NEWSFLASH

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SEC TIGHTENS RULES ON FUTURES TRADE

Manila, Oct. 13, 1997 - The Securities and Exchange Commission (SEC) is imposing strict conditions before allowing futures trading in the country.

Just last June, the SEC revoked the license of the Manila International Futures Exchange (MIFE) after a string of irregularities and fraudulent transactions. Other business groups then tried to open a new futures market; two applications to take over the MIFE are now under review by the SEC.

If the SEC decides to allow the operations of a futures exchange, the entity will be required to draw up its own regulatory framework prior to registration. SEC legal department chief Lucila Decalla said the requirements will include: exchange guidelines and qualification for acceptance of membership, business conduct rules, trading rules to prevent trading abuses, adequate accounting traits, surveillance, compliance and enforcement system and customer protection program.

The exchange should also have the backing of a competent and independent clearing house to protect investors, Decalla said.

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