Pan-European Securities Markets: Policy Issues and Regulatory Responses

European Business Organization Law Review

Volumn 3, Issue 2, 2002, Pages 249-292

  Ferrarini, Guido A ^a  

^a UNIVERSITY OF GENOA   (Italy)

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EID: 84929753948     PISSN: 15667529     EISSN: 17416205     Source Type: Journal    
DOI: 10.1017/S1566752900000926     Document Type: Article

References (209)

1. H. Baum, “Globalizing Capital Markets and Possible Regulatory Responses”, in: J. Basedow and T. Kono (eds.), Legal Aspects of Globalization. Conflict of Laws, Internet, Capital Markets and Insolvency in a Global Economy (The Hague/London/Boston: Kluwer Law International 2000) pp. 77–132, at p. 99: “These activities are located below the level of formal legal harmonisation and can be described as harmonisation from below”.
2. See M. Giovanoli, “A New Financial Architecture for the Global Financial Market: Legal Aspects of International Financial Standard Setting”, in: M. Giovanoli (ed.), International Monetary Law: Issues for the New Millennium (Oxford: OUP 2000) pp. 3 et seq.
3. See N. Moloney, EC Securities Regulation (Oxford: OUP 2002), chapter 1
4. P.O. Mülbert, “Konzeption des europäischen Kapitalmarktrechts für Wertpapierdienstleistungen”, WM, Wertpapier Mitteilungen (2001) 2085, at 2092 et seq.
5. See H. Baum, WM, Wertpapier Mitteilungen n. 1, p. 105.
6. WM, Wertpapier Mitteilungen, p. 108.
7. See E. Wymeersch, “The Harmonisation of Securities Regulation in Europe in the New Trading Environment”, in: E. Ferran and C.A.E. Goodhart (eds.), Regulating Financial Services and Markets in the XXIst Century (Oxford: Hart 2001) p. 189
8. G. Hertig, “Regulatory Competition for EU Financial Services” 3 J. Int. Ec. Law (2000) 349.
9. L.J. White, “Competition versus harmonization-An overview of international regulation of financial services”, in: C. Barfield (ed.), International Financial Markets: Harmonisation versus Competition (Washington, D.C.: AEI Press 1996) pp. 5–48, at 28 et seq., specifying however that “the dangers of internationally harmonised government failure should lead to caution in endorsing a harmonisation approach”.
10. International Financial Markets: Harmonisation versus Competition, p. 29.
11. See White, International Financial Markets: Harmonisation versus Competition n. 7, at 29.
12. R. Romano, “Empowering Investors: A Market Approach to Securities Regulation”, 107 Yale Law J. (1998) 2359, at 2365.
13. Yale Law J., at 2366.
14. Yale Law J.
15. See Giovanoli, Yale Law J. n. 2, pp. 3 et seq.
16. R. Romano, “The Need for Competition in International Securities Regulation”, Yale ICF Working Paper No. 00–49 (2001), p. 3.
17. See P. Stephan, “Regulatory Cooperation and Competition: The Search for Virtue”, University of Virginia School of Law, Legal Studies Working Paper Series, WP No. 99–12 (June 1999).
18. Romano, University of Virginia School of Law, Legal Studies Working Paper Series n. 14. p. 4.
19. See G. Majone, Regulating Europe (London/New York: Routledge 1996) pp. 284 et seq.
20. See the Report of the IASC's Strategy Working Party, “Recommendations on Shaping IASC for the Future” (November 1999).
21. See International Accounting Standards Board, “Exposure draft of a proposed Preface to International Financial Reporting Standards” (November 2001) p. 11.
22. “Exposure draft of a proposed Preface to International Financial Reporting Standards”, at 11 and 12.
23. See R.A. Dye and S. Sunder, “Why not Allow the FASB and IASB Standards to Compete in the US?”, Yale School of Management, Working Paper Series AC, Working Paper 02 (May 2001).
