The Bank of International Settlements, known as the central bank of central banks, has released a new global code of conduct to restore confidence in the foreign exchange (FX) market.

In the 78-page code, the institution acknowledged that some forms of information sharing are crucial for an "open, liquid and appropriately transparent" market and that central banks need banks to open up. The new code of conduct is complementary to an earlier version that was revealed a year ago. Not designed to replace local laws, the code lays out 55 principles setting forth common standards for a highly irregulated and fragmented market. It sets out standards for conduct and behavior across all levels of the world's largest and most liquid market, where deals worth 4.74 trillion euros are traded on daily basis.

The code targets key dealer banks that are granted six to 12 months to get their systems in line and are aiming for full compliance. They and other market intermediaries have signaled strong support for the initiative.

"The Global Code does not impose legal or regulatory obligations on Market Participants nor does it substitute for regulation, but rather it is intended to serve as a supplement to any and all local laws, rules, and regulation by identifying global good practices and processes," the release said. The reputation of the global FX market has been hit after banks and brokers paid billions of euros of fines, around 8.93 billion euros, for trying to share information for their mutual benefit, especially around benchmarks. The new code is expected to rebuild trust in the regulatory bodies and investors, particularly just a few days after France's BNP Paribas became the latest bank to receive a fine for four years of "nearly unfettered misconduct" in currencies.

BNP Paribas SA on Wednesday agreed to pay a $350 million penalty to resolve allegations by New York's banking regulator that foreign-exchange traders at the French bank engaged in collaboration for currency manipulation.

The recommendations warned that market participants had to be clearer in their communications and protect confidentiality, but they should divulge information requested by a central bank "acting for policy purposes." The Global Code is organized around six leading principles in areas such as ethics, governance, information sharing, execution, risk management, and confirmation and settlement process.