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The official Financial Regulation Journal of SAIFM

IOSCO reaffirms its 2013 ETF Principles and consults on good practices

By Sergey Dolomanov

IOSCO has published the much-anticipated follow-up to its 2013 ETF Principles in the form of a consultation on supplementary good practices. The consultation report, published on 6 April 2022, represents the output of a five-year long collaboration between regulators of major global ETF domiciles focussed on two broad themes, namely the effective functioning of the primary market and appropriate disclosure to investors, and is set against the backdrop of significant ETF growth, in-depth market studies and stress events.

Notably, IOSCO considers the 2013 ETF Principles to have stood the test of time and so neither proposes replacing them nor introducing additional standards or recommendations. Instead, it seeks feedback on a set of good practices to supplement the 2013 ETF Principles.

We have set out below the measures proposed by IOSCO as good practices for consideration by regulators, ETF managers/sponsors (responsible entities) and/or trading venues along with commentary on each.

Next Steps

Feedback to the Consultation Report is sought by 6 July 2022. Following the conclusion of the public consultation period, IOSCO will publish its final good practices report. The consultation and the final report are likely to be influential in further development of the European rulebook on ETFs, for example through a revision to the ESMA Guidelines on ETFs and other UCITS issues which have remained in their current form since 2014.

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