UK FUNDS MARKET PRACTICE GROUP CONSTITUTION

Transcription

1 UK FUNDS MARKET PRACTICE GROUP CONSTITUTION Status: Version 1 (final) Publication date: January 2012 Author: David Broadway - 1 -

2 Change log Version 1 Final Initial publication 11 January

3 INTRODUCTION - THE SECURITIES MARKET PRACTICE GROUP [extracted from the SMPG Bylaws] 1. The Securities Market Practice Group (SMPG) is a not-for-profit global securities industry group comprising national market practice groups (NMPGs) and certain other affiliated organisations. Its mission is to create globally harmonised market practices with the objective of enhancing straight through processing at an industry level. This objective includes the harmonisation of non-regulated geographic differences as well as consistent implementation of ISO messaging standards by securities industry participants for processing within and across all markets. 2. NMPGs comprise financial institutions that are active in the securities industry. At the discretion of individual NMPGs, other interested organisations such as solution vendors and consultants may be admitted, but under the SMPG bylaws shall not have any voting right in the event of a ballot. 3. The objective of the NMPGs is to discuss and agree upon local harmonised market practices. These practices shall, as far as possible be aligned with existing globally agreed market practices, subject to country specific requirements, which shall be documented, published on the SMPG website and kept up to date by the group. 4. NMPGs are expected to comment on SMPG global market practice working documents and to send representation to the global SMPG meetings. Local meetings are held at the convenience of the NMPG groups. UK representation at the SMPG 5. At global level, the SMPG consists of four working groups: Corporate Actions (active) Investment Funds (active) Settlement & Reconciliation (active) Trade Initiation (dormant) 6. For the purposes of the Corporate Actions and Settlement & Reconciliation working groups, the UK and Ireland are represented by a "UK & IE" NMPG. In contrast, the two countries are represented separately at the Investment Funds Working Group. This constitution concerns only the UK NMPG for investment funds

4 UK FUNDS MARKET PRACTICE GROUP - ORGANISATION Name 7. The group shall be known as the UK Funds Market Practice Group (UKFMPG) Objective and scope 8. The UKFMPG is the investment funds NMPG for the UK and a constituent of the Investment Funds Working Group of the global SMPG. 9. The objective of the UKFMPG is to develop market practices for the implementation and use of financial messaging under the ISO standard insofar as they relate to the processing of investment fund transactions and events. 10. For these purposes, "investment funds" means funds that are domiciled in the UK. The principal focus will be UK-authorised unit trusts and open-ended investment companies, but market practices may encompass, or be prepared separately for, other types of fund structures, such as those used to support the corporate pensions industry. Membership 11. Participation in the UKFMPG is open to anyone with a genuine interest in the development of market practice pursuant to the above objective. 12. Participants will fall into two categories: Financial institutions - including fund managers and third party administrators, fund platforms, custodians, dealing intermediaries (discretionary managers, brokers, IFAs, etc.); Solution providers/others - including communication hub/network providers, administration platform vendors, middleware solutions vendors etc., as well as standards developers seeking to maximise the interoperability of those standards with ISO Chair and vice-chair [per the SMPG bylaws] 13. The UKFMPG shall have a chair and a vice-chair, whose roles are to chair UKFMPG plenary meetings, represent the views of the UKFMPG at global level (the SMPG) and ensure the circulation of information to UKFMPG participants at local level. 14. If neither is able to attend a global SMPG meeting, they may nominate someone else to do so from within the UKFMPG. 15. In the interests of neutrality, the chair and vice-chair should be from separate institutions, wherever possible. Election of the chair and vice-chair 16. The chair and vice-chair shall be elected from participants in the UKFMPG who may volunteer for that purpose at the annual plenary meeting (see paragraph 19)

5 17. In the event that more than two volunteers stand for election, including the present incumbents, the positions shall be determined by secret ballot among those present at the meeting. Separate ballots shall be held for each position. The allocation between chair and vice-chair shall be by agreement between the two elected parties or otherwise determined by the winner of the first ballot. Voting will be on a one vote per company basis. 18. The chair and vice-chair positions may be filled by participants from both financial institutions and solution providers/others. In addition, notwithstanding the SMPG Bylaws concerning voting at the global level (see paragraph 2), all participant organisations may take part in any ballot on the chair and vice-chair positions. Plenary meetings 19. The UKFMPG shall hold at least one plenary meeting each year, to which all UKFMPG participants shall be invited. The agenda will, as a minimum, include: reports of working group activities during the year; report on discussions at the global SMPG election of chair and vice-chair positions; determination of the UKFMPG's priorities going forward. Working groups 20. Working groups may be formed and meet as necessary to develop market practices for specific processes or business domains or for any other purpose that may assist in the work of the UKFMPG. 21. Working groups shall nominate a chair and, if desired, a co- or vice-chair from within the group. MARKET PRACTICE RECOMMENDATIONS Preparation 22. Market practices are prepared and agreed within the relevant working group and then are circulated to the full UKFMPG for approval (see also "Decision Making" below). Publication 23. Once finalised, market practice documents are published on the SMPG website. They may also be published elsewhere in the interests of widening their exposure to the industry. 24. Except where dictated by regulation, updated market practices should as far as possible be published with an implementation date no earlier than six months afterwards in order to allow systems to be recoded. DECISION MAKING [consistent with the SMPG Bylaws] 25. Decision making is based primarily on consensus. In the unlikely event that consensus cannot be reached, a vote will take place, with a 75% majority of the votes cast needed for a decision to be taken

6 26. Voting will be on a one vote per company basis, with the exception of the election of the chair and vice-chair) limited to participating financial institutions at working group or UKFMPG level, as appropriate