Recommendation 1 Recommendation 2 Recommendation 3 Recommendation 4

Recommendation 5 Recommendation 6 Recommendation 7 Recommendation 8

Market selection

Recommendation 1

Securities Systems* have a primary responsibility to their users** and other stakeholders. They must provide effective low cost processing. Services should be priced equitably.

* Securities Systems = depositories, settlement and clearing systems
** Users = customers of the securities system, and all other parties to whom the securities system owes a duty of care

1.	Is the board that governs the depository answerable to its users?	The BSX is a commercial organisation. The board has a duty to shareholders to operate the market in an efficient and cost effective manner so as to encourage participation by all interested parties.
2.	Does any single organisation, or sector (e.g. brokers, custodians, Stock Exchange) have a large voting position at the board of the depository?	No.
3.	Is there cross subsidisation of products (e.g. international services subsidised by local ones or transaction costs subsidised by asset servicing charges)?	The services are priced on a commercial basis.
4.	What process is in place at the depository to ensure that it meets the needs of all its stakeholders (e.g. institutions, broker dealers, retail investors, issuers)?	The BSX and the depository (Bermuda Securities Depository) do not have a monopoly on the provision of services in the Bermuda market. It is therefore in its commercial interest to ensure that the needs of the stakeholders are met.
5.	What is the communications strategy of the depository to its stakeholders and how is this run?	The Bermuda market is currently small. The BSX has an open door policy and is in regular contact with all its users. Depository participants who are also trading members have representation at the BSX Management Committee, which is responsible for ensuring that the market infrastructure operates to internationally accepted norms.