Global regulators are not proposing any additional standards to protect investors from conflicts created by practices, such as paying for order flow.
The International Organization of Securities Commissions (IOSCO) published a report Monday, which examines the practices being used by market regulators to address conflicts of interest that arise due to the use of incentives for order routing, such as paying for order flow and research bundling.
In particular, the report focuses on incentives paid, or received, by brokers to or from third parties, broker internalization practices; and, the bundling of goods and services, such as research, with broker execution.
In the report, IOSCO concludes that no further work is required at this point, given both the existing regulation in this area, and reforms that are already underway in various jurisdictions, to address these sorts of risks.
In all three areas that are examined in the report, IOSCO says, various jurisdictions are undertaking reforms, including the planned adoption of new trading rules in Europe in 2018, and possible changes to alternative trading system (ATS) regulations in the U.S.
Nonetheless, IOSCO will keep the area under review, and "may consider revisiting these issues at a later stage once new reforms in jurisdictions have taken effect, or if jurisdictions detect new trends or developments that warrant further exploration," the organization says in a statement.