Preliminary Observations
In general, there is no single "preferred" model for the regulation of derivative products, markets, clearing houses or those who participate in such markets directly or as intermediaries. However, a review of the regulatory summaries indicates a substantial similarity in perceived regulatory objectives. From these summaries, it appears that these regulatory objectives may be achieved in various jurisdictions by different means and that regulation need not be identical to adequately address common regulatory goals. At a minimum, the consensus was that the aims of regulation should be: (i) financial safety including the integrity of clearing houses and market participants;There may be a number of explanations for the differences in regulatory structure and practice among jurisdictions. These reasons include: - The different nature and structure of markets; for example, pit trading as compared to screen-based or other electronic trading mechanisms,Among regulators, perceptions vary as to the significance of specific regulatory differences and how these differences could be resolved or accommodated where cross-border transactions occur and other jurisdictions have an interest in a particular transaction, market or person. Regardless of whether differences in the regulatory approach exist, there is consensus that bilateral or multilateral arrangements for information sharing between relevant regulatory authorities (whether governmental, quasi-governmental or private) are essential to addressing cross-border transactions effectively. Within the framework of these arrangements, and otherwise, several ways of resolving regulatory differences may be identified. Among others, these may include: - harmonization efforts;
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Introduction