24. Network externalities are the benefits of having multiple customers adhere to the same standard. See Dye and Sunder, Yale School of Management, Working Paper Series AC, Working Paper n. 21, at F12: “If multiple firms adhere to the same set of standards, readers can compare across firms and interpret the reports better”.
25. Dye and Sunder, Yale School of Management, Working Paper Series AC, Working Paper n. 21, attribute the world leadership in accounting to FASB. In addition they argue that IASB's standards could be diluted to gain international acceptance and IASB could be deadlocked or captured by interests hostile to business.
26. See, however, n. 19 Yale School of Management, Working Paper Series AC, Working Paper and the accompanying text.
27. See R.M. Buxbaum and K.J. Hopt, Legal Harmonization and the Business Enterprise. Corporate and Capital Market Law Harmonization Policy in Europe and the U.S.A. (Berlin/New York: de Gruyter 1988) pp. 232 et seq., 262 et seq.
28. See the Final Report of the Committee of Wise Men on the Regulation of European Securities Markets (Brussels, 15 February 2001), including the Committee's Initial Report, published on 9 November 2000, as Annex 5, p. 14.
29. Final Report of the Committee of Wise Men on the Regulation of European Securities Markets, p. 15.
30. OJL [1999] 184/23.
31. K. Lenaerts and A. Verhoeven, “Towards a Legal Framework for Executive Rule-Making in the EU? The contribution of the new comitology decision”, 37 C.M.L. Rev. (2000) 645.
32. Lenaerts and Verhoeven, C.M.L. Rev. n. 28, at 646.
33. See the Final Report, C.M.L. Rev. n. 25, p. 22.
34. C.M.L. Rev., p. 28.
35. See Final Report, C.M.L. Rev. n. 25, pp. 29 et seq.
36. C.M.L. Rev.
37. C.M.L. Rev., p. 28.
38. C.M.L. Rev., p. 24.
39. See Lenaerts and Verhoeven, C.M.L. Rev. n. 28, at 651.
40. C.M.L. Rev., with reference to Case 25/70
41. Köster, [1970] ECR 1161, para 6.
42. See Final Report, ECR n.25, p. 37.
43. See Majone, ECR n. 17, p. 273 et seq.
44. A. La Spina and G. Majone, Lo Stato Regolatore (Bologna: II mulino 2000) p. 267
45. E. Chiti, “The Emergence of a Community Administration: the Case of European Agencies”, 37 C.M.LRev. (2000) 309.
46. Final Report, C.M.LRev. n. 25, p. 40.
47. C.M.LRev., p. 21.
48. As recently done for the proposed prospectus directive, infra s. 4.2.7.
49. infra, p. 37.
50. The question of a European SEC was already considered by Buxbaum and Hopt, infra n. 24, who offered a negative answer on political grounds.
51. See also R. Lee, “Supervising EU Capital Markets: Do We Need a European SEC?”, in: R.M. Buxbaum, G. Hertig, A. Hirsch, K.J. Hopt, European Economic and Business Law (Berlin/New York: de Gruyter 1996) p. 187, arguing that the European Commission should develop into a body similar, in some important respects, to the SEC.
52. See Final Report, European Economic and Business Law n. 25, p. 41.
53. See Case 9/56 Meroni, [1957–1958] ECR 133
54. Case 10/56 Meroni, [1957–1958] ECR 157.
55. See La Spina and Majone, ECR n. 40, p. 267
56. D. O'Keeffe and N. Carey, “Financial Services and the Internal Market”, in: Ferrarini, Hopt and Wymeersch (eds.), Capital Markets in the Age of the Euro. Cross-border Transactions, Listed Companies and Regulation (London/The Hague/Boston: Kluwer Law International 2002) 15.
57. The following comments draw on G. Ferrarini, “The European Regulation of Stock Exchanges: New Perspectives”, 36 C.M.L.Rev. (1999) 569–598.
