SRO should enter the financial market in 2016

Currently, there are several definitions of the concept of «self-regulatory organization». The following one is among the most precise definitions:

Self-regulatory organization (SRO) is a non-profit organization that joins business entities based on the unity of production branch of goods, works and services or the market of produced goods and services, or that joins the subjects of professional activity of a certain kind.

The basic document, which regulates relations, arising in connection with the acquisition and termination of the status of self-regulatory organizations, the activity of SROs, cooperation between SROs and their members, consumers of goods, works and services produced by them, is the federal law №315-FZ "On self-regulatory organizations» dated 01.12.2007, in force as of 24.11.2014.

The functions of SROs include:

1) development and establishment of conditions for the membership in SRO;

2) disciplinary action; 

3) resolution of disputes between members;

4) analysis of the activity of its members;

5) representation of interests of members of SRO;

6) professional training;

7) insurance of transparency;

8) supervision of compliance with standards and rules of SRO;

9) examination of complaints;

10) maintenance of the register of members.

By 2015, the analysis of organizations and the situation in the financial market has shown the necessity of the establishment of SRO in it. In July 2015 the Federal Law №223-FZ «On self-regulatory organizations in field of the financial market and on amendments to Articles 2 and 6 of the Federal Law «On introducing amendments to certain legislative acts of the Russian Federation» has been adopted. The effect of this law extends to SROs, joining financial institutions engaged in certain types of activity (brokers, dealers, depositaries, insurance companies, microfinance institutions, pawnshops etc).

Currently, analysts assess positively the creation of SRO in the financial market. The following arguments are declared among others:

• self-regulation is a convenient mechanism for cooperation between the Central Bank and market participants;
• SRO may apply the standards, regulatory rules by direct participation of its members;
• separation of the regulation between the Central Bank and SRO will help not limit creative developments of market participants etc.

Moreover, the developed standards and rules of SRO in the financial market may be more stringent, than by the mega-regulator. Participation in SRO can be also considered as a sign of quality for a customer.

Perhaps this is why the Central Bank considers the development of SRO in the financial market as a «mega-ambitious goal». The law will come into force since the 1st of January 2016. The Central Bank will regulate depending on the scope of financial institution and specific of its activity. However, SRO express readiness for oversight functions already today.