AMV: Securities Self-Regulatory Organization of Colombia. 14 de noviembre de 2014

Transcription

1 AMV: Securities Self-Regulatory Organization of Colombia 14 de noviembre de

2 AGENDA 1. AMV general description 2. Regulation 3. Compliance / Supervision 4. Enforcement / Disciplinary actions 5. Certification 6. FX-Self Regulation 7. Education 14 de noviembre de

3 GENERAL INFORMATION Securities self regulation in Colombia appeared in 1929, when the Bogotá Exchange established a Disciplinary Chamber to oversee market rules compliance. Its structure, scope and legal support has evolved since then Merger of 3 local SXs Incorporation of BVC Self regulation remain inside the exchange but acquired an independent governance as well as budget and functional autonomy. Law 964 recognized self regulation as an independent activity, regulated by the SFC and mandatory for all securities intermediaries (broker/dealers, banks, pension funds, mutual funds administrators, firms with direct access to registered trading platforms) In 2010 began voluntary self regulation for interbank FX trading. 14 de noviembre de

4 GENERAL INFORMATION Since July 2006, AMV is the only independent SRO in the Colombian securities market: Ownership and structure: The securities market self-regulator - AMV is a national private non-profit corporation, governed by the Constitution, civil rules, Law 964 of 2005 and articles therein, by it statutes and regulations and the principles that apply to SROs. It is authorized overseen by the by the SFC to act as SRO in relation with: suitable corporate governance structure, adequate conflicts of interest management, member compliance of AMV rules and statutes. MoU between the Commission (SFC) and AMV: Designates AMV as the front line regulator for market conducts. Establishes a joint work scheme (no duplication principle) that assures opportunity. Both entities discuss inspections, evidence, queries, complaints, etc. 14 de noviembre de

5 ROLE AND STRUCTURE RULEMAKING ISSUANCE OF CONDUCT RULES For the capital market Member Committees Board of Directors SFC Approval OVERSIGHT COMPLIANCE Surveillance of SRO rules + securities market regulation Real time surveillance Post trade + surveillance + Inspections and Examine. Complaints DISCIPLINARY ACTIONS SANCTION For those who do not comply with the rules Investigation stage (AMV) Prosecution (Disciplinary Tribunal) Warning Fine (disgorgement) Suspension Expulsion CERTIFICATION CERTIFICATE Market Professionals Personal background + Professional Examination (4 types) 14 de noviembre de

6 ROLE AND STRUCTURE: CORPORATE GOVERNANCE CHECKS AND BALANCE SYSTEM Large participation of the industry and independent members GENERAL MEETING OF MEMBERS DISCIPLINARY TRIBUNAL 12 members (4 from the industry, 8 independent) BOARD OF DIRECTORS 10 members (5 from the industry, 5 independent) ADMINISTRATION MEMBER COMMITTEES 12 Hearing panels 1 Decision council 14 de noviembre de Fixed Income market Equity market Compliance Academic FX Education

7 ROLE AND STRUCTURE: SCOPE Marketplaces 108 members 1 Markets Fixed income Equities Futures FX: Voluntary Systems Exchange (MEC, X-stream) Central bank (SEN) ICAP Tradition GFI Deceval Others* Pension ADMINISTRADORA Funds FONDOS PENSIONES Y CESANTIAS ASEGURADORAS Insurance OTROS Colombian self-regulation does not include: Issuers Investors Banks BANCOS SOCIEDADES COMISIONISTAS DE BOLSA Brokers *Others: public entities, special official institutions, cooperatives,, capital companies, investment funds managers and securitization companies Trust Companies FIDUCIARIAS Information up to November of

8 AGENDA 1. AMV general description 2. Regulation 3. Compliance / Supervision 4. Enforcement / Disciplinary actions 5. Certification 6. FX-Self Regulation 7. Education 14 de noviembre de

9 REGULATION: SCOPE The regulatory process seeks to strengthen market integrity and transparency. It is made up of four main steps: Definition of issues to be included in the regulatory agenda Study of each one of the issues of the regulatory agenda Drafting a normative proposal Procedure to include a new proposal within AMV's Set of Rules In order to modify AMVs Rule Book, AMV must meet the following: Publication of the proposal for comments of the industry Review of the proposal by the Board of Directors Regulatory Committee Approval of the Board of Directors in full. Submission to the Financial Superintendence for their approval. Participation of the industry is essential for the regulatory process. Members opinion is taken in consideration for the definition of the regulatory agenda as well as for the proposal or regulatory initiatives. 14 de noviembre de