58. For a commentary, see C. Biancheri, “Cooperation Among Supervisory Authorities Under the ISD”, in: G. Ferrarini (ed.), European Securities Markets. The Investment Services Directive and Beyond (London/The Hague/Boston:Kluwer Law International 1998) pp. 369 et seq.
59. The transparency of a market depends, to a considerable extent, on its microstructure. In terms of pre-trade transparency, auction markets are “‘inherently’ more transparent than dealer markets; post-trade transparency tends to be lower in dealer markets as a result of ‘inherent technical factors and deliberate choices by exchange authorities”: M. Pagano and A. Roell, “Transparency and Liquidity: a Comparison of Auction and Deaker Markets with Informed Trading”, 51 J. Fin. (1996) 580.
60. As argued by the UK Securities and Investment Board with respect to the dealer market operated by the London Stock Exchange: “in such a market too stringent a regime of post-trade transparency can adversely affect liquidity and thus the efficiency of the equity market, particularly with respect to institutional dealing in large size… ” (SIB, Regulation of the United Kingdom Equity Markets, Discussion Paper (Feb. 1994) p. 11).
61. In the end, Article 21 very much incorporated the views of the UK and Germany: see A. Roell, “Competition among European exchanges: recent developments”, in: Ferrarini (ed.), European Securities Markets, Discussion Paper n. 51, pp. 213–224, at p. 216.
62. B. Steil, “Equity trading IV: the ISD and the regulation of European market structure”, in: B. Steil (ed.), The European Equity Markets. The State of the Union and An Agenda For the Millennium (London: ECMI and the Royal Institute of International Affairs 1996) pp. 113 et seq., at p. 127.
63. See M. Pagano, “The Changing Microstructure of European Equity Markets”, in: G. Ferrarini (ed.), European Securities Markets, The European Equity Markets. The State of the Union and An Agenda For the Millennium n. 51, pp. 177–204, at pp. 191 et seq.
64. See, for the origin of such provisions in France, M. De Juglart and B. Ippolito, Traite de Droit Commercial, vol. 7: Banques et Bourses, 3rd ed. by L.M. Martin (Paris: Montchrestien 1991) pp. 663 et seq.; for Belgium, Art. 23 of Law 4 Dec. 1990 concerning financial transactions and financial markets; for Italy, Art. 11 of Law 2 Jan. 1991, No. 1. (“SIM Law”).
65. See, for the UK, R. Pennington, The Law of the Investment Markets (Oxford: Blackwell Law 1990) p. 24
66. for Germany, von Rosen, “Die rechtliche Ordnung des geregelten Kapitalmarkts”, in: Assman and Schütze (eds.), Handbuch des Kapitalanlagerechts, 2nd ed. (Munchen: Beck 1996) p. 57.
67. This assumption is open to criticism, given today's existence of alternative venues for trading securities efficiently: J. Macey and M. O'Hara, “The Law and Economics of Best Execution”, 6 J. Fin. Intermediation (1997) 188–223.
68. See C. Bronfman, K. Lehn and R. Schwartz, “US Securities Markets Regulation: Regulatory Structure”, in: B. Steil (ed.), International Financial Market Regulation (Chichester/New York: Wiley 1994) p. 56.
69. In Ferrarini, International Financial Market Regulation n. 50, at 584 et seq., I have argued that introduction of a per se prohibition is questionable on the ground that the concentration of exchange transactions may increase market liquidity and efficiency.
70. In particular, the concentration rules aim to solve the ‘free-riding problem’ which arises whenever the exchange members exploit the information received from the exchange by transacting on competing exchanges or off-board: see J.H. Mulherin, J.M. Netter and J.A. Overdahl, “Prices are Property: the Organization of Financial Exchanges from a Transactions Costs Perspective”, 34 J. Law & Econ. (1991) 591. Concentration rules are similar to exclusive dealing clauses which are agreed upon by producers and distributors to limit their clients' free-riding. If Article 14 (3) had not been adopted, concentration would be dealt with under the antitrust rules of the EC Treaty in terms similar to those applicable to exclusive dealing.
