Report of the Working Group on Wholesale
and Retail Financial Transactions
Contents |
1. |
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i. | Division between wholesale and retail, and professionals and non-professionals |
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ii. | Appropriate rules for sales of financial products and solicitation for customers |
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iii. | Establishment, administration and enforcement of rules |
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iv. | Education of users and consumers |
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(3) | Premises of discussion |
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i. | Aims of the "Financial Services Law" |
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ii. | Types of users targeted |
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iii. | Risks and costs associated with financial transactions |
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iv. | Relationship between rules for transactions and rules for institutions (financial service providers) |
2. |
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i. | Purpose of classification |
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ii. | Classification criteria |
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iii. | Method of classification |
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(2) | Concrete classification criteria |
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i. | Standards directed at types of trading entities |
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ii. | Standards directed at types of transactions |
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iii. | Standards directed at combination of types of trading entities and types of transactions |
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(3) | Selection between wholesale and retail, and conversion between professionals and ordinary users |
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i. | Basic position |
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ii. | Method of selection and conversion |
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iii. | Scope of entities selectable and convertible |
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iv. | Scope and effects of selection and conversion |
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v. | Selection and conversion procedures |
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(4) (5) |
Classification of instances where the user
cannot be held to have own responsibility |
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i. | Handling of public service corporations |
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ii. | Handling of foreign entities |
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iii. | Handling of non-face-to-face transactions |
3. |
Rules concerning sales and solicitation actions |
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(1) | Definition of and relation between information provision requirements and suitability rules | ||
(2) | Information provision requirements | ||
i. | Information provision requirements as rules governing transactions and their relation to ordinary private law |
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ii. | Requirements and effects of transaction rules |
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iii. | Types of information that must be provided |
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iv. | Information provision requirements as rules for institutions |
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v. | Scope of application of information provision requirements (reduction of and exemption from information provision requirements, etc.) |
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vi. | Civil liability and rules for institutions |
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vii. | Procedural rules concerning information provision requirements |
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viii. | Burden of proof, requirements for exemption from liability and estimation of damages |
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(3) | Suitability rules |
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i. | Suitability rules in the narrow sense |
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ii. | Suitability rules in the broad sense |
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(4) | Rules concerning solicitation, etc. |
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i. | Definition of solicitation and advertising acts, etc. |
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ii. | Prohibition of improper solicitation acts, etc. |
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iii. | Rules on improper solicitation for customers |
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iv. | Rules on advertising |
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v. | "Cooling-off" and "warming-up" |
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vi. | Handling of "back finance", etc. |
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vii. | Handling of electronic commerce (e.g. via the internet) in financial products |
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(5) | Scope of liability of sellers/solicitors |
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i. | Relation to advisory activities (provision of information at time of sale/solicitation and after-care) |
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ii. | Obligation of institutions to warn customers |
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iii. | Sharing of responsibilities among sellers/solicitors and other concerned parties |
4. |
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(1) | Creation and administration of rules |
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i. | Basic position on creation and administration of rules |
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ii. | Creation of rules concerning sale of financial products, solicitation for customers and compliance by businesses |
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(2) | Monitoring and enforcement of rules |
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i. | Basic position on monitoring and enforcement of rules |
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ii. | Application of rules on compliance by institutions |
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iii. | Requirements of self-regulating bodies |
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(3) | System for simply and swiftly settling disputes out of court, etc. |
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i. | System for settling disputes out of court |
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ii. | Relationship with judicial procedures, etc. |
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iii. | Creation of single point of contact for dealing with complaints |
5. |
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(1) | The need for education of users and consumers |
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i. | Effective measures in the light of new trends in finance |
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ii. | Diverse and wide-ranging measures and improvement of access to information |
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iii. | Use of electronic media, etc. |
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(2) | Response in specific fields |
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i. | Industry |
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ii. | Consumers |
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iii. | Administration |
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iv. | Elementary and secondary education |
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v. | Continuing education |
Contents |
1. |
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(1) | Significance of collective investment schemes in the context of new trends in finance |
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(2) | Current state of rules and legislation on collective investment schemes in Japan |
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(3) | Basic understanding of issues of the Working Group |
2. |
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(1) | Definition and standard of collective investment schemes |
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(2) | Scope of application of rules and legislation on collective investment schemes |
3. |
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(1) | The need for rules concerning collective investment schemes |
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i. | Solving problems caused by the passive and collaborative nature of investment |
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ii. | Location of risk and embodiment and clarification of allocation of risk |
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(2) | Use of information disclosure |
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(3) | Use of governance functions |
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i. | Codes of conduct for vehicle operators |
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ii. | Exercising of investors·rights |
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iii. | External checks by third parties |
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(4) | Embodying and clarifying fiduciary duty |
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i. | The need to embody and clarify fiduciary duty |
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ii. | Content of rules on fiduciary duty |
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iii. | Methods and procedures for embodying and clarifying relations of responsibility |
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iv. | Enforcement of fiduciary duty |
4. |
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(1) | Framework of rules for collective investment schemes |
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i. | Rules on arrangement of schemes |
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ii. | Rules on operation of schemes |
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iii. | Rules on transactions in financial products formed through schemes |
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(2) | Rules on asset management schemes |
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i. | Rules on the use of governance functions |
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ii. | Rules on arrangement of schemes |
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iii. | Rules on asset management and advice |
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iv. | Rules on custody of assets |
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(3) | Rules on asset securitization schemes |
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i. | Rules on the use of governance functions |
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ii. | Rules on arrangement of schemes |
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iii. | Rules on custody of assets |
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(4) | Fit and proper structure of schemes |
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(5) | Other issues |
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i. | Rules on "fit and proper" for financial service providers |
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ii. | Rules on other types of arrangement of schemes |
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iii. | Differences in rules depending on attributes of investors |
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iv. | Cross-border transactions |
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5. |
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(1) | Rules on sales and solicitation | ||
(2) | Market rules | ||
i. | Rules on disclosure | ||
ii. | Other market rules | ||
6. |
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7. |
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(1) | Development of tax and accounting systems | ||
(2) | Development of system of enforcement | ||
(3) | Other improvements |