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With the reform of the regulatory framework for European financial services, especially the implementation of the Markets in Financial Instruments Directive, investment services providers (ISPs) are now more accountable for protecting their clients' interests and maintaining market integrity. Under the new harmonised European rules, it is even more important for intermediaries to acquire the resources and organisational capabilities needed to fulfil their professional obligations. In particular, ISPs must employ staff who have the proper qualifications, knowledge and skills to carry out their duties.
Following a comparative analysis of existing practices at European and international levels, Jean-Pierre Pinatton, a member of the AMF Board, has been assigned to investigate the desirability and feasibility of developing a registration system to establish the knowledge of rules and regulations of the financial professionals working in the French markets. With respect to the Paris financial centre, this system would be an added advantage for pan-European and global participants, faced with a growing need to validate their employees' ability to operate in different national markets.
The findings of the working group and its proposed amendments to the AMF General Regulation are being put out to public consultation until 10 October 2008. Responses should be sent to contact@amffrance.org
Key measures
The working group is chaired by Mr Pinatton and composed of members of the main professional groups representing the activities that would be subject to registration (AFG, AFTI, AMAFI, ASF, FBF, SFAF), as well as Euroclear France, NYSE Euronext and LCH.Clearnet. The main proposals are to:- introduce a system that allows ISPs to verify in uniform fashion that employees in certain key posts have the relevant minimum knowledge of prevailing regulations. This can be done either internally by ISPs, using any means they wish but following a formal procedure, or by verifying that employees have passed an accredited external examination that meets international standards and that will give them a professional "passport", with a view to mutual recognition of qualifications in other jurisdictions;
- list the key posts that require a minimum body of knowledge: trader, salesman, investment analysts, asset managers, heads of clearing and settlement functions, compliance officers;
- establish in a core curriculum the body of knowledge to be acquired and certified, with respect to rules applicable to the professionals concerned;
- create a flexible cost-effective body, the High-Level Registration Council, that will be responsible for determining and checking the content of the registration system and the practical conditions put in place by the professional groups concerned.
