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Impact Assessment (IA) is undoubtedly a key tool of financial regulation and supervision. As a strong supporter of the principle of better regulation, FESE welcomes the opportunity to comment on the draft guidelines published by L3 Committees and considers them a step further towards the objective of ensuring that all regulatory initiatives are introduced only when clear evidence of a need has been established.
It should be noted however that although we strongly support consultations and impact assessments (our experience with Level 3 is so far very positive) and see them as a highly beneficial tool for improving regulation, consultation feedback and impact assessments should not delay a decision to amend regulatory measures when the practical consequences of a measure becomes clear and that such measure appears to be inadequate.
Other than providing practical examples of our experience with Level 3 FSAP directives, we also offer some thoughts on the governance structure and the need that the experts conducting the exercise are fully independent. A reliable IA in fact should be conducted by a 3rd party and, if not, at least by a unit that is separate from that which conceived the IA or the one that implemented its outcome.
