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Conflict of interests in the intermediation of securities

Goal:

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In the provision of services in the capital market, there are numerous situations in which conflicts of interest may arise in the relationships between the parties involved. Despite the existence of the conflict of interests,per se, not imply direct losses to those involved, there are cases in which agents do not adequately manage these conflicts, to the detriment of customers and the market itself as a whole.

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The project consists of studying existing conflicts of interest in the provision of services in the Brazilian securities market, more specifically those associated with the exercise of intermediation activities. After the crisis ofsubprimethe subject has gained importance abroad, but has been little studied in Brazil - at the same time that there are few decisions by regulatory bodies that have deepened the issue.

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Included as more specific objectives of the project:

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  • Describe and analyze the evolution of intermediation activity in Brazil, exploring the functions of intermediaries in the securities market, the structure of the industry and the applicable regulatory evolution;

  • Revisit the concept of securities intermediation, considering the recent context of national and international capital markets;

  • Identify the sources of conflict of interest in the provision of securities intermediation services, both in the Brazilian and international experience;

  • List the points addressed by foreign regulation regarding the conflict of interests and critically analyze the regulatory treatment of the issue in the country, in light of the solutions applied in the main markets abroad;

  • Identify elements that make it possible to assess the effectiveness of the investor protection regime, whether in the action of regulatory and self-regulatory bodies, in the regulations in force or in the internal rules of intermediaries;

  • Present paradigmatic examples of situations with conflict of interests, which may be the subject of discussion.

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Researchers involved:

 

Participating in this research project are Marcos Galileu Lorena Dutra, Viviane Muller Prado and Ezequiel Fajreldines Santos.

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Publications and results:

 

The initial phase of the project is expected to be completed by November 2020.

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