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EU securities regulation has embarked on an unprecedented movement
towards regulatory convergence, which is seen as necessary to facilitate a
single capital market. The relevant new Directives generally provide for
comprehensive coverage of regulatory standards, as distinct from the old
approach of minimum harmonization. The rationale is that, in order to
encourage freedom of movement for issuers, intermediaries and investors, the
EU needs to provide a level playing field with a sufficiently robust
regulatory regime that is sufficiently comforting to investors. The pursuit
seems to envisage a level of similarity in securities regulation in all EU
Member States that approximates to uniformity. However, to what extent Member
States’ laws should achieve uniformity or near-uniformity is not clearly
This outstanding book offers a new approach to the legal issues raised by the
drive for convergence in securities regulation. The author offers a deeply
informed and insightful examination of the implications for regulatory and
policy design if regulatory convergence were to be rigorously implemented.
After setting the development of the idea of regulatory convergence in
historical context and defining what the term means, she goes on to
investigate the web of legal issues surrounding the concept and its
implementation, including the following:
the benefits and drawbacks of the existing regulatory competition between
ground-up (waiting for divergences to evolve through competitive processes)
versus top-down mandatory convergence;
regulation of intermediaries;
the regulation of financial market transparency (visibility of pre-trade and
post-trade information) and its effect on the business model of stock
exchanges and markets;
interpretations of market abuse in Member States;
the rise of multilateral trading facilities (MTFs);
theories on multi-speed clustering among like-minded Member States;
the role of the Committee of European Securities Regulators (CESR); and
the relationship of national penalties and enforcement convergence.
Arguing that the current patchwork of primary Directives and Commission
Regulations is unlikely to secure convergent textual law, the author suggests
that a rigorous pursuit of regulatory convergence should be based on adopting
a systemic structure in designing regulatory features to achieve convergence.
She proposes that regulatory convergence should capture four aspects of the
law sources of law, interpretation and administration, supervision of
compliance, and enforcement through an overarching ‘cybernetic’ model which
focuses on the selection, transduction, and effectuation of norms, as well as
on information and feedback processes and securing compliance with the norms.
Although many authorities recognize that there are insufficient systemic
features in the current framework to achieve regulatory convergence in EU
securities regulation, this book takes a giant step beyond procedural
discussion into a deep analysis of the underlying need for legal integrity in
this administrative field at the EU level if policy objectives are to be
achieved or even clearly argued. It will be of great interest to practitioners
and policymakers working in securities, competition, and related fields.
Acknowledgements. Abbreviations. Tables. 1. EU Securities
Regulation So Far. 2. Conceptualizing Regulatory Convergence in EU
Securities Regulation. 3. Examining Regulatory Convergence in the
Sources of Law. 4. Regulatory Convergence in Law in Action. 5.
Is there an EU System for EU Securities Regulation? 6. Regulatory
Divergences amongst Member States. 7. A Systemic Approach towards
Regulatory Convergence in EU Securities Regulation. 8. Conclusion.