第6回 FIAジャパン オペレーション委員会 議事録（公開版）FIA Japan Operations Committee — 6th Meeting Minutes (Public Version)

Note (Chatham House Rule): This record has been prepared under the Chatham House Rule; statements that would identify individual speakers have been removed. With the exception of the Chair (Shun Yanagisawa), the Secretariat (Tony Crane), the chairs of other FIAJ committees, and the Webmaster (David Wilkinson), neither individual names nor organization names are recorded. No substantive content — what was discussed or decided — has been altered.

Note (Status of this public version): This public version is not a verbatim translation of the Secretariat's internal version. Wording has been deliberately altered to apply the Chatham House Rule. Substantive content — what was discussed and decided — matches the internal version, but word-for-word equivalence is not intended.

Note (Source of the meeting overview and attendee list): The internal minutes for this meeting (the DOCX circulated by the Secretariat) contain no meeting-overview section and no attendee list. The "Meeting Overview" section below and the "Reference: Attendee List" at the end are drawn from the minutes email circulated by the Secretariat on December 1, 2025 (source/minutes/email/第06回_議事録_メール本文.md). The body (Sections 1–5) is drawn from the DOCX.

Meeting Overview

Source: minutes email circulated by the Secretariat (December 1, 2025)

Topic: Legal Organization for Abolition of New/Close Distinction and Standardization of FIFO Logic

1. Details of Legal Basis (Reference) in OSE Brokerage Agreement Standards

The core of the discussion was on how to practically omit the "entry of New/Close distinction on order tickets" required by the Financial Instruments and Exchange Act (FIEA) and exchange rules. A committee member presented detailed interpretations of the following articles.

(1) Principles and Exceptions under the Financial Instruments and Exchange Act

• Cabinet Office Ordinance Article 158 (Matters to be stated in Order Tickets):

  • Principle: Order tickets created by Financial Instruments Business Operators are required to state the "distinction between New (Open) and Settlement (Close)".

  • Exception Provision: A provision exists in the vicinity of Paragraphs 3 and 5 of the same Article stating that for "matters deemed unnecessary to be instructed at the time of order pursuant to the rules of the exchange," the entry may be omitted.

  • Interpretation: The structure is such that if the exchange rules (Brokerage Agreement Standards) provide that "instruction is unnecessary," the obligation to state it on the order ticket under the FIEA is also exempted.

(2) Utilization of OSE Brokerage Agreement Standards Article 9 (Matters to be Instructed upon Entrustment)

It was confirmed that flexible operation is possible under Article 9 of the OSE Brokerage Agreement Standards via the following three paragraphs.

• Paragraph 1 (Principle and "Deemed Instruction"):

  • While instruction is normally required for each order, exceptions are recognized following the "proviso".

  • Item 2: In cases where "the customer has agreed in advance to settle according to a method specified by the customer (e.g., specific FIFO rule)," it is deemed that instructions have been given in accordance with that method. Thereby, individual instructions (New/Close flags) become unnecessary.

• Paragraph 2 (Allowance of Post-Trade Instruction):

  • This provision allows for the distinction between New and Settlement to be instructed retroactively (e.g., by 6:30 PM) if there is an agreement with the customer.

• Paragraph 3 (Deemed New):

  • This provision allows orders to be treated (deemed) as "New" orders if the customer does not provide instructions by a specified deadline.

[Conclusion and Consensus]

• The participants agreed on the interpretation that if the broker and customer "agree on a settlement method (FIFO logic, etc.) in advance (application of Brokerage Agreement Standards Article 9, Paragraph 1, Item 2)," the New/Close distinction per order can be legally omitted.

• This justifies the automatic processing of settlements based on "agreed rules" even in the absence of instructions from the customer.

2. Detailed Discussion on FIFO Logic Standardization

Technical details were finalized based on hearing results from 7 brokers to formulate an industry-standard FIFO (First-In, First-Out) logic as the "settlement method to be agreed upon in advance."

(1) Logic Patterns Discussed

Based on the hearings, combinations of the following elements were primarily discussed:

• Intraday (Day Trade) Priority: Whether to prioritize the settlement of positions built on the same day.

• Date Order: Whether to prioritize older dates.

• Intraday Order: Priority by "Price" or "Time (Time stamp)".

(2) "Pattern 3" as the Standard (Must) Requirement

As a result of the discussion, consensus was formed to make the logic referred to as "Pattern 3" the industry standard (Must).

• Detailed Logic:

  • Intraday Priority: None (Do not prioritize new positions from the current day; allocate purely from past positions).

  • Date Order: Settle in order from oldest date.

  • Intraday Allocation: Allocate from lowest price (Lowest Price First).

• Reason for Adoption:

  • All 7 brokers interviewed (including additional surveys) were already compatible with this logic.

  • Since some brokers do not support "Intraday Priority (Pattern 1, 2)" or other irregular logics, those would hinder standardization.

(3) Exclusion of "Time Priority (Time stamp)"

A negative conclusion was reached regarding the use of "Transaction Time" as the settlement order within the same day.

• Reason: The precision of time stamps (seconds vs. milliseconds, etc.) varies by system, and some systems do not retain them, which tends to cause matching discrepancies (Unmatch).

• Decision: The standard logic specifications will not consider "Time" and will be determined solely by "Date" and "Price."

(4) Future Operational Policy

• Limitation of Options: While making "Pattern 3" mandatory, the policy is to narrow down options to meet customer requests (e.g., highest price order) to about 2-3, and treat other excessive customizations (Patterns 5, 6, etc.) as "Not Recommended" or "Out of Scope."

