FIA Says IOSCO's Updated Principles Should Apply Only To Derivatives On Physical Commodities

In comments on a proposed update to IOSCO's 2011 "Principles for the Regulation and Supervision of the Commodity Derivatives Markets," FIA asserted that IOSCO should clarify that the principles only "apply to exchange traded derivatives on a physical commodity or a non-financial deliverable with a finite supply."

As previously covered, IOSCO's Principles are intended to apply to the regulatory supervision of price discovery and hedging in the commodity derivatives markets as to procedures for preventing "manipulation and abusive practices." IOSCO requested feedback in response to market developments, including (i) regulatory changes, (ii) an increased dependence on electronic trading and data, (iii) technological advancements, (iv) unforeseen disruptions, and (v) multi-market trading abuses.