Implementation monitoring of PFMI: Assessment and review of application of Responsibilities for authorities

November 2015

The Committee on Payments and Market Infrastructures (CPMI) and the International Organization of Securities Commissions (IOSCO) continue to closely monitor the implementation of the Principles for financial market infrastructures (PFMI). The PFMI are international standards for payment, clearing and settlement systems, and trade repositories. They are designed to ensure that the infrastructure supporting global financial markets is robust and well placed to withstand financial shocks.

This report presents the findings of the CPMI-IOSCO assessment of the completeness and consistency of frameworks and outcomes arising from jurisdictions' implementation of the Responsibilities for authorities in the PFMI. The assessments covered implementation of the Responsibilities across all financial market infrastructure (FMI) types in 28 participating jurisdictions. The work on the Responsibilities was carried out as a peer review during 2015 and the assessment ratings for each jurisdiction reflect the implementation measures in place as at 9 January 2015; other measures implemented after this date, or other material developments, are noted where relevant but were not considered when assigning ratings of observance.

Overall, the assessment revealed that a majority of the jurisdictions had achieved a high level of observance of the Responsibilities. Of the 28 jurisdictions assessed, 16 fully observed the five Responsibilities for all FMI types; an additional two jurisdictions either fully or broadly observed each of the five Responsibilities for all FMI types.

With respect to specific FMI types, jurisdictions most frequently fell short of a fully observed rating in the case of trade repositories (TRs). Five of the participating jurisdictions had TR regimes that were still in development and were therefore determined to be "not ready for assessment". In addition, several other jurisdictions lacked clear criteria and/or fully disclosed policies to support their regulation, supervision and oversight of TRs.

With respect to specific Responsibilities, considerable variability was observed in implementation measures for the Responsibility on cooperation with other authorities. This was due partly to the fact that many cooperative arrangements are new, but may in some cases also reflect different interpretations among authorities of the expectations in this area.

CPMI and IOSCO will review the Responsibilities in light of the findings of this assessment and consider the need for additional guidance. Further, as jurisdictions gain greater experience with cooperative arrangements, particularly cross-border arrangements for central counterparties (CCPs) and TRs, CPMI and IOSCO expect to consider new developments as part of a follow-up exercise to this report.