General Regulation

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Financial markets & infrastructures Presentation

Market & post-trade infrastructures

Published on May 30, 2013

The AMF is responsible for supervising market and post-trade infrastructures, which include trading venues such as regulated markets, multilateral trading facilities and systematic internalisers, clearing houses and central securities depositories.

Regulated markets & other trading venues

A regulated market is a system managed by a market operator that brings together multiple third-party buying and selling interests in financial instruments or assets admitted to trading.

The key role of the regulated market is to enable companies to raise funds by having access to a large number of investors. This is the “primary market” function. Regulated markets also allow investors to buy and sell the financial instruments issued by these companies (issuers). This is the “secondary market”, on which multilateral trading facilities and systematic internalisers also operate.

Regulated market status is granted by the Minister for the Economy based on a proposal by the AMF, which examines, among other things, the quality of the market operator’s senior management and shareholders, human, financial and material resources, the transparency and non-discretionary nature of market rules and the terms for admitting members and financial instruments.

The market operator is required to introduce checks to ensure that the regulated market operates in an orderly fashion. In particular, it must make sure that its members comply with the market rules and identify any behaviour that could potentially signal price manipulation, dissemination of false information or insider dealing. The market operator must also make sure that issuers provide members with access to the information that they make public. Any breaches must be reported to the AMF.

Shares and bonds may not be admitted to trading without the agreement of the issuer, unless the securities are already admitted to a regulated market of a Member State of the European Community or a State party to the European Economic Area Agreement.

During trading hours, to meet pre-trade transparency obligations, the market operator must continuously publish bid and offer prices and the corresponding number of financial instruments. To meet post-trade transparency obligations, it then publishes the price, volume and time of executed share transactions.

The AMF issues professional licences
The AMF issues professional licences to those responsible for overseeing trading, members and compliance at the market operator.

The AMF approves the market rules along with any amendments, ensuring that they comply with the regulations in force. The AMF’s approval decisions are made public.

The market operator reports daily to the AMF on orders received from market members and executed trades. On this basis, AMF staff prepares inspections to identify potential market abuse.

Clearing house

By virtue of its credit institution status, the clearing house is authorised by the Autorité de Contrôle Prudentiel (ACP) after the AMF and the Banque de France have given their opinions. The clearing house is a post-trade participant that is involved after trading but before settlement. It makes financial markets more secure by giving clearing members a guarantee of post-trade securities delivery and cash settlement, particularly if insolvency proceedings are instigated against a clearing member. It thus contributes to market stability and reduces systemic risk. The AMF approves its operating rules.

Central securities depository

Supervised by the AMF, the central securities depository records the securities issued by corporate entities whose securities are admitted to trading on a market as well as the shares and units of UCITS that are deposited with it. As the settlement system operator, the central depository ensures the orderly post-trade circulation of securities and cash between financial intermediaries.

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Legal information
Head of publications: Florence Gaubert, Executive Director of AMF Communication Directorate.
Contact: Communication Directorate – Autorité des marches financiers 17 place de la Bourse – 75082 Paris cedex 02