71. For an illustration of this argument, J. Law & Econ., at 588 et seq.
72. Steil, J. Law & Econ. n. 56, p. 129.
73. K.J. Hopt, “Zum Begriff des geregelten Marktes nach der Wertpapierdienstleistungs-richtlinie - am Beispiel von Eurex”, in: Horn, Lwowski and Nobbe (eds.), Bankrecht -Schwerpunkte und Perspektiven. Festchrift für Herbert Schimansky (Köln: RWS 1999) pp. 631–652, at p. 638.
74. See Ferrarini, J. Law & Econ. n. 50, at 582 et seq.
75. See K.J. Hopt and H. Baum, “Börsenrechtsreform in Deutschland”, in: K.J. Hopt, B. Rudolph and H. Baum (eds.), Börsenreform. Eine ökonomische, rechtsvergleichende und rechtspolitische Untersuchung (Stuttgart: Schaeffer-Poeschel 1997) pp. 361 et seq.
76. See the Commission Communication, Börsenreform. Eine ökonomische, rechtsvergleichende und rechtspolitische Untersuchung (Stuttgart: Schaeffer-Poeschel n. 64.
77. Börsenreform. Eine ökonomische, rechtsvergleichende und rechtspolitische Untersuchung (Stuttgart: Schaeffer-Poeschel, p. 13. This assumption does not exclude the popular view that the regulated markets' single passport is already practically in force under Article 15 (4) ISD: see para. 2.1 above.
78. Börsenreform. Eine ökonomische, rechtsvergleichende und rechtspolitische Untersuchung, p. 15.
79. Börsenreform. Eine ökonomische, rechtsvergleichende und rechtspolitische Untersuchung.
80. See Revision of the Investment Services Directive, Börsenreform. Eine ökonomische, rechtsvergleichende und rechtspolitische Untersuchung n. 69, Annex 2: Summary of Responses to the Preliminary Orientations of Commission Services, p. 25.
81. See A. Whittaker, ‘A European Law for Regulated Markets? Some Personal Views’, in: Ferrarini (ed.), Börsenreform. Eine ökonomische, rechtsvergleichende und rechtspolitische Untersuchung n. 51, p. 272 et seq., arguing that gaps in the coverage of the ISD do not necessarily mean that a new directive at the European level is needed.
82. See Ferrarini, Börsenreform. Eine ökonomische, rechtsvergleichende und rechtspolitische Untersuchung n. 50, p. 575.
83. See Revision of Investment Services Directive, Börsenreform. Eine ökonomische, rechtsvergleichende und rechtspolitische Untersuchung (Stuttgart: Schaeffer-Poeschel n. 69, Overview Paper, p. 2.
84. Börsenreform. Eine ökonomische, rechtsvergleichende und rechtspolitische Untersuchung, p. 3.
85. Börsenreform. Eine ökonomische, rechtsvergleichende und rechtspolitische Untersuchung, p. 9.
86. Börsenreform. Eine ökonomische, rechtsvergleichende und rechtspolitische Untersuchung.
87. This issue was extensively debated in the US: see J. Macey and M. O'Hara, “Regulating Exchanges and Alternative Trading Systems: a Law and Economics Perspective”, 28 J. Leg. St. (1999) 17.
88. See Overview Paper, J. Leg. St. n. 78, p. 10 citing, at note 5, Euromoney, Nov. 2001, p. 78: “Banks that have taken the lead are already capable of internalising about a third of their transaction volumes”.
89. J. Leg. St., p. 5, arguing that “high volume bilateral systems” are capable of contributing to market fragmentation “thereby reducing overall interaction in a market”.
