SIX Swiss Exchange has the legal mandate to maintain an independent regulatory and monitoring organisation: SIX Exchange Regulation is an independent and autonomous entity within the SIX Group that reports directly to the Chairman of the Board. This ensures that autonomy prevails in relation to the exchange's operating activities.
Self-regulation means that the market participants themselves (in the case of SIX, mainly issuers and trading participants) establish the rules for exchange trading. The Swiss Financial Market Supervisory Authority (FINMA) must approve these regulations; SIX Exchange Regulation is then responsible for ensuring that issuers and trading participants comply with them. In addition, the self-regulation system at SIX also includes dedicated judicial bodies, which impose sanctions on market participants if they breach the exchange's rules.
Self-regulation: How Issuers, Trading Participants and Investors Benefit
There are numerous reasons why the Swiss Exchange is an attractive venue for market participants throughout Europe. (Here is where Chris Landis, the Head of Swiss Exchange, explains, for example, the benefits of the highly modern infrastructure at SIX).
Self-regulation is also a reason why the Swiss Exchange is so appealing, because issuers, trading participants and investors benefit:
Listed companies must meet demanding requirements regarding transparency, corporate governance and creditworthiness. This includes updating their investors regularly and comprehensively, or if needed, on an ad hoc basis. Questions often arise during the listing process, or issuers have company-specific discretion regarding disclosure obligations. (For further information, please also read the interview with Katharina Rüdlinger, Special Counsel and former Head of Corporate Disclosure at SIX Exchange Regulation). SIX Exchange Regulation advises and supports issuers, beginning during the listing process and then throughout their entire time on the exchange. Close, market-based contact helps companies to master successfully the complex legal and communication requirements associated with a market listing. In addition, SIX Exchange Regulation will probably take on the responsibility of reviewing prospectuses from 2019 onwards. That will further simplify the issuance of international bonds on SIX Swiss Exchange (for more information on the new listing process under FIDLEG and the responsibilities of the reviewing body, refer to).
- Trading participants
Trading participants on SIX Swiss Exchange generate every day 230,000 trades on average and enter 35 million orders into the order book. These immense figures make it a challenging task to monitor trading and ensure it is conducted in compliance with the regulations. The Surveillance & Enforcement unit monitors trading on SIX Swiss Exchange so that violations of the exchange's regulations, as well as insider trading, market/price manipulations and other breaches of the law, can be identified and corresponding measures taken or initiated. This unit is also in close contact with the supervisory authority FINMA and the competent criminal prosecution authorities.
Investors benefit from self-regulation just as much as issuers and trading participants. The close advice and specialist support that SIX Exchange Regulation provides for issuers ensures not only the high quality of listed securities, but also that the market receives continuous and correct information. Effective and efficient surveillance of trading uncovers potential irregularities. It additionally ensures that trading and price formation on SIX Swiss Exchange are transparent and in accordance with the regulations.
A well-functioning financial market is essential for Switzerland's economy. The exchange is the centre of the capital market. It is therefore important that regulation works well so that investors trust the exchange. This then increases its liquidity significantly and thus contributes to the competitiveness of the exchange. The self-regulation of the exchange has proven its worth: it is a market-based, flexible and high-quality system that is based on years of experience.
Corinne Riguzzi has been the Head of SIX Exchange Regulation, the self-regulation authority of the Swiss Exchange, since 1 January 2017. The 43-year-old lawyer, who has been admitted to the bar and holds a Master of Laws (LL.M), has been involved with the monitoring of trading since 2006. In August 2012 she assumed overall responsibility within SIX Exchange Regulation for the monitoring of trading. Since then she has been a Member of the Management Committee. Corinne Riguzzi participates in the IOSCO Affiliate Members Consultative Committee and has in-depth knowledge of the entire spectrum of self-regulation and its governing bodies.