exchange Division (GFXD) of GFMA provides comments to the Commodity Futures Trading Commission (CFTC) on swap data repositories, swap data recordkeeping and reporting requirements,  real-time public reporting of swap transaction data, RIN 3038-AD20 – 17-CFR Part 49, RIN 3038-AD19 – 17-CFR Part 45, RIN 3038-AD08 – 17 CFR Part 43.  This letter is supplemental to GFXD's previous submissions on the proposed swap data repository (SDR) rules and is intended to clarify and further explain certain comments.
 

The Association for Financial Markets in Europe (AFME) welcomes the Committee on European Securities Regulators' consultation paper on transaction reporting on OTC derivatives and extension of the scope of transaction reporting obligations, and the opportunity to respond. AFME’s Foreign Exchange (FX) Division comprises 21 global FX market participants, collectively representing more than 85% of the FX market.

The FX market is the world’s largest financial market. Effective and efficient exchange of currencies underpins the world’s entire financial system. As many of the current proposals may have a significant impact upon the operation of the global FX market it is vital that the potential consequences of regulatory action are fully understood and that new regulation improves efficiency and reduces risk, not vice versa.

We are aware of the joint response to this paper being submitted by AFME, ISDA and& ASSOSIM and are supportive of the views set out in their paper. We have sought here
to focus on responses to the points within the consultation paper that are of particular relevance to the FX market.