Upon completion of this course, participants will be able to:

• Analyze the legal definition, categorization, and **systemic importance** of various types of Financial Market Infrastructures (FMIs).
• Explain and apply the **CPMI-IOSCO Principles for Financial Market Infrastructures (PFMI)** to different FMI types (e.g., RTGS, CCPs).
• Understand the legal basis for **finality of settlement** and the enforceability of netting arrangements across jurisdictions.
• Evaluate the central bank's triple role as **operator, overseer, and user** of FMIs and the management of potential conflicts.
• Examine the legal and policy frameworks for FMI **Recovery and Resolution Planning (RRP)**.
• Assess the legal and regulatory challenges of emerging FMIs, such as DLT-based payment systems and CBDCs.
• Formulate a framework for national self-assessment and compliance with the PFMI.
• Analyze the legal risks associated with cross-border FMI links and interoperability arrangements.

• Legal Counsel and Compliance Officers at Central Banks and Regulatory Agencies.
• FMI Oversight and Policy Specialists.
• Heads of Payments Systems and Securities Settlement Departments.
• Banking Supervisors and Financial Stability Analysts.
• Senior Management involved in International Regulatory Standards.
• Internal Auditors focused on FMI Governance and Compliance.

• Moot Court Simulation: Debate on Legal Finality of Settlement during a Crisis
• Group Activities on Assessing a Hypothetical FMI against the PFMI Principles
• Case Studies on FMI Recovery and Resolution Plans and Stress Scenarios
• Expert Lectures on Cross-Border Netting Enforceability and Collateral Law
• Discussions on Managing the Conflict of Interest in the Central Bank's FMI Roles
• Individual Assignments on Drafting a National FMI Oversight Policy Statement

Unit 1: FMI Categorization and Legal Foundations

• Defining FMIs: payment systems, CSDs, SSSs, CCPs, and Trade Repositories.
• Legal mandate for FMI operation and oversight: central bank authority and legislative acts.
• The legal basis for **settlement finality** (e.g., PSS Directives) and the time of settlement irrevocability.
• Analysis of netting and collateral enforceability under national and cross-border laws.
• Case studies on legal challenges to FMI settlement finality during crises.

Unit 2: The Principles for Financial Market Infrastructures (PFMI)

• Detailed review of the PFMI's risk management principles (credit, liquidity, operational risk).
• The governance and transparency principles (PFMI 2-4) and their application.
• The principles relating to default management, margin, and collateral (PFMI 5-9).
• Implementation challenges and policy options for achieving compliance with the PFMI.
• The role of the PFMI in promoting financial stability and efficiency.

Unit 3: Oversight Framework and Central Bank Roles

• The central bank's oversight mandate: objectives, scope, and tools (e.g., regulation, inspection, sanction).
• Managing the potential **conflict of interest** when the central bank is both the operator (RTGS) and the overseer.
• The relationship between FMI oversight and micro-prudential supervision.
• Regulatory reporting and disclosure requirements for systemically important FMIs.
• International coordination on FMI oversight and cross-border risk management.

Unit 4: FMI Recovery and Resolution (R&R)

• The concept of FMI **Recovery and Resolution Planning (RRP)** and its regulatory mandate.
• Developing credible and testable recovery strategies for FMI operators (e.g., loss allocation, liquidity tools).
• Resolution tools for FMIs and the resolution authority's legal powers.
• The role of the central bank in providing financial support to an FMI in resolution.
• Cross-border RRP challenges and information sharing protocols.

Unit 5: Legal Challenges of New FMI Technology

• Assessing the legal status of **tokenized assets** and DLT-based settlement finality.
• Legal and policy implications of Central Bank Digital Currency (CBDC) for existing FMI laws.
• Regulatory sandbox models and the legal framework for testing new FMI technologies.
• Legal issues of data sovereignty, privacy, and cyber security in a distributed ledger environment.
• Future-proofing FMI laws to accommodate continuous technological innovation.