Governing the self-regulation in capital markets and commodity markets: experience of the United States

Having studies the U.S. legislation on capital markets and commodity markets, the author discovered that it allows the delegation of certain regulatory powers to, mainly, stock exchanges, in particular, those related to licensing professional participants in these markets by conducting qualification exams, establishing and monitoring compliance with market rules with the application of liability measures to violators (exclusion, suspension of membership, restrictions on activities, functions and operations, fines, additional prior control (censorship), suspension or prohibition of associations, etc.). It was established that decisions imposing the liability measures can be appealed to the relevant state regulatory authority, which may support this decision, amend it or set it aside, including remanding the case to self-regulatory organization for reconsideration. In addition, the comparative analysis showed that in the United States, market rules are set forth and reviewed by a self-regulatory organization in line with a procedure that includes, among other things, the US Securities and Exchange Commission conducting public consultations on the relevant rules, taking into account the opinions and comments of the public when approving or disapproving market rules or changes to them. Furthermore, the article indicates that the competent regulatory authority, if it is necessary in the public interest, to protect investors or otherwise to achieve objectives of the legislation, may suspend for a period of up to 12 months or cancel the registration of a self-regulatory organization, or subject its activities to prior control (censure) or introduce restrictions on its activities, functions and operations, if the relevant regulatory authority, following a hearing with the participation of the self-regulatory organization, establishes that such organization has violated or cannot comply with any provision of the law or its own rules, or has failed without sufficient grounds or good reason to ensure compliance with these requirements by its members (participants).