90. See Revision of the Investment Services Directive, J. Leg. St. n. 69, Annex I: Revised Orientations, p. 22.
91. See Overview Paper, J. Leg. St. n. 78, p. 10.
92. See Overview Paper, J. Leg. St. n. 78, p. 11.
93. See The Regulation of Alternative Trading Systems in Europe, J. Leg. St. n. 84 above, p. 12, where FESCO states that by fragmenting the markets and lowering transparency ‘ATS might make it more difficult and costly for intermediaries to achieve best execution on investors’ behalf.
94. See Annex I: Revised Orientations, J. Leg. St. n. 86, p. 23.
95. J. Leg. St., p. 17.
96. See Overview Paper, J. Leg. St. n. 78, p. 13, stating that in a similar case “the firm must assume all obligations to clients that apply to a broker providing comparable service”.
97. J. Leg. St., p. 9, where it is also stated (at note 2) that the value of other instruments often can be established on the basis of fixed reference values, or the value of an underlying (including equity).
98. See Overview Paper, J. Leg. St. n. 78, p. 14.
99. J. Leg. St., p. 15.
100. J. Leg. St.
101. J. Leg. St., p. 3.
102. J. Leg. St., p. 16.
103. M. Pagano and A. Roell, “Transparency and Liquidity: A Comparison of Auction and Dealer Markets with Informed Trading”, 51 J. Fin. (1996) 580.
104. J. Leg. St.
105. See Annex I: Revised Orientations, J. Leg. St. n. 86, p. 36.
106. J. Leg. St.
107. Pagano and Röell, J. Leg. St. n. 99, 580.
108. See Ferrarini, J. Leg. St. n. 50, 582 et seq.
109. See Bronfman, Lehn and Schwartz, J. Leg. St. n. 61, at 58.
110. See Mulherin, Netter and Overdahl, J. Leg. St. n. 62.
111. On the difficulty to predict whether market consolidation or fragmentation will prevail, see B. Biais, “Euroepan Stock Markets and European Unification”, in: J. Dermine and P. Hillion (eds.), European Capital Markets with a Single Currency (Oxford: OUP 1989) pp. 252 et seq.
112. See European Capital Markets with a Single Currency n. 61.
113. See Overview Paper, European Capital Markets with a Single Currency n. 78, p. 26.
114. See Annex I: Revised Orientations, European Capital Markets with a Single Currency n. 86, p. 32.
115. European Capital Markets with a Single Currency, p. 33.
116. Directive No. 79/279/EC of 5 March 1979, OJ [1979] L 66.
117. Directive 01/34/EC of 28 May 2001, OJ [2001] L 184.
118. See Overview Paper, OJ n. 78, p. 27.
119. Ferrarini, OJ n. 50, at 572 et seq.
120. See Annex I: Revised Orientations, OJ n. 86, p. 34.
121. See Overview Paper, OJ n. 78, p. 13, where it is said that the revised orientations “[r]ecognise that client orders may be executed outside the rules and systems of exchanges under a range of formats (incidental client internalisation, systematic order-internalisation, ATS)”.
122. See OJ n. 61 and 62, and accompanying text.
123. See also for other references, C. Di Noia, “Customer-controlled Firms: the Case of Financial Exchanges”, in: Ferrarini, Hopt and Wymeersch, OJ n. 49, pp. 173–191.
124. See Annex I: Revised Orientations, OJ n. 86, pp. 30 et seq.
125. See Overview Paper, OJ n. 78, p. 26.
126. For information, see G. Ferrarini, “Stock Exchange Governance in the European Union”, in: M. Balling, O'Brien and Hennessy (eds.), Corporate Governance, Financial Markets and Global Convergence (Dordrecht: Kluwer 1998) p. 139.
127. See Annex I: Revised Orientations, Corporate Governance, Financial Markets and Global Convergence n. 86, p. 36.
128. See Revision of the Investment Services Directive, Corporate Governance, Financial Markets and Global Convergence n. 75, Annex II: Summary of Responses to the Preliminary Orientations of Commission Services (July 2001), p. 27.
129. On the costs and benefits of accounting standards' harmonisation, Corporate Governance, Financial Markets and Global Convergence n. 21 and accompanying text.
