With the advancement of global financial markets and the emergence of an online trading sphere, characterized by deregulation and increased accessibility from the perspective of retail traders, setting up an organization whose task it is to regulate the said markets and to protect investors, became an absolute necessity quite some time ago.
The Financial Futures Association of Japan was set up in 1989, by the Minister of Finance, acting upon the provisions of the Financial Futures Trading Law, promulgated one year earlier.
The primary objectives of the authority are easy to sum up: it protects investors, and it acts towards the promotion of a safe and healthy financial futures industry, through the proper management of regulation and futures firms.
In 1992, the Financial Futures Trading Law was revised and amended, introducing changes which allowed the FFAJ to self-regulate, thus further enhancing its capabilities.
In 2005, the law underwent yet another revision, as a result of which – among other improvements – a mediation system was added, which now allows the FFAJ to settle various disputes between its members and their investors.
In 2007, another major milestone came about in the existence of the FFAJ. The Financial Instruments and Exchange Law (FIEL) was passed, which redefined the legal naming and thus the status of securities and financial futures firms, as well as other investment firms, bringing them all under the umbrella of “financial instruments firms”. Other institutions such as banks were also redefined as “registered financial institutions”.
The FFAJ has been transformed as well, becoming a public interest corporation financial instruments firms association.
The association is obviously not the right target for a shoddy online operator looking to pick up a cheap license. It only has 146 members currently, of whom 142 benefit from full membership, and 4 have special member statuses.
While we’ve already covered the basic mission statement of the organization, it is always worth taking a closer look at its services.
As a self-regulating organization, the FFAJ is keen on promoting self regulation among the futures industry participants too.
To that end, it formulates self regulatory rules for its members and it offers them guidance, as well as auditing services and recommendations.
Investor complaints are very high up on the organization’s list of priorities. The FFAJ always aims to solve such complaints in a timely manner, in full cooperation with its members, as well as the investors making the complaints.
The FFAJ’s industry-growth promoting activities do not entail marketing. Rather, they consist of gathering statistical data and drawing the due conclusions from it. Then, based on these conclusions, the organization puts forward concrete recommendations meant to help with the healthy growth of the vertical.
The FFAJ also handles public relations through its website (http://www.ffaj.or.jp), and it hosts training sessions and seminars. It also issues publications on the financial futures industry.
Given the legal framework under which it operates, the FFAJ is indeed a very serious regulatory authority and membership in it commands prestige and trust.