[Federal Register Volume 63, Number 42 (Wednesday, March 4, 1998)]
[Notices]
[Pages 10595-10596]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 98-5506]
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COMMODITY FUTURES TRADING COMMISSION
Notice of Establishment of the Commodity Futures Trading
Commission Global Markets Advisory Committee
SUMMARY: The Commodity Futures Trading Commission has determined to
establish the ``Commodity Futures Trading Commission Global Markets
Advisory Committee.'' As required by Section 9(a)(2) of the Federal
Advisory Committee Act, 5 U.S.C. App. 2, 9(a)(2) and 41 CFR 101-6.1007,
the Commission has consulted with the Committee Management Secretariat
of the General Services Administration. The Commission certifies that
the creation of this advisory committee is necessary and in the public
interest in connection with the performance of duties imposed on the
Commission by the Commodity Exchange Act, 7 U.S.C. 1 et seq., as
amended. This notice is published pursuant to Section 9(a)(2) of the
Advisory Committee Act, 5 U.S.C. App. 2, 9(a)(2) and 41 CFR 101-6.1015.
FOR FURTHER INFORMATION CONTACT:
De'Ana Dow, Legal Counsel to Commissioner Barbara P. Holum (Tel. (202)
418-5070), or Helen G. Blechman, Assistant General Counsel (202) 418-
5116, Commodity Futures Trading Commission, Three Lafayette Centre,
1155 21st Street, N.W., Washington, D.C. 20581.
SUPPLEMENTARY INFORMATION: The globalization of futures markets has
been a principal development of the 1980's and 1990's. Such global
expansion is characterized by:
The increasing number of futures markets being established
internationally,
The increasingly multinational nature of regulated U.S.
Firms,
The international linking of markets,
Concerns about international market risk, and
The increased demand for global brokerage services by U.S.
market users.
The recent volatility that has shaken world equity and currency
markets has demonstrated more vividly than ever before that the markets
are inextricably linked through common products and related market
participants. Therefore, events that occur in one market can and
frequently do cause global regulatory and business concerns. The shocks
to the world financial system caused by the collapse of Barings Plc. in
1995 and the significant losses incurred by the Sumitomo Corporation in
1996 also dramatically illustrate that this is true.
Increasingly sophisticated and low-cost communication technology
such as the Internet has expanded access to markets and to market
users. Currently, the Commission, as well as other U.S. and foreign
regulators, are considering appropriate regulation of the use of such
electronic cross-border vehicles for trading. Moreover U.S. firms face
an array of disparate regulatory policies as they conduct business in
numerous countries.
These trends raise complex and novel issues that could profoundly
affect the integrity and competitiveness of U.S. markets and U.S. firms
engaged in providing financial services globally. The Commission wishes
to establish a forum in which it can discuss such issues with U.S.
markets and firms to assist it in designing its regulations and
updating its procedures in response to these profound changes. These
issues would include:
(1) Avoiding unnecessary regulatory or operational impediments
faced by those doing global business, such as:
(a) Differing and/or duplicative regulatory frameworks,
(b) Lack of transparency of rules and regulations, and
(c) Barriers to market access,
while preserving core protections for markets and customers.
(2) Setting appropriate international standards for regulation of
futures and derivatives markets and intermediaries;
(3) Assessing the impact on U.S. markets and firms of the
Commission's
[[Page 10596]]
international efforts and the initiatives of foreign regulators and
market authorities;
(4) Achieving continued global competitiveness of U.S. markets and
firms; and
(5) Identifying methods to improve domestic and international
regulatory structures.
The Commission has taken an active role in working with foreign
regulators to address global market issues. Recent global initiatives
have been designed: (1) to enhance international supervisory
cooperation and emergency procedures; (2) to establish concrete
standards of best practices that set international benchmarks for
regulation of futures and derivatives markets; (3) to encourage
improved transparency in those markets; (4) to improve the quality and
timeliness of international information sharing; (5) and to encourage
jurisdictions around the world to remove legal or practical obstacles
to achieving these goals.
The Commission anticipates that the advisory committee will provide
an extremely valuable forum for information exchange and advice on
these matters. The reports, recommendations and general advice from
this committee will enable the Commission to assess more effectively
the need for possible statutory, regulatory or policy alternatives to
address the challenges posed by the globalization of our markets.
Commissioner Barbara P. Holum will serve as Chairman and Designated
Federal Official of this Advisory Committee. The members of the
Committee will include those U.S. markets, firms and market users most
directly involved in and affected by global operations and will be
balanced in terms of points of view represented. Specifically, the
Commission is considering for membership a broad cross-section of
persons representing U.S. exchanges, regulators and self-regulators,
financial intermediaries, end-users, traders and academics.
The Commission has found that the committee would not duplicate the
functions of the Commission, another existing advisory committee or
other means such as public hearings. It has further found that advice
on such specialized matters is best obtained through the advisory
committee framework rather than through other more costly, less
flexible and less efficient means of assembling persons from all
sectors of the financial industry. The Commission, therefore, has
concluded that the creation of a Global Markets Advisory Committee is
essential to the conduct of the Commission's business and is in the
public interest.
Issued in Washington, D.C., on February 25, 1998, by the
Commission.
Jean A. Webb,
Secretary of the Commission, Commodity Futures Trading Commission.
[FR Doc. 98-5506 Filed 3-3-98; 8:45 am]
BILLING CODE 6351-01-M
