Legal Framework for Regulation of Financial Instruments

Devoid of all technicalities, financial derivatives are basically contracts,whose value is derived from the value of money or other products, called “underlying security”.They came to existence since very long, but came to be known collectively as “financial derivatives from mid 1990’s only. Primary focus of this book is Legal framework for regulation of “financial derivatives”. Financial Derivatives are considered to be the prime reason behind the 2008 financial crisis and the focus of present regulatory efforts. Financial products per se are not bad; it is the greed behind them that make them bad. This book proceeds on the hypothesis that financial instruments, especially financial derivatives have a tendency to overcome regulations, and hence there is need for laying down international standards and norms, through consensus, to ensure a level playing field and reduce chances of fraudulent transactions. A purely doctrinal approach is adopted. Historical analysis, comparative legislative and judicial analysis and studies of international regulation is done to study the general framework for financial regulation, its utility and scope for further change in regulatory architecture.