On 25 June 2020, the International Organisation of Securities Commissions (IOSCO) issued a consultation report ‘The use of artificial intelligence and machine learning by market intermediaries and asset managers’.
The consultation report proposes guidance to assist IOSCO members in providing appropriate regulatory frameworks to supervise market intermediaries and asset managers that utilise artificial intelligence (AI) and machine learning (ML).
The proposed guidance consists of six measures that reflect expected standards of conduct by market intermediaries and asset managers using AI and ML. Although the guidance is not binding, IOSCO members are encouraged to consider these proposals carefully in the context of their legal and regulatory frameworks. IOSCO members and firms should also consider the proportionality of any response when considering these proposals.
An annex to the consultation report summarises how a number of regulators are addressing the challenges created by AI and ML.
The deadline for comments on the consultation report is 26 October 2020.