Regulators Publish Codes on Best Market Practice in FX

The new Code of Conduct supersedes a previous report in 2013.
By Janet Du Chenne(59204)
The London Foreign Exchange Joint Standing Committee, New York FX Committee, European Central Bank’s FX Contact Group and five other global FX committees have published new guidance on expected behavior by FX market participants.

The new Code of Conduct supersedes a previous report in 2013 and recognizes shared support for certain high-level principles, which underpin the existing codes. For example, FX market participants are expected to have systems and controls in place to support robust and efficient back office operations including confirmation, netting, payment and settlement.

It follows a set of recommendations released by the Financial Stability Board last summer after two years of headlines on benchmark manipulation and market malpractice.

In addition to incorporating all elements of the FX transaction, the guidance also reinforces the existing code on confidentiality of reporting transactions to external parties such as trade repositories or CCPs, as may be required by law.