XN000022-1991-01-02 — Page 2

WEDNESDAY, JANUARY 2, 1991

1

FRINGE FOREX DEALINGS SHOULD BE REGULATED

*

AN INTERNAL WORKING GROUP SET UP UNDER THE BRANCH HAS REACHED AN INITIAL DECISION THAT DISCRETIONARY DEALINGS LEVERAGED FOREX CONTRACTS SHOULD BE RESTRICTED

INSTITUTIONS SUPERVISED BY THE EXISTING AUTHORITIES.

MONETARY AFFAIRS

IN

TO SPECIFIED

BE

"THE WORKING GROUP, COMMISSIONED BY THE SECRETARY FOR AFFAIRS TO CONSIDER WAYS TO TACKLE THE PROBLEMS ACTIVITIES OF FRINGE FOREX COMPANIES, HAS OPTION SHOULD

PURSUED, A GOVERNMENT (WEDNESDAY).

MONETARY ARISING FROM THE DECIDED THAT THIS POLICY SPOKESMAN SAID TODAY

OPTIONS WHICH THE INTO THE WRITTEN CONSULTATION

THIS IS ONE OF THE THREE POSSIBLE POLICY WORKING GROUP HAS CONSIDERED AFTER THE EXAMINATION SUBMISSIONS MADE ON THE SUBJECT DURING THE PUBLIC EXERCISE CONDUCTED IN JUNE AND JULY LAST YEAR.

MINIMUM LEVEL OF AND MANPOWER

FRAMEWORK,

"THIS OPTION HAS THE VIRTUE OF ENABLING A REGULATION TO BE IMPOSED AND AVOIDING THE FINANCIAL BURDEN OF INTRODUCING A NEW AND COMPREHENSIVE REGULATORY HE POINTED OUT.

AND COMMODITIES EXCHANGE EXCHANGES FROM

THE WORKING GROUP IS AWARE THAT SECURITIES DEALERS WHO ARE MEMBERS OF THE STOCK EXCHANGE OR THE FUTURES ARE PREVENTED BY THE RESPECTIVE REGULATIONS OF THE CARRYING ON BUSINESS IN FOREX.

INSTITUTIONS DEALINGS

"IT IS ALSO AWARE THAT ONLY A FEW AUTHORISED UNDER THE BANKING ORDINANCE AT PRESENT OFFER DISCRETIONARY IN LEVERAGED FOREX CONTRACTS,"

HE SAID.

PROPOSE A NEW ALL THOSE

LEVERAGED

FOREX

THE WORKING GROUP HAS THEREFORE DECIDED ΤΟ CATEGORY OF DISCRETIONARY LEVERAGED FOREX CONTRACT DEALER. WHO WISH то CARRY ON DISCRETIONARY DEALINGS IN CONTRACTS WOULD HAVE TO REGISTER IN THIS CATEGORY.

THE SPOKESMAN SAID THE WORKING GROUP IS NOW

REGISTRATION AND SUPERVISORY REQUIREMENTS

CONSIDERING

WHAT

WOULD BR

PRUDENTIAL APPROPRIATE.

"THIS WILL PREPARE THE WAY FOR THE NECESSARY AMENDMENTS TO BE DRAFTED,

Ft

HE ADDED.

LEGISLATIVE

THE

THE WORKING GROUP HAS DECIDED THAT THE OPTIONS OF ALLOWING INDUSTRY TO REGULATE ITSELF AND THAT FOR THE INTRODUCTION OF AND COMPREHENSIVE REGULATORY FRAMEWORK SHOULD NOT BE PURSUED FURTHER.

A NEW

THE

"IN VIEW OF THE NATURE AND THE RECORD OF COMPLAINTS, WORKING GROUP CONSIDERS THE OPTION TO ALLOW THE INDUSTRY ITSELF IS UNACCEPTABLE.

то REGULATE THE SPOKESMAN SAID.

/"THE WORKING