130. These are Council Directive 80/390/EEC of 17 March 1980, co-ordinating the requirements for the listing particulars to be published for the admission of securities to official stock exchange listing, OJ [1980] L 100
131. Council Directive 89/298 of 17 April 1989, co-ordinating the requirements for the prospectus to be published when transferable securities are offered to the public, OJ [1989] L124.
132. On these efforts, see A. Licht, “International Diversity in Securities Regulation: Roadblocks on the Way to Convergence”, 20 Cardozo L. Rev. (1998) 227, cautioning against insufficient analysis of the corporate governance implications of harmonisation projects concerning international securities regulation
133. id., “Games Commissions Play: 2X2 Games of International Securities Regulation”, 24 Yale J. Int'l L. (1999) 61, using game theory and international relations theory to explain co-operation in several areas, including that of accounting standards.
134. See Commission Communication, Yale J. Int'l L. n. 127, p. 7.
135. Yale J. Int'l L., further specifying that ‘the central task of this mechanism should be to confirm that IAS are in full conformity with the Union's overall approach - more specifically, if there is conformity with the EU's Accounting Directives and that a suitable basis for financial reporting by listed EU companies is provided’.
136. Yale J. Int'l L., p. 8. Reference should be made to the Council Decision of 28 June 1999 which governs “comitology”.
137. See the Explanatory Memorandum, p. 5, and the 8th considerandum of the Draft Regulation, note 132.
138. See DG Internal Market, Commission proposes requirement for listed companies to use International Accounting Standards by 2005 (13 February 2001).
139. See DG Internal Market, Commission welcomes creation of European Technical Expert Group (26 June 2001).
140. Commission welcomes creation of European Technical Expert Group n. 137, p. 9.
141. The Accounting Directives will be amended to maintain consistency between the EU financial reporting framework and IAS, as illustrated by directive 01/65/EC of 27 September 2001 introducing principles of “fair value accounting” in the annual and consolidated accounts of certain types of companies (OJ [2001] L283).
142. This directive refers to various forms of derivative financial instruments such as futures, options, forward contracts and swaps, and to the solutions adopted by the most influential accounting standards setters to ensure that the financial impacts of these instruments are reflected in company financial statements appropriately (OJ, p. 3).
143. These solutions, including those adopted by IASC (see IAS 39 (1998), para. 66 et seq.), move away from the historical cost valuation model, on which the Accounting Directives are based, towards a “valuation at fair value” model, which most often refers to valuation according to the markets (See the Explanatory Memorandum introducing the proposal for a directive amending Directives 78/660/EEC and 83/349/EEC as regards the valuation rules for the annual and consolidated accounts of certain types of companies, 24.02.2000 COM (2000) 80 final, 2000/0043 (COD), p. 3).
144. The purpose of the directive is ‘to modernise the Accounting Directives in line with business developments and associated developments in international accounting standard setting so that they remain in line with the capital market financial reporting requirements of internationally active European companies. It will therefore enable European companies to participate in the capital markets on equal terms with their non-European competitors’ (COD., p. 4).
145. See Towards an EU Regime etc., COD n. 140, p. 8, where the need to consolidate is referred to the relevant provisions of Directive 79/279/EEC on the conditions for admission of securities to official stock exchange listing, Directive 82/121 /EEC on regular reporting and Directive 88/62/EEC on major shareholdings in a listed company. This document, however, specifies that “consolidation alone is insufficient”.
146. COD, p. 9 et seq. The practice of publishing half-yearly reports is deemed insufficient; therefore, “the services of DG Internal Market favour a condensed set of consolidated financial statements for each quarterly period”, the content of which should follow international accounting standards.
