IOSCO Consults on Commodity Derivatives Good Practice

Tapping into a hot topic, The International Organization of Securities Commissions (IOSCO) has published a Consultation Report on Good Practices concerning OTC Commodity Derivatives Markets.

This report invites comments on proposed good practices intended to support the effective implementation of IOSCO’s Principles for the Regulation and Supervision of Commodity Derivatives Markets, with a particular focus on strengthening the implementation of Principles 12, 15, and 161 in the context of related OTC markets.

The organisation says that feedback, which is open until June 19, 2026, will inform the final report, which will provide guidance to support effective implementation of the principles and strengthen the integrity and stability of global commodity markets.

Explaining why it has launched the consultation, IOSCO says commodity market participants often hold positions across exchange-traded, OTC and physical markets. “This interconnectedness can affect price formation, increase volatility, and heighten the risk of market abuse, particularly where market authorities lack visibility over large, concentrated positions,” it states. “Effective oversight therefore depends on timely access to comprehensive information across related markets, timely intervention, and increased information sharing and cooperation between regulators.”

The report proposes a set of good practices that will specifically strengthen three existing principles, in relation to the collection and aggregation of OTC derivatives data, including beneficial ownership, to support effective surveillance, alongside enhanced information-sharing and cooperation between exchanges and regulators, and among regulators, particularly in times of stress.

A second aim is to set expectations about the timely regulatory intervention to prevent or address disorderly market conditions, particularly where risks in OTC markets may spill over into exchange-traded markets, supported by transparent intervention policies and improved information flows.

Equally, IOSCO seeks to promote proportionate, risk-based, and market specific approaches to OTC data collection and intervention powers.

“IOSCO is committed to promoting resilient and fair commodity derivatives markets globally,” says Jean-Paul Servais, chair of the IOSCO board. “By consulting on these good practices, we are seeking to support consistent and effective implementation of the principles in a way that is proportionate to risk and adaptable to different market structures.”

Carol McGee, chair of IOSCO’s committee on derivatives, adds, “As commodity markets become more interconnected, regulators need the right tools and information to identify and respond to emerging risks. This consultation sets out practical good practices to support effective supervision of OTC markets and to safeguard market integrity.”