From a legal perspective 2009 was a very eventful year, with the unit fielding questions from the Board of Directors and other AFTI working groups.
With cross-functional groups set up to respond to certain issues (the Madoff affair, the depositary function, the revision of custody account-keeper requirements, etc.), the unit seconded some of its members to these groups, because of the importance of the legal dimension in these matters.
This voluntary coordination was organised in conjunction with the AFTI’s Chief Executive, Karima Lachgar.
The Group was asked to provide analysis, responses to specific questions and contributions on the following subjects:
• Outsourcing and control/audit of essential services (further to work undertaken in 2008)
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Depositary agreements
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Central depositary procedures in the event of the default of a participant in the fixed income market (following the Lehman Brothers collapse)
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General meetings: the issue of attendance certificates
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Custody risk in connection with assets held in foreign countries (validating and enhancing the roadmap to be provided to an external firm)
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Analysis of the European Payment Services Directive (and its relationship with the securities world)
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Transferring ownership of fund units.
In view of the Madoff affair and its consequences for French custody account-keepers, the Legal Monitoring Unit has been heavily involved in
previously unimagined issues. Participation by members has led to fruitful dialogue and helped construct a robust and widely shared position
within the French financial community.