Legal Regulation of the OTC Derivatives Transactions on the International Financial Markets

N.S. Pleshakova Legal Regulation of the OTC Derivatives Transactions on the International Financial Markets. This graduate paper is aimed at the examining the regulation of relations on the international financial markets in respect of transactions with OTC derivatives, both in Russian and abroad. The main objectives of the paper are: (a) the studying of the legislative framework governing the scope of derivative financial instruments, as well as an analysis of existing doctrinal views on the legal nature of derivatives; (b) the analysis of the mechanism for formalizing derivatives contracts on the international terminal market; (c) the analysis of possible conflict issues arising on the OTC international markets, ways of overcoming them, and determining the further direction of the development of legal regulation on the international financial markets. Based on this research the following conclusions were made: firstly, discrepancies that exist in doctrine about the nature of derivatives generates insufficient effectiveness of legal regulation, which indicates the importance for further development of regulation framework; secondly, an important role in the formation and development of the stable OTC derivatives market is played by the ISDA and the documentation created by ISDA, that formalize transactions with derivative; thirdly, the bulk of derivatives contracts have a cross-border basis, which determines the possible occurrence of collisions in legal regulation, the mechanisms for resolving them may have special features; fourthly, the excessive profitability of derivatives determines an interest in such instruments by market participants, that causes the urgency and necessity for further research on this topic. Academic Supervisor: Vadim Lipovcev, S.J.C., Lecturer of the Department of Public and Private International Law, Faculty of Law, National Research University “The Higher School of Economics”.