10 AMV DOCUMENTS Rules Normativity aproved by the Board and SFC Policy Investigation Guidelines or policies that reflect AMV policy for its members Academic documents that study market concepts Public Consultation Documents that take into account Industry opinions Reports Documents with relevant information for the industry Booklest and Handbooks Practical tools about market concepts 14 de noviembre de

11 AGENDA 1. AMV general description 2. Regulation 3. Compliance / Supervision 4. Enforcement / Disciplinary actions 5. Certification 6. FX-Self Regulation 7. Education 14 de noviembre de

12 AMV AS FRONT LINE REGULATOR Through the MoU, responsibilities have been divided between the statutory regulator and AMV. Through agreements with Platforms we coordinate monitoring functions. Commission (SFC) Regulator for prudential matters, listings, issuer disclosure and governance. Relies on AMV as front line regulator, but inspects its activity and approves its rulebook (not a delegation of its responsibilities). SRO (AMV) Trading Systems administrators (exchange, central bank, clearing house and others) MoU (SFC-AMV): AMV as front line regulator Responsible for market conduct regulation (fixed income, equities, futures, FX) and member regulation (infringements with clients and compliance of institutional duties). Legal duty: Adopt procedures to monitor trades, compliance of their rules and verify clearing and settlement. Report suspicious matters to SFC or AMV and provide information when they conduct investigations. 14 de noviembre de

13 AMV AS A FRONT LINE REGULATOR Trading Systems (exchange, central bank, clearing house and others) Reference Data (news, corporate info., interest rates and others) Complaints and tips (whistleblower) Real time surveillance (access trading platforms) Requirement of additional information to members Advice or warning letter Referral to investigation unit Referral to enforcement unit Referral to rule writing unit Post trade surveillance (analysis and data mining) Request information further Analyze phone, mail and chats records Identify possible relationships Statements from witness Preventive supervision (inspections using risk based methodology) 14 de noviembre de

14 MARKET SURVEILLANCE Concept Verification of compliance with the applicable regulations by the subject of selfregulation, by conducting activities deemed appropriate to fulfill the purpose. Article 10. Rules of AMV Activities Following the market behavior and trading activities of the subjects of self-regulation. Monitoring and surveillance of transactions in different trading systems. Design and implementation of general, selective and special visits. Information requirements for self-regulated and third parties regarding intermediation operations. Evaluate investor complaints. Design and implement warning systems to identify irregular transactions. Execute performance plans to raise conduct and operation standards. Have a preventive role to avoid abuses inside the market. 14 de noviembre de

15 AGENDA 1. AMV general description 2. Regulation 3. Compliance / Supervision 4. Enforcement / Disciplinary actions 5. Certification 6. FX-Self Regulation 7. Education 14 de noviembre de

16 ENFORCEMENT: SCOPE AMV undertake the function of enforcement, consisting on investigating the facts and behavior of financial intermediaries to determine their disciplinary responsibility when there is a breach of the intermediary rules. Enforcement area investigates the facts and behavior of financial intermediaries to determine their disciplinary responsibility. Activities and procedures are developed upon the initiation of disciplinary proceedings. Disciplinary proceedings may be referred to securities intermediaries and those associates that are voluntarily self-regulated. The Disciplinary process has two stages, the investigation stage and the decision stage. 14 de noviembre de

17 DISCIPLINARY ACTIONS: PROCESS Investigation (President of AMV) It is a written investigation according to AMV s enforcement manual. During the investigation, the parties are able to negotiate a settlement agreement. Not all the settlement agreement that are negotiate by the President must be approved by the Enforcement Counsel. Prosecution (Disciplinary Tribunal) The Disciplinary Tribunal are independent from the Investigation Department. The case is presented to the Disciplinary Tribunal by written. Hearings are exceptional upon request of either party. The decision of the Disciplinary Tribunal may be appealed by any of the parties to the Second Chamber. Hearing officials are not solely dedicated to this function (part time). 14 de noviembre de

