THE FRENCH STOCK EXCHANGE
& RELATED FINANCIALMARKETS
How they operate
and how they are regulated

2009 ANNUAL REPORT OF THE AUTORITÉ DES MARCHÉS FINANCIERS

On the 21st June, Jean-Pierre Jouyet, President of the Autorité des Marchés Financiers, presented the supervisory body’s 2009 Annual Report. The report
is divided into five chapters: 1) The AMF and savers, 2) Service providers, savings products and market infrastructures, 3) Financial operations and the quality of information, 4) Supervision, market discipline, sanctions, 5) Relations between the AMF, the Stock Market, and national, European and international institutions.
Jean-Pierre Jouyet summed up the principal tasks achieved in 2009:

- reinforcement of the protection of savings and the confidence of individual investors thanks to the creation of the Department of Relations with Savers that treats requests made by savers on all subjects pertaining to insurance, banks and savings. This department was created jointly with the Authority de Contrôle Prudentiel and, since the 28th June 2010, has a website and a telephone service to inform and provide orientation to the public;
- creation of a Risk Committee, reinforcement of the control of participants and enlargement of the scope of market supervision ;
- revival of the primary bond issue market, easing of the conditions for market entry of small and medium-sized enterprises;
- participation, both on a national and European level, in the efforts to improve regulation: harmonised definition of “monetary euro” UCITS, regulation of short sales, participation in the elaboration of the AIFM Directive whose aim is to regulate hedge funds.
Finally, Jean-Pierre Jouyet presented the AMF’s priority tasks in the years to come:
- rapid installation of a European market Agency, named ESMA, endowed with real powers;
- regulation of OTC markets and revision of the MIF Directive in order to improve pre and post trading transparency and equitable competition between platforms;
- increase the resources of the AMF that, for the third consecutive year, has a deficit (17 million Euros).

OPENING A LONG ONLY SEGMENT ON THE DIFFERRED SETTLEMENT SERVICE

Announced by a press release of 18.05.2010, the creation of a Long Only segment enlarges access to the differed settlement service to all shares continually listed on the Nyse Euronext in Paris, whose daily volume amounts to at least 100,000 Euros. 93 supplementary securities will thus become eligible for the differed settlement market. Contrary to the other securities on the differed settlement market, the securities belonging to the Long Only segment will not be eligible for the centralised lending-borrowing market. However, investors can benefit from the advantages linked to the differed settlement market according to rules defined by their financial intermediary. The opening of the Long Only segment took place on the 26th May 2010.

OBSERVATORY OF LISTED MEDIUM-SIZED COMPANIES

As announced by Christine Lagarde, Minister of the Economy, on the 25 March 2010, an Observatory for listed medium-sized enterprises was set up on the 5th July. Founded by the Caisse des Dépôts, the Ministry of the Economy, the Autorité des Marchés Financiers, the Bank of France, the MEDEF, the Credit Mediator, MiddleNext and NYSE Euronext, with the participation of the CGPME, Oséo and Paris Europlace, the Observatory of listed medium sized companies has the following principal missions:

- draw up an annual report for the Minister of the Economy on the access of medium-sized companies to the stock market;
- under the direction of the Bank of France and Oséo, write a annual statement about the ecosystem of the listed medium-sized companies and the innovation of these companies;
- organize studies on the access of medium-sized companies to the stock market, in particular with international comparisons, using specialized research organisations;
- ensure the follow up of the promotion of the financial analysis of listed medium-sized companies, today very insufficient.

The Observatory is housed by the Caisse des Dépôts, which presides the Board of Directors. Vice-Presidency is held by the MEDEF, by MiddleNext and by Nyse Euronext. Its annual budget is 150,000 Euros, financed by the founding members, 100,000 of which are to be spent on research expenses.

FORTHCOMING CREATION BY NYSE EURONEXT OF A MARKET SEGMENT DEDICATED TO
RESPONSIBLE FINANCE

In a press release of 06.07.2010, Nyse Euronext and Microfils announced their intention to create, for the first time in the world, an organised market for the listing and trading of bonds whose underlying debt is in international microfinance institutions or solidarity entities, as defined by the LME law (law on the modernisation of the economy). This specific segment of the market, which will be subjected to strict standards of supervision, will offer investors a choice of previously unseen products. Microfilis will ensure the quality of asset sources, the analysis and follow up of these assets, their transformation into saleable securities and their syndication. The opening of this new segment is due in the third quarter of 2010.