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NAUFOR Approves Basic Standards for Licensed Securities Market Participants

19.02.2015 13:31 / Interfax

The National Stock Market Participants Association (NAUFOR) Board of Directors has given its approval to the final version of Basic Standards for Licensed Securities Market Participants, says the Association release.

Basic Standards for Licensed Securities Market Participants are a crucial part of principle-based financial companies regulation. The standards regulate company-client relations, make companies comply with norms and employ best practice in the interest of clients, and combat malpractice.

The Standards are comprised of seven chapters:

- processing client instructions on the best terms,

- informing clients of risks,

- client investment profile appraisal,

- securities management types,

- conflict of interests prevention,

- client reporting,

- financial market participation risks management.

The document is due to be approved by the Central Bank, after which NAUFOR will set up a register of compliant companies. The register will be published on the Association website.

Until the Self-Regulating Financial Market Organization (SRO) Act has been passed, companies will join the register on a voluntary basis, after NAUFOR checks the company’s internal documents for compliance with the Standards.

Listed companies will be eligible for lower capital limits (RUB 15m from RUB 35m for brokers, RUB 5m from RUB 35m for asset management companies).

NAUFOR has been drafting the Standards since 2013, and in 2014 a working draft was ready for further discussions with NAUFOR committees and the regulator.

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