The European Commission has published a speech given by Vladis Dombrovskis, European Commissioner for Financial Stability, Services and Capital Markets Union, on February 10, 2017. Amid general concerns about the state of both European and international financial regulation, Mr. Dombrovskis placed emphasis on cooperation among international financial communities in finding a holistic and common approach to financial regulation. Mr. Dombrovskis stressed, in particular, the importance of a common standard of financial conduct, suggesting that the creation of low‑level regulations in one country with little oversight could trigger a contagion affect across other countries, therefore bringing fundamentally inadequate regulatory framework across the globe.
On this latter point, Mr. Dombrovskis highlighted what he thought might be the impact of different financial epicenters (notably New York, Paris, London and Frankfurt) having widely divergent rules. In particular, Mr. Dombrovskis thought this would create far greater scope for varying financial institutions to engage in regulatory arbitrage and would in fact cause the same institutions further costs to comply with each jurisdiction’s different rules.
In concluding, Mr. Dombrovskis stressed that international cooperation in the area was vital and should at present underpin the ever-evolving relationship between the UK and the EU.
Find the speech here.
