The International Organization of Securities Commissions on April 7 published two consultation reports aimed at enhancing the ability of financial markets and intermediaries to manage risks, withstand catastrophic events and quickly resume services in the event of a disruption.
IOSCO said a key objective of the reports is to address possible weaknesses or gaps in the business continuity plans and recovery strategies of trading venues and market intermediaries. IOSCO said the consultations were informed by recent events, such as the cyber attacks on J.P. Morgan in August 2014 and the damaging impact of Superstorm Sandy in October 2012, which highlighted the need for regulatory attention to this issue.
One consultation is focused on trading venues and provides an overview of the steps that trading venues take to manage risks associated with electronic trading and the ways they plan for and manage disruptions through their business continuity plans. The report provides recommendations to help regulators ensure that trading venues are able to manage a range of evolving risks and proposes practices that should be considered by trading venues when developing and implementing risk mitigation mechanisms and business continuity plans.
The other consultation is focused on intermediaries and proposes standards and practices that regulators could consider as part of their oversight of business continuity and recovery planning. Comments on the consultations must be submitted by June 6.
