The Banking Regulatory and Supervision Agency (BRSA) will review the rules of market manipulation that came into force last year under former Finance Minister Berat Albayrak. According to Reuters, citing five different sources, the BDDK decided to change the regulation after criticism that the banking sector was “ambiguous” and “open”. The reform, which began in November after a change in economic governance, and an amendment that is in line with market-friendly rhetoric, are expected to target EU standards in this area.
Under an amended regulation last May, those who spread false and misleading information in the financial markets would be punished. However, the regulation has been criticized for not being clear about the nature of the crime.
The power to “detect manipulation” in the BDDK
Work with banks and other institutions
“Last year, work was underway on BDDC rules that define manipulation, fraudulent transactions and applications in financial markets,” he said.
“The issue on the agenda is to change the rules, which in practice is a cause for concern and cause problems,” he said, adding that the study was conducted in collaboration with banks and other institutions. On the other hand, the BSEC refused to officially comment on the matter.
According to sources, there will be no need to change the law to change the regulation, which aims to eliminate uncertainty. A senior bank official stressed that the regulation covers many elements that are far from EU requirements and open to interpretation. “An arrangement is being made to make the open parts more concrete,” he said.
Criticism of regulation
The existing 11-item regulation has raised concerns that it contains overly general definitions of what is assessed as regulation, manipulation and market speculation, and may even have a negative impact on standard currency transactions in the market.
“The purpose of BDDK regulation is ambiguous”
The regulation on “Manipulation and Misleading Operations in Financial Markets” prepared by the BSEC was published in the Official Gazette on May 7, 2020 and entered into force.
One of the controversial and explicit provisions in the regulation is: “To create or cause a false or misleading impression about the supply, demand or price of a financial instrument, or to keep the exchange rate and interest rates of the financial instrument at an abnormal or artificial level. to participate in operations that may provide, to mediate, to order such operations or to carry out similar activities. ”
Berat Albayrak resigned from the post of Minister of Treasury and Finance after being replaced by President Recep Tayyip Erdogan, Governor of the Central Bank. The change of office in the Central Bank and the resignation of Albayrak coincided with a period of gradual depreciation of the Turkish lira.