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G20 Provides Clues on Upcoming Global Financial Regulation
Practical Law Legal Update 9-600-9556 (Approx. 3 pages)
G20 Provides Clues on Upcoming Global Financial Regulation
by Practical Law Finance
| Published on 19 Feb 2015 • USA (National/Federal) |
The G20 published a communiqué following its meeting on February 9-10, 2015, providing insight into areas of global regulatory focus for 2015 and beyond.
The Group of Twenty Finance Ministers and Central Bank Governors (G20) published a communiqué following its meeting on February 9-10, 2015, providing insight into areas of global regulatory focus for 2015 and beyond.
Issues examined in the communiqué include:
- Monetary and fiscal policies.
- The difficulty of small to medium enterprises in securing financing and the danger of income inequality.
- Falling oil prices.
The G20 states that it will continue its efforts to finalize the remaining core financial regulatory reform elements this year, including:
- Steps required to address the "too-big-to-fail" problem.
- Finalizing the methodology for identifying systemically important financial institutions beyond the banking and insurance sector by the end of 2015 and design policy measures.
In the document, the G20 stresses its commitment to implementing Key Attributes of Effective Resolution Regimes for all parts of the financial sector that could be systemic in the event of failure (see Legal Update, FSB key attributes of effective resolution regimes for financial institutions). The G20 also will enhance cross-border cooperation to enable regulations to be more effective, particularly in the areas of resolution and over-the-counter (OTC) derivatives markets reforms, where swift implementation is required. The G20 has also devoted some time to discussing funding issues for small to mid-size enterprises (SMEs).
The G20 outlined some issues for further action that will help address economic growth, including:
- Identifying commitments that have the greatest impact on growth and helping to model methodology of growth strategies.
- Analyzing country-specific investment strategies and assisting in providing an aggregate ambition in fostering investment.
- Developing long term investment financing strategies.
- Revising corporate governance principles.
- Developing asset-based financing (such as Sukuk) for infrastructure which will cover banking regulation and supervision, Sukuk market development and monetary policy frameworks.
- Planning and prioritizing infrastructure projects and strengthening methodologies to identify and design infrastructure projects.
- Promoting greater transparency in public private partnership (PPP) transactions, as well as increasing public awareness and understanding of PPP projects.
- Identifying and addressing any remaining gaps and potential financial stability risks relating to central clearing counterparties (CCPs) that are systemic across multiple jurisdictions.
- Analyzing current policy and administrative aspects of taxing SMEs.
- Exploring progress made in signing the Multilateral Convention on Mutual Administrative Assistance in Tax Matters and incentives and implementation processes to deal with those countries which fail to respect Global Forum standards on exchange of tax information on request.
- Reporting on efficient and effective use of tax incentives in low-income developing countries.
- Strengthening counter-terrorism financing tools and developing guidelines to enhance transparency of payment systems in order to mitigate the risk of abuse through terrorism financing and money laundering purposes.
- Collaboration of international financial institutions on climate finance.
This Update is based, in part, on material provided by the Accelus service Compliance Complete (http://accelus.thomsonreuters.com/products/accelus-compliance-complete), which provides regulatory news, analysis, rules and developments, with global coverage of more than 400 regulators and exchanges.