The International Organization of Securities Commissions (IOSCO) today published a final report on Regulation of retail structured products, which provides a toolkit outlining regulatory options that securities regulators globally may find useful to regulate retail structured products.

ASIC Chairman Greg Medcraft and staff co-led the development of the report, together with representatives from the French Autorité des Marchés Financiers.

‘Retail structured products are an example of complex products offered to mum and dad investors. They may be attractive when investors are searching for yield. However, they pose risks to investors through potential mis-selling, poor disclosure and bad product design.

‘This report is a great example of how IOSCO helps develop best-practice regulatory responses to emerging investor protection issues’, Mr Medcraft said.

The toolkit has been developed with the goal of enhancing investor protection by providing securities regulators with possible approaches to address certain concerns with retail structured products.

The proposed tools are intended to allow for a wide range of application and adaptation in different jurisdictions, and regulators may choose to implement some, all, or none of them in their jurisdiction.

The development of the toolkit reflects ASIC’s stated focus on innovation-driven complexity in products.

ASIC expects to release a domestic report on complex products early in the new year. IOSCO’s work will help inform the direction of that report.

View the IOSCO release

Background

The French Autorité des Marchés Financiers (AMF) regulates participants and products in France’s financial markets. It regulates, authorises, monitors, and, where necessary conducts investigations and issues sanctions. In addition, it ensures that investors receive material information, and provides a mediation service to assist them in disputes.