• Agreement Form: A template for a "checkbox-style agreement" to select this standardized logic will be created to establish a flow for exchange at the time of account opening.

Topic: Standardization of Average Price Calculation, Impact on JSCC Reporting, and Future Roadmap

3. Detailed Discussion on Average Price Calculation Method

To resolve the long-standing issue of discrepancies (unmatches) in Average Price calculations in the Japanese futures market, the current status was organized, and a policy for formulating guidelines was decided.

(1) Background and Current Issues

• Divergence in Calculation Methods: Two types of average price calculations exist: the global standard "Unit Price Method" (calculate and round each time) and the "Amount Method" mainstream in Japan (match the total execution amount with the final amount). This difference causes discrepancies in calculation results.

• Variations within Amount Method: Even within the "Amount Method" considered the standard in Japan, there are variations in detailed calculation logic (such as timing of rounding) among vendors and brokers, causing 1-yen discrepancies, making standardization urgent.

• Perspective of Global Asset Managers: When global asset management companies enter the Japanese market, they face a double standard where calculation results differ by account location—using the "Unit Price Method" for overseas accounts but being forced to use the "Amount Method" for domestic accounts—which was viewed as problematic.

(2) Discussed Direction and Agreed Items

• Short-term Practical Solution (Listing Both Methods):

  • Unifying immediately to the global standard (Unit Price Method) is difficult due to the significant impact on existing systems.

  • Conclusion: The guidelines will list both the "Amount Method" and "Unit Price Method" and leave them as options. However, a draft will be created defining detailed calculation logic (formulas, rounding processes, etc.) to ensure calculation results match perfectly when either method is selected.

• Mid-to-Long-term Goal (Unification to Global Standard):

  • The direction indicated is that, in the medium term, the aim should be to unify to the global standard "Unit Price Method."

  • While the ideal is for the Exchange (OSE) to support Average Price calculations natively, the response from the committee member was that "there are no plans at present, but they may support it if there is strong demand from the industry."

• Positioning of Guidelines:

  • Since existing JSDA (Japan Securities Dealers Association) rules presuppose equities and lack details specific to futures, it is desirable for FIA Japan to create detailed guidelines aiming to add to or supplement JSDA rules.

4. Impact on JSCC (Japan Securities Clearing Corporation) Reporting Operations

Discussions were held on how abolishing the "New/Close" distinction in Front (Order) operations would affect Back Office (Clearing) operations, particularly from the perspective of reporting obligations to JSCC.

(1) The Dilemma of Close-out Reporting and Position Reporting

• Current Status: Currently, securities companies perform daily "Close-out Reporting" (reporting of settled quantity) and "Position Reporting" (reporting of final open interest) to JSCC.

• Issue: If the "Close" flag is removed at the time of order, information on which positions were settled is lost, creating a risk that conventional "Close-out Reporting" cannot be performed.

(2) Discussed Alternatives and Limitations

• Proposal: A proposal was made to abolish "Close-out Reporting" itself and perform only the final "Position Reporting (Net Balance)."

• Barrier (Omnibus Account Issue):

  • While consistency might be maintained with net reporting for proprietary accounts (ISA, etc.), serious problems arise particularly with "Client Omnibus Accounts."

  • In Omnibus accounts, Customer A's Buy and Customer B's Sell are mixed. It was found that simple netting would delete necessary position information (such as two-sided positions) or increase data volume, resulting in complex impacts.

(3) Conclusion: Out of Scope for Now

• Attempting to solve this problem would involve extremely broad and complex discussions, including changes to JSCC systems and impacts on JGB delivery.

• Decision: The issue regarding "Close-out Reporting" will be temporarily removed from the scope of this "Order Distinction Simplification" project, and options to continue the current reporting method (maintaining flags internally within systems, etc.) will be considered.

5. Overall Way Forward and Action Items

As a result of the discussions, document creation to align understanding among stakeholders and the next milestones were set.

(1) Creation of White Paper

• A White Paper summarizing the discussions so far, the location of issues, and proposed improvements regarding the two major themes of "Average Price" and "Close-out (New/Close Distinction)" will be created. (Yanagisawa, Citi)

• This will be shared with stakeholders to serve as a foundation for building consensus across the industry.

(2) Creation of Guideline Draft

• Specifically for Average Price, a guideline draft defining detailed calculation formulas for the Amount Method and Unit Price Method will be created.

• In Charge: GS, MS, Nomura.

• Deadline: Aim to present at the next meeting (around January 20).

(3) Creation of FIFO Logic Agreement Template

• Work will commence on creating a "Consent Form (Template)" to agree in advance with customers on the industry-standard FIFO logic (Pattern 3, etc.).

(4) Next Meeting

• Schedule: Adjusting for around January 20, 2026 (Tuesday) 11:30 AM (3rd Tuesday). Arranged by FIAJ Secretariat.

• Format: Continued holding as a regular meeting.

Reference: Attendee List

Source: minutes email circulated by the Secretariat (December 1, 2025). The internal minutes (DOCX) contain no attendee list.

Individual names are withheld except for the Chair and Secretariat. Participating organizations, attendance mode (in-person/Zoom), and row count are preserved as in the source. The "& team" notation is retained from the source: it indicates that the row covers participants beyond the single named individual.

These minutes are a record of the discussions held during the meeting. Please direct any corrections or amendments to the Secretariat (Tony Crane).