18 PENALTIES The imposition of penalties in disciplinary proceedings, will take place when there is a violation of the securities regulation. Natural Person 1. Warning 2. Penalty 3. Suspension Legal Entity 1. Warning 2. Penalty 3. Expulsion 4. Expulsion 14 de noviembre de

19 SANCTIONS IMPOSED BY AMV Type of sanction * Total Warning Fine Warning and Fine Suspension Suspension and Fine Expulsion Expulsion and Fine Administrative Total of Sanctions *Data as of November of de noviembre de

20 AGENDA 1. AMV general description 2. Regulation 3. Compliance / Supervision 4. Enforcement / Disciplinary actions 5. Certification 6. FX-Self Regulation 7. Education 14 de noviembre de

21 CERTIFICATION PROFESSIONAL CERTIFICATION OF SECURITIES MARKET NATIONAL REGISTRY OF SECURITIES MARKET PROFESSIONALS (NRSMP) Procedure by which individuals that have to be registered in the National Registry of Securities Market Professionals, can prove their technical and professional capacity to a certifying organization. Tool used for increase and control the standards of professionals who have the obligation to be registered. As well as has the objective to facilitate and expedite the market information about these professionals AMV offers the following certifications: 3 modalities with validity of 3 years: operators, commercial advisors and digitador (in charge of registering orders and operations) 1 modality with validity of 4 years: Directors 14 de noviembre de

22 PERSONS THAT HAVE TO BE REGISTERED IN THE NRSMP People that structure directly brokerage transactions, whatever their relationship. People who lead or brokerage transactions executed directly in the stock market. People who manage collective funds directly managed by fiduciaries. People who manage mutual funds directly supervised by the SFC. People who promote the realization of brokerage transactions in the stock market. 14 de noviembre de

23 CERTIFICATIONS Number of Certified Professionals* Number of Exams Number of Certified Professionals Number of Certifications *Data as of October 31 of de noviembre de

24 AGENDA 1. AMV general description 2. Regulation 3. Compliance / Supervision 4. Enforcement / Disciplinary actions 5. Certification 6. FX-Self Regulation 7. Education 14 de noviembre de

25 FX VOLUNTARLY SELF-REGULATION SCHEME BASES Industry initiative: it reflects their commitment to integrity, transparency and enforce higher standards in the exchange market. Objectives: Guarantee the correct price formation, avoiding fraud. Strengthening standards to manage conflicts of interest. The achievements in the securities self-regulation scheme, allows AMV to offer a voluntary scheme with the same level of demand and independency. AMV has set a framework of coordination and cooperation with FX market authorities (Central Bank and the Financial Superintendence). 14 de noviembre de

26 FX SELF-REGULATION MEMBERS As of November 05 of 2014, the FX self-regulation scheme had 36 members and 510 professionals certifieds. They account for more than the 95% of market operations. 14 de noviembre de

27 AGENDA 1. AMV general description 2. Regulation 3. Compliance / Supervision 4. Enforcement / Disciplinary actions 5. Certification 6. FX-Self Regulation 7. Education 14 de noviembre de

28 EDUCATION: Scope AMV offers a range of free educational resources to help investors build their financial knowledge to better understand the markets and basic principles of saving and investing. The program Financial Education for Everyone is coordinated by AMV and integrates by more than 70 financial entities. Its mission promote that the consumers has knowledge and abilities to take informed and responsible decisions. 14 de noviembre de

29 Free Investor Publications Electronic versions of AMV s education publications are available on the web page. They are all available free of charge. They cover the following topics: 1. Investor ABC s 2. Smart stock investing 3. Smart bond investign 4. Advantages of legal securities intermediaries 5. All your rights as an investor 6. Investor Glossary and FAQ 7. Risks in the securities market 8. Securities market system information 14 de noviembre de

30 La opinión expuesta en esta presentación no compromete a la entidad. Para uso restringido del Autorregulador del Mercado de Valores. Todos los derechos reservados. Ninguna parte de esta presentación puede ser reproducida o utilizada en ninguna forma o por ningún medio sin permiso explicito del Autorregulador del Mercado de Valores. 14 de noviembre de