SELF-REGULATORY ORGANISATIONS AS MARKET REGULATORS WITH DELEGATED POWERS: COMPARATIVE ANALYSIS OF THE LEGISLATIVE FRAMEWORK

Abstract

The purpose of this article is to identify exemplary and suboptimal approaches of certain countries to determination of the scope of public powers delegated to self-regulatory organisations as well as of means designed for ensuring efficient execution of these delegated powers in accordance with the norms of administrative law. Relying on comparative and systematic review methods, as well as on techniques of text analysis, the main legal contours of the model of self-regulation regulation of economic activities in particular areas (securities market, advertising and anti-money laundering), established by the legislation of certain countries (Germany, Ontario, the United Kingdom, the USA and Switzerland), are outlined. The authors conclude that self-regulatory organizations may be entrusted with the following delegated powers: (1) to register business entities or issue them permits, including after verifying their compliance with the eligibility criteria stipulated by regulatory legal acts (United Kingdom, USA, Switzerland); (2) to develop binding rules (standards) for the respective type of economic activity (USA, United Kingdom, Ontario, Switzerland); (3) to submit mandatory requests for the provision of information that is necessary for a self-regulatory organization to perform its functions (Lithuania); (4) impose liability measures on business entities that are members of a self-regulatory organization (United Kingdom, USA, Switzerland). Government control (supervision) over activities of self-regulatory organizations is carried out through: (a) approval/approval by regulatory authorities of the constituent documents of self-regulatory organizations, rules and standards for the activities of self-regulatory organizations, initiation of amendments to them, independent decision-making on this matter after consultation with the self-regulatory organization; (b) participation in meetings of executive bodies and disciplinary bodies of the self-regulatory organization on issues of its exercise of its delegated powers; (c) review by regulatory authorities of regulatory acts of self-regulatory organizations and/or their decisions on imposition of liability measures on business entities; (d) sanctioning self-regulatory organizations for violations of legislative requirements (including in connection with the systematic failure to ensure complianc by their members) or due to their failure to meet the performance indicators of their activities.