Press releases

Deloitte comments on the Fair and Effective Markets Review (FEMR) final report

10 June 2015

David Strachan, partner, Deloitte EMEA Centre for Regulatory Strategy:

"The Fair and Effective Markets Review leaves no stone left unturned on the path towards restoring confidence in fixed income, currency and commodity (FICC) markets."

"The Bank of England, working in conjunction with HM Treasury and the Financial Conduct Authority, has delivered 21 recommendations, covering everything from individual and market standards of conduct through to remuneration and incentive structures in an effort to restore trust in FICC markets."

Global consistency
"The recommendations were always going to be ambitious, so it is no surprise that they are, particularly in the areas of personal accountability and the need for global consistency. The FEMR has generated interest from regulators globally and the final report recognises that global FICC markets need global standards. Mark Carney, given his role as Chair of the Financial Stability Board, is ideally placed to promote the UK’s thinking in other major markets but there are also significant roles for IOSCO and the Bank for International Settlements. Gaining universal acceptance looks easier for some recommendations (for example, a single global code for foreign exchange markets) than for others (for example, improving the alignment between conduct risk and remuneration)."

Personal accountability
"There is huge emphasis on personal accountability especially in the proposal to extend elements of the Senior Managers and Certification Regimes to all firms active in FICC markets. This will clearly increase personal accountability for top executives (both in the UK and potentially overseas) in active FICC firms, but the extension of the Certification Regime will come with significantly higher compliance costs especially for small firms. Deciding which firms to bring within this wider scope will be challenging."

FICC Market Standards Board
"The creation of the new FICC Market Standards Board (FMSB), modelled on the Takeover Panel, and bringing together all the relevant FICC market participants is very welcome. However, some of the grey areas it is called on to resolve will be challenging and it will have to react very quickly when questions arise about any new trading practice or emerging market risks. In particular, individuals subject to the Senior Managers and Certification Regimes will be looking to the FMSB to remove any ambiguities from the standards to which they will be held to account."


Notes to editors

About Deloitte
In this press release references to Deloitte are references to Deloitte LLP, which is among the country's leading professional services firms.

Deloitte LLP is the United Kingdom member firm of Deloitte Touche Tohmatsu Limited (“DTTL”), a UK private company limited by guarantee, whose member firms are legally separate and independent entities. Please see for a detailed description of the legal structure of DTTL and its member firms.

The information contained in this press release is correct at the time of going to press.

Member of Deloitte Touche Tohmatsu Limited.

Fern Hammond
Deloitte LLP
+44 (0) 20 7303 2329
+44 (0) 78 2689 1752

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