147. COD, p. 11 et seq.
148. COD, p. 12.
149. COD, p. 13: “Ideally there should be a system of hyperlinks between the competent authorities of the Member States…”
150. See, however, E. Wymeersch, “The Use of ICT in Company Law”, in: Ferrarini, Hopt and Wymeersch, COD n. 49, pp. 474 et seq., advocating a system of disclosure by issuers on individual websites, under the supervision of national regulators. Access to these websites on a European basis could be facilitated by either the stock exchanges or the supervisors or other bodies involved in the market organisation (at p. 480).
151. Towards an EU Regime etc., COD n. 140.
152. For a reference to these Directives, see COD n. 126.
153. H.E. Jackson and E.J. Pan, “Regulatory Competition in International Securities Markets: Evidence from Europe in 1999 - Part I” 56 Bus. Law (2001) 653, at 681.
154. Bus. Law. The authors comment, however, that the quality of disclosure documents accompanying “international style offerings” and the due diligence work underlying this documentation are of much higher quality than the formal disclosure requirements on most European countries (at 685).
155. Bus. Law., 688: “Under U.S. law, if an institutional investor purchases a security in a private placement, the security may generally not be resold to retail investors for one to two years”.
156. Bus. Law., 690.
157. FESCO, A ‘European Passport’ for Issuers, A Report for the EU Commission, 20 December 2000, p. 4.
158. A Report for the EU Commission, p. 3. The essence of FESCO members' agreement is to ground the mutual recognition of prospectuses on a mechanism of “simple notification”. Once the documents constituting a prospectus have been approved by the home country authority (i.e. the competent authority of the country where the issuer has its registered office or its primary listing), the prospectus is automatically recognised upon notification to the host country authorities where the offer or listing takes place.
159. Therefore, an issuer may offer or list its shares in another EEA State simply by complying with this notification procedure (A Report for the EU Commission, p. 4).
160. A Report for the EU Commission, p. 7.
161. See Explanatory Memorandum, p. 2, where the following comment: “Unless reform is undertaken, inconsistencies will continue. The European financial market will remain fragmented. And cross border capital raising will remain the exception, rather than the rule - the antithesis of the logic of the single currency”.
162. Explanatory Memorandum, p. 3.
163. Explanatory Memorandum s. 2.2.
164. H.S. Scott, “Internationalization of Primary Public Securities Markets”, 63 Duke Journal of Law and Contemporary Problems (2000) 71, at 78.
165. H.S. Scott, “Internationalisation of Primary Public Securities Markets Revisited”, in: Ferrarini, Hopt and Wymeersch (eds.), Duke Journal of Law and Contemporary Problems n. 49, p. 306.
166. See Duke Journal of Law and Contemporary Problems n. 18–20 and accompanying text.
167. Scott, Duke Journal of Law and Contemporary Problems n. 163, at 79.
168. Duke Journal of Law and Contemporary Problems.
169. See the study by FESCO, Stabilisation and Allotment - A European Supervisory Approach, June 2001.
170. See the comparative study by K.J. Hopt, Die Verantwortlichkeit der Banken bei Emissionen (Munich: Beck 1991); for recent developments in the UK
171. see E.Z. Lomnicka and J.L. Powell, Encyclopedia of Financial Services Law, para. 4–512
172. for Germany see A. Baumbach, K. Duden and K.J. Hopt, Handelsgesetzbuch, 30th ed. (München: Beck 2000) pp. 1557 et seq.
173. See G. Wegen and C. Lindemann, “The Law Applicable to Public Offerings in Continental Europe”, in: H. van Houtte (ed.), The Law of Cross-border Securities Transactions (London: Sweet & Maxwell 1999) pp. 162 et seq.
174. See Article 5 of the proposed prospectus directive and Explanatory Memorandum introducing it, at p. 5(The Law of Cross-border Securities Transactions n. 155).
175. See Explanatory Memorandum, p. 5
176. Article 9 of the proposed directive (Explanatory Memorandum n. 155).
177. See Explanatory Memorandum, p. 5.
178. See Moloney, Explanatory Memorandum n. 3, para. 4.9.3.6.
179. See the Report by the European Parliament, Explanatory Memorandum n. 158, at p. 23, where the comment: “The latter format may not be appropriate for certain smaller issuers who do not plan to go repeatedly back to the markets”.
