Australian Corporations and Markets Advisory Committee Releases Report on Derivatives

The report prepared by the Corporations and Markets Advisory Committee (“CAMAC”) responds to a request from the Australian Government for advice on the suitability of the legislative definition of “derivative” for today’s derivatives markets and whether it may be possible to decrease complexity in this area of the law. CAMAC concluded that the current definition suitably aligns with market and regulatory perceptions of what constitutes a derivative. The definition is meant to be broad, to allow for its application to new derivative products without disruption to the regulatory structure of derivatives markets. CAMAC also considers that the s 761D definition of derivative is not unduly complex. The report concludes that it is a broad principles-based definition, tempered by specific exclusions and the ability, if necessary, to enact regulations that make further adjustments in response to developments in the market.

Originally Published: 
22/12/2011