JSDA as an SRO
Japan Securities Dealers AssociationFebruary 2019

JSDA as an SRO
The Japan Securities Dealers Association (JSDA) is a selfregulatory organization (SRO). The JSDA also works as aninterlocutor for the securities industry, but independently andseparately from its SRO function.
As a fully empowered SRO, the JSDA extensively regulates
market intermediaries. Its self-regulatory functions encompass
rule-making, enforcement, inspection, disciplinary actions,accreditation of sales representatives, and dispute mediation.
The JSDA is also actively engaged in various activities promoting
financial literacy through partnering with other organizations andgovernment agencies.

Activities as an SRO
Functions

OutlineRule-making

Establishing self-regulatory rules
applicable to member firms such as
those for their conduct, products,
transactions and internal control,and making these rules known(Article 67-8, Paragraph 1, Item 10of the Financial Instruments andExchange Act (FIEA))

Monitoring and inspecting
members(Article 67-8, Paragraph 1, Item 14of FIEA)

Disciplinary actions(Article 68-2 of FIEA)

Members of theSelf-regulation Board*1
Chair of Self-regulation Board (appointed from among thePublic Governors by General Assembly)*2
1 person
Public Board Members (appointed byGeneral Assembly)
4 persons to represent the public interest
Regular Board Members (elected by and fromRegular Members*3)
Not more than 4 persons who can provide their views andexpertise from Securities Broker-dealers
Special Board Members (elected by and fromSpecial Members*4)

Conducting inspection andmonitoring of members’ businessactivities, compliance with laws
and regulations, as well as internal
control systems

Not more than 2 persons who can provide their views andTaking disciplinary actions such asa reprimand, fines, suspension orlimitation of membership, as well as
expulsion of member firms violatinglaws or self-regulatory rules

1 personexpertise from banks, insurance companies, etc.
JSDA Chairman

JSDA Vice Chairman & Chief Operating Officer
for the Self-regulation Board
1 person

Improving the proficiencyof members’ officers andemployees(Article 67-8, Paragraph 1, Item 9of FIEA)

Complaint handling andmediation(Article 67-8, Paragraph 1, Item 11of FIEA)

Granting accreditation of securitiessales representatives andemployees responsible for internalcontrols and raising their proficiency
through capacity building
Handling complaints from investors
and conducting mediation toresolve disputes between member
firms and their customers(These activities are entrusted to
the Financial Instruments Mediation
Assistance Center (FINMAC))*1

A maximum of 13 persons

2*

One or a few vice chairs is/are to be appointed from among*3

Securities firms*4Banks, insurance companies, etc. conducting securities

Self-regulation Board Members

businessSelf-regulatory Structure of JSDA
Self-regulatory Function

General Assembly
Nominations Committee
for Self-regulation Board

Self-regulation
Board- Disciplinary Committee

Board of Auditors

Board of Governors

Securities
Strategy Board
General Affairs
Committee

Code of Conduct
Committee- Sales Representative
Disciplinary Committee- Self-regulatory Planning
Sub-Committee

Financial Literacy &Education Support
Committee

Head Office- Equity Sub-Committee

Policy Making HQInternational Affairs Div.

Self-regulation HQ- Financial Instruments
Sub-Committee

Inspection HQ- International Advisory
Committee

Qualification &Discipline HQ

Administration HQ

Firewall- Bonds Sub-Committee

Financial Literacy &Education Support HQMember Relations HQ

Sales Representative
Examination Committee

IOSCO Affairs Office

SDGs Promotion HQ

Securities Trading Safety Net for Individual Investors(1) Dispute resolution
service provided by the
Financial Instruments
Mediation AssistanceCenter (FINMAC)(2) Compensation Scheme
provided by Japan
Investor Protection Fund(JIPF)

In case of Insolvency
Indemnification up to
10 million yen

JIPF
Provision of a loan forrestitution of investors’ asset

IndividualInvestor
DisputeMarketIntermediaries

Provision ofArbitration/MediationADRFINMAC
FINMAC is a designatedalternative dispute resolution
for securities transactions, etc.

Self-regulatory Structure for Securities Firms
JudiciairyAuthorities

FSA
Financial Services Agency
Securities and Exchange
Surveillance Commission
Delegation ofregulatory power

Subject tosupervision

Information
sharing

Inspection of SROs

Financial Instruments
Exchanges

SROs(Stock Exchanges)- Inspection focusing on Self-regulatory rules- Surveillance & monitoring of securities market

Securities Broker-dealers
Banks, insurance companies, and other financial institutions
conducting securities business- Inspection focusing on
compliance with FIEA
- Market oversight

Securities-related SROs in Japan
Financial Services Agency(FSA)

Financial
Instruments
Exchanges
SRO

Exchange members(Securities companies)
Listed companies
Market participants

SRO

Securities Firms,
Registered Financial
Institutions (banks,insurance companies,etc. conducting
securities business)

Japan Investment
Advisors
AssociationThe Investment
Trusts Association, Japan

Financial Futures
Association of Japan

SRO

SRO

SRO

SRO

Financial futures
broker dealer

Investment advisers

Type-IIfinancial
instruments firms

Investment trust
companies
Investment trustdistributors

Financial Instruments Firms Association

Type ll Financial Instruments
Firms Association

International Activities
In response to the globalization of the securities markets, theJSDA actively participates in international conferences andexchanges information to deepen relationships withoverseas organizations related to the securities industry.
The JSDA is now involved in a number of international
forums including the International Organization of Securities
Commissions (IOSCO), the International Council of Securities
Associations (ICSA), the Asia Securities Forum (ASF).

Head Office
Address: 2-11-2, Nihombashi, Chuo-ku,
Tokyo 103-0027 JapanTel:+81-3-6665-6764

Fax:+81-3-6665-6808

Website: www.jsda.or.jp/en/index.html