|
Oversight of the Singapore Exchange
On 23 November 2000, SGX was officially listed on the SGX Main Board. To avoid any conflicts of interests from SGX's self-listing, MAS took over the role of the listing authority for the Exchange's own listing, i.e. MAS approves the listing, conducts surveillance of trading in SGX's shares and monitors the continuous disclosure of material information by SGX. Furthermore, the Exchanges (Demutualisation and Merger) Act empowers MAS to issue directives to SGX to resolve any conflicts
of interest arising from its self-listing. Potential conflicts of interests are also addressed in a Deed of Undertaking to the MAS. In keeping with the Deed, SGX has appointed a Conflicts Committee, with
MAS as the approving authority for the composition of the Committee.
MAS has defined more clearly its regulatory relationship with SGX. As the statutory regulator, MAS will administer the corpus of statutory laws regulating the capital markets and have oversight of SGX's regulatory functions. SGX will retain the frontline responsibility of regulating market participants and ensuring compliance with its own rules. This MAS-SGX regulatory relationship applies to all the major areas of regulation, and entails the following:
a) MAS will ensure that SGX's inspection and supervision of its members is done competently by conducting independent inspections of SGX and its members.
b) SGX will conduct direct surveillance of the market, whilst MAS will carry out independent surveillance on a selective basis, to assure itself that this is done effectively.
c) SGX will ensure that listed companies make timely and complete disclosure of material
information, whilst MAS may conduct civil prosecution of offending companies which contravene disclosure requirements under the proposed SFA.
MAS has enhanced its enforcement capabilities by setting up a dedicated enforcement unit. MAS will also work with SGX to strengthen market surveillance by installing an electronic surveillance system.
Cross-Border Linkages
Equity
The Singapore Exchange-Securities Trading Ltd. (SGX-ST)
entered into an agreement with the Australian Stock
Exchange (ASX) on 6 June 2000 to establish an electronic
linkage between the respective securities markets. The
link, which will facilitate trading of SGX-quoted securities
by Australian investors, and of ASX-quoted securities
by Singaporean investors. The link is expected to be
implemented by the fourth quarter of 2001. The link
will increase the depth and breadth of the local market,
and allow Singapore investors to trade seamlessly into
the ASX market.
SGX and the American Stock Exchange (Amex) announced
their plans on 1 June 2000 to establish a joint venture
to list and trade Amex-listed exchange-traded funds
(ETF) and structured products on SGX-ST. The proposed
joint venture is the first step in the development of
a global ETF trading system and will provide both retail
and institutional investors with the opportunity to
trade ETFs across the North American and Asian time
zones. In line with the two Exchanges' agreement, the
first ETFs were listed on SGX-ST for trading on 4 May
2001.
Derivatives
In September 2000, Spain's Futures and Options Exchange,
MEFF became the sixth international partner to join
the GLOBEX Alliance which will link the Singapore Exchange-Derivatives
Trading Ltd. (SGX-DT) and five other futures exchanges
across the globe. The Globex partners include the Chicago
Mercantile Exchange (CME), SBF ParisBourse, SGX-DT,
the Bolsa Mercadorias & Futuros of Brazil (BM&F),
MEFF and the Montreal Exchange. Under the Alliance,
members of each exchange will be able to directly access
the electronically traded products of all Alliance markets,
and cross-margin positions to reduce the capital requirements
of their customers and members.
SGX-DT entered into an agreement with India's National
Stock Exchange (NSE) and India Index Services and Products
Ltd (IISL) in May 2000 to trade the S&P CNX Nifty
Stock Index futures and options contracts. SGX listed
the Nifty index futures contract in September 2000,
with a similar contract being listed on the NSE in June
2000. SGX-DT and NSE have also agreed to co-operate
in areas related to derivatives trading, market-information-sharing,
staff training and technical assistance.
Memoranda of Understanding
MAS continued its efforts to ensure that its international
co-operative arrangements stayed apace with industry
developments in cross-border exchange linkages and provision
of investment services. Memoranda of Understanding were
signed with the securities regulators of Australia,
Germany, the US, Brazil, Quebec and South Africa to
provide mutual assistance and exchange information necessary
for investigations into offences or fraudulent practices
regarding securities and futures transactions, as well
as to facilitate the effective performance of supervisory
functions and enforcement of securities laws and regulations.
|