"This framework recognizes that the health of our respective economies is inextricably connected through trade and cross-border investment flows within the transatlantic economy and capital market," said David Strongin, SIA’s vice president and director of international finance.
"This is an important complement to the U.S.-European Union Financial Markets Dialogue in achieving convergence in the regulatory approaches governing capital markets within the United States and the EU,” Strongin said. “By doing so we can broaden access to capital in both regions without in any way diminishing investor protections. Different and duplicative regulation only complicates the ability of firms and their customers to conduct business efficiently and to provide low-cost products and services to clients.”
In the announcement, the SEC and CESR identified the following areas of focus: market structure issues; the future of mutual-fund regulations; the development of an infrastructure to support International Financial Reporting Standards; and, the regulatory risks of the U.S. and EU securities markets.
SIA strongly supports the dialogue and has commended efforts by the U.S. Treasury Department and the Internal Market Directorate General of the European Commission in enhancing and strengthening the transatlantic capital market, Strongin said.
SIA has called for discussions between the SEC and CESR, and has identified several areas warranting a minimization of regulatory differences that, if achieved, would improve the efficiency of the transatlantic capital market. These include:
- Public offering documents in the U.S. and EU markets (beginning with non-financial disclosure, such as the “management discussion and analysis” section, reporting of beneficial ownership, real-time event disclosure);
- U.S. and EU broker-dealer registration requirements;
- Credit-rating agencies’ rules;
- International anti-money laundering standards (promoting uniformity, cooperation, and efficacy, beginning with the ability to rely on financial intermediaries across borders to perform “due diligence” requirements, such as customer identification); and,
- Corporate governance standards.
