30 May 2018
On 12 April 2018, the Singapore Foreign Exchange Market Committee (“SFEMC”) published a revised version of “The Singapore Guide to Conduct and Market Practices for the Wholesale Financial Markets” (“Guide”), commonly referred to as “The Blue Book”. The latest version of the Guide is posted on the Monetary Authority of Singapore’s (“MAS”) website.
The Guide applies in parallel with the FX Global Code (“Global Code”). The Global Code is a code of conduct for the global wholesale foreign exchange market, and the SFEMC has endorsed the Global Code. While the Global Code applies only to foreign exchange, the Guide applies to foreign exchange, other asset classes
(for example, debt securities and money market instruments) and practices for benchmark rate setting.
Key changes to the Guide
Substantial revisions have been made to the Guide compared to the previous version. Notably, the scope of application of the Guide has been:
- Extended to all participants in Singapore that are engaged in the wholesale financial markets for all asset classes covered by the Guide (“Market Participants”). These include buy-side entities and financial market infrastructures, as well as all persons who are subject to the Global Code. Previously, the Blue Book applied only to sell-side entities and brokers.
- Extended to cover exchange-traded products. Previously, the Guide applied only to the over-the-counter markets. The Guide will continue to exclude cash equities and exchange traded funds.
The Ethics, Governance and Risk Management principles from the Global Code are good practices that should apply to the entire wholesale financial market, of which the wholesale FX market is a part. Therefore, these principles have been incorporated into the Guide and will apply to all asset classes. Similar principles in the previous version of the Guide have been deleted to avoid duplication.
To find out more about the changes that have been made to the Guide, please click here for “The Singapore Guide to Conduct and Market Practices for the Wholesale Financial Markets: Frequently Asked Questions” published by the SFEMC.
Effect of the Guide
The Guide does not impose legal or regulatory obligations on Market Participants. In addition, there is no requirement or expectation for Market Participants to sign or publish any statement confirming that their activities are aligned with the Guide.
However, the SFEMC is of the view that all members of SFEMC recognise that the Guide represents industry guidance on good practices and they consider themselves to be bound by the Guide.
Implementation of the revised Guide
The SFEMC expects Market Participants to align their current practices, policies and procedures to the principles in the revised Guide by 1 January 2019.
The following materials are available on the SFEMC website www.sfemc.org:
- The Singapore Guide to Conduct and Market Practices for the Wholesale Financial Markets
- The Singapore Guide to Conduct and Market Practices for the Wholesale Financial Markets: FAQs