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applying better regulation to the financial markets in 2009 January 28, 2009

Posted by Bradley in : Uncategorized , trackback

The EU Commission published its latest strategic review of Better Regulation in the European Union (COM(2009)15 (EN) (28 January 2009)) today. But it’s unclear how this applies in the context of the financial markets right now. For example, the document states:

Improving the quality of new initiatives is an essential part of the better regulation agenda. In line with international best practice, the Commission believes that the most effective way of creating a better regulation culture is by making those people who are responsible for policy development also responsible for assessing the impacts of what they propose.

Better stakeholder consultation is an aspect of this, and the document states that “For complex or sensitive proposals, Commission departments are encouraged to go beyond the 8 week minimum consultation period”. But responding to crisis has been used recently as a justification for not consulting extensively (for example with respect to the regulation of CRAs). And Charlie McCreevy’s critique of the acceptance of the use of value at risk models in prudential regulation is an implicit critique of over-reliance on the sort of stakeholders who express views about proposals for financial regulation.

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