180. See the Explanatory Memorandum, Explanatory Memorandum n. 155, p. 3.
181. Explanatory Memorandum, p. 4 and Article 15 of the proposed directive.
182. See Article 16 and the Explanatory Memorandum, Explanatory Memorandum n.155, p. 4.
183. Explanatory Memorandum n. 174, para. 3.
184. Explanatory Memorandum, para. 3.3.
185. For further information about the examples made, see Ferrarini, “European Securities Regulation and the Rise of Pan-European Securities Markets: An Overview”, in: Ferrarini, Hopt and Wymeersch (eds.), Explanatory Memorandum n. 49, 241, pp. 242 et seq.
186. See Comments by the London Stock Exchange, Explanatory Memorandum n. 171, para 3.2.
187. See A. Licht, “Stock Exchange Mobility, Unilateral Recognition, and the Privatisation of Securities Regulation” 41 Va. J. Int. L. (2001) 583.
188. Va. J. Int. L. n. 155, p. 13: “The Directive needs to clarify that the prospectus requirement cannot be triggered when securities are the subject of a procedure for admission to trading without the consent of the issuer”.
189. See A. Licht, Va. J. Int. L. n. 186.
190. For an analysis of these problems, from the Italian perspective, see G. Ferrarini, “Ammissione alia quotazione e ammissione alle negoziazioni”, Banca borsa e titoli di credito (2002) (forthcoming).
191. Explanatory Memorandum, Banca borsa e titoli di credito n. 155, p. 4.
192. Banca borsa e titoli di credito.
193. See Banca borsa e titoli di credito s. 4.1.2.
194. On the benefits of regulatory decentralisation, see P.G. Mahoney, “The Exchange as a Regulator” 83 Va. L. Rev. (1997) 1453.
195. See Amendment 56 in the Report by the European Parliament, Va. L. Rev. n. 158, at 45, and the relevant “justification” referring to the fact that “in many Member States, market operators are today entrusted with functions and/or responsibilities in the context of prospectus scrutiny and approval”.
196. See M.B. Fox, “Securities Disclosure in a Globalizing Market: Who Should Regulate Whom”, 95 Mich. L. Rev. (1997) 2498
197. Id., “Retaining Mandatory Securities Disclosure: Why Issuer Choice is not Investor Empowerment”, 85 Va. L. Rev. (1999) 1244.
198. The second study includes a criticism of the issuer choice model proposed by Romano, Va. L. Rev. n. 10
199. S.J. Choi and A.T. Guzman, “The Dangerous Extraterritoriality of American Securities Law”, 17 Nw. J. Int'l L. & Bus. (1996) 207, 228-e32
200. Id., “Portable Reciprocity: Rethinking the International Reach of Securities Regulation”, 71 S. Cal. L. Rev. (1998) 903.
201. For a response, see Romano, S. Cal. L. Rev. n. 14.
202. Fox, “Securities Disclosure in a Globalizing Market: Who Should Regulate Whom”, S. Cal. L. Rev., at 2504.
203. S. Cal. L. Rev., at 2580 et seq.
204. See the Explanatory Statement by C. Huhne, MPE, in the Report by the European Parliament, S. Cal. L. Rev. n. 158, 50–53, at 51.
205. See Comments from the London Stock Exchange etc., S. Cal. L. Rev. n. 174, para 4.
206. See the Explanatory Statement, S. Cal. L. Rev., at 51.
207. See the “justification” to amendment 16, in the Report by the European Parliament, S. Cal. L. Rev. n. 158, at 17.
208. See the European Parliament's Legislative Proposal, S. Cal. L. Rev. n. 158.
209. See S. Bergsträasser, “Regulatory Implications of an Exchange Merger”, in: Ferrarini, Hopt and Wymeersch, S. Cal. L. Rev. n. 49, pp. 289–296.