The National Commission for Securities and the Stock Market of Ukraine has published a plan for development of commodity markets in Ukraine, including the gas and power markets, based on the concept of energy hubs. The press service of the commission reported that the plan was developed with participation of an international group of experts in line with the standards of the EU Energy Community. The commission said that the implementation of current reforms, in particular the gas market and the electricity market, does not take place in an integrated manner. It does not provide for the creation of a full-fledged payment system, such important aspects as ensuring pricing on competitive principles, requirements for the organization of trade, the activities of stock exchanges, which causes significant risks of non-payment and pose a threat to financial stability, according to the commission.
One of the main prerequisites for successful reform is the distribution of responsibilities between regulators – core (regulating the conditions and rules for the physical movement of goods) and financial (financial aspects of trading and conditions for using financial tools).
“We do not offer another energy reform. We have developed a mechanism for implementing previous reforms: the gas market, the electricity market. Reforms that started with good intentions, but without taking into account the need to develop the accompanying financial infrastructure, were implemented distortedly: one is not completed, the second is proposed to be delayed both by the regulators and market players, because it threatens to collapse the system. This happens because the markets do not function as intended. They still need administrative “manual control,” because it does not ensure compliance with its primary function – to establish a balance between buyers and vendors, they are not transparent, competitive,” Head of the commission Tymur Khromaev said.
Khromaev said that the model developed by the commission will make it possible to balance the commodity markets, ensure the establishment of fair prices, and increase the efficiency and competitiveness of the country’s economy.
In particular, the commission’s plan implies amending the law on securities and the stock market to expand trading tools on the stock exchange, which will open up the segments of energy products in accordance with the law.
A concept of regulating transactions with cryptocurrencies names the National Commission for Securities and the Stock Market of Ukraine the main regulator on the cryptocurrency market and authorizes the commission to license cryptocurrency exchanges and cryptocurrency exchange points, according to materials posted on the website of the commission. In particular, it is proposed that the National Commission for Securities and the Stock Market will classify and define tokens as financial tools, regulate the exchange and purchase and sale of cryptocurrency through cryptocurrency exchanges, as well as Initial coin offerings (ICO).
At the same time, according to the concept, State Financial Monitoring Service is authorized to supervise cryptocurrency exchanges, and the Ministry of Finance and the State Fiscal Service – to supervise payment of taxes on income from operations with cryptocurrencies.
In addition, the concept proposes to define the concept of a cryptocurrency and a token. In particular, the token is proposed to be considered a “centralized or decentralized unit of accounting, which is based on mathematical calculations using a computer network and has cryptographic protection.” “Cryptocurrency is a token that functions as a way of exchanging and preserving value,” the commission said on the website.
The assets of insurance companies placed in the instruments of the stock market in January-March 2018 amounted to UAH 11.326 billion, which is UAH 2.625 billion, or 18.8% less than in the same period in 2017, member of the National Commission for State Regulation of Financial Services Markets Oleksandr Zaletov has told Interfax-Ukraine. According to him, due to regulatory requirements and stagnation of the national stock market, the volume of shares and corporate bonds in the structure of insurance companies’ assets is steadily declining. In the first quarter of 2018, investments in shares decreased by 23.7% compared to the same period in 2017, or by UAH 1.746 billion, in corporate bonds by 13.7%, or by UAH 126.5 million.
At the same time, Zaletov notes the growth of investing of insurers’ funds in government domestic loan bonds continues – by 15.5%, or by UAH 859.9 million. At the same time, income from investments in government domestic loan bonds for the period increased by 29%.
“The stability of the hryvnia and higher interest rates contributed to the growth of insurers’ national currency investments both in deposits and current accounts. But this did not save from the decline in the yield of this category of assets by 6.8%. In addition, investment in the economy of the country in the areas defined by the government rose by 54.8%, or UAH 150.5 million,” the expert said.