Immediately after the United States, the EU Member States leaders 19 also launched an ambitious plan for the reform of financial supervision. Since then, the EU's internal regulatory framework will be completely overwritten, a new set of pan-European financial supervision system came into being. But given that the EU continues to be a sovereign nation, the composition of reality, a new pan-European financial supervision system and us financial reform still insufficient.
Two institutions helm
To avoid a repeat of the financial crisis, the EU's reform plan is designed to break the Member States in the field of financial supervision and co-ordination of existing patterns, the realization of the unity of the EU level, in order to comply with the financial supervision activities increasingly beyond borders need for early detection of risks and signs of the future, more effectively constrain transnational financial institutions.
Reform plan most core content is newly established two bodies, namely strengthening the macro-and micro-level of the financial regulation.
At the macro level, a key member of the Central Bank Governors of the European systemic risk Board will be responsible for monitoring the entire EU financial market potential systemic risks, timely warning and, if necessary, make recommendations, which pioneered the EU macro-financial supervision.
At the micro level, primarily by members of the corresponding regulatory authorities representatives three authority are in charge of EU banking, insurance and securities supervision, to ensure that Member States perform unified regulatory rules, and to strengthen the supervision of cross-border financial institutions.
Before the end of this year, the EU will be in the territory of all transnational financial institutions set up by their home countries and the relevant Member State supervisory authority composed of representatives of the joint supervisory body, and in the different Member States, regulatory authorities or the joint supervisory body internal disagreement, three authority will have the right to conduct conciliation and mediation cases can make binding decisions, thereby enjoy a beyond the powers of the Member States of the regulatory authorities.
In the EU leaders adopted a programme for reform, the European Commission plans to introduce legislation this fall, start the legislative process, the new pan-European financial supervision system is expected in 2010.
Compromise cannot disguise the fact that limiting behind
Despite this reform programme will give the EU financial regulation a profound change in the pattern, but critics believe that the European Union to strengthen financial supervision is still diligently El is not large enough, especially with the United States newly adopted financial reform programmes also exist a lot of limitations.
The European Central Bank Executive Board Member Lorenzo · Bobigny · Smaghi day in Italy to attend an academic activities, said that the EU will respect the financial regulation, behind the United States than us reform programme, the EU, the effectiveness of the new regulatory system does not have to worry about.
Smaghi believes that the new EU regulatory system for a big flaw is the future of the European systemic risk Board will only be able to provide suggestions, have no right to force the members to implement, this is not conducive to the spread of risks.
Under the Obama administration 17-financial regulatory reform programme, the United States Federal Reserve Board will play a "super regulator" role, set the macro and the micro financial supervision, and has the right to take measures to address the threat to the entire financial system risk accumulation.
However, in view of the EU essentially remains a Commonwealth of sovereign States, unlike the federal system of Member States of the United States, let me get through many of the financial supervision authority is not an easy job, this is from the United Kingdom and the European systemic risk Board Chairman should "haggle".
In accordance with the European Commission, the European systemic risk Board Chairman shall concurrently by the European Central Bank and the European Central Bank is the euro area Central Bank of 16 countries unified, which are outside the United Kingdom in the euro area. As a compromise, the Chair candidates ultimately replaced by the European Central Bank to expand the Committee, and the expansion of the Committee is made up of representatives from all EU Member States.
At the same time, at the micro financial supervision, under pressure from the opposition of the United Kingdom, EU leaders on the three powers of the authority to impose a limit, i.e. their any decision shall not prejudice the right of Member States to the Government's financial, where the authority may not force a Government-funded relief national financial institutions to avoid affecting other countries.
Pan-European regulatory trend
As strengthening EU financial supervision of the most active promoters of France President Sarkozy on the day after the end of the Summit press conference that the EU is zero-based, and the creation of a new regulatory system, which in a few months ago is inconceivable.
Last September, the outbreak of the financial crisis in the EU economy at the same time hard, but also for EU financial reform effort provides a golden opportunity.
In addition to the day of adoption of the reform plan, the EU over the past few months has promulgated a number of legislation or legislative proposals such as the standard & poor's credit rating agencies and hedge funds, for the first time into strict supervision, asking them to conduct business in the EU market must first be registered. In early may, the European Parliament also adopted the revised capital adequacy directive, the requirements for asset-backed securitization business for financial institutions to keep at least 5% of the securitized assets for increased financial institutions of prudent obligations to protect the interests of investors. In addition, the EU also is in the process of reforming the Enterprise Executive pay system, to improve the transparency of the financial derivatives market.
Sarkozy said that he believed was a compromise and leave a pity as the practice of development to make up for the Pan-European financial supervision authority shall constantly enriched.
Analysts believe that along with the degree of economic integration in Europe continues to deepen, the limits of national financial markets become increasingly blurred, strengthen pan-European financial supervision will be the trend of the times.
However, Smaghi warned that as the global financial market stabilized signs, people tend to be "healed forget pain" for financial reform momentum and urgency, this may be a repetition of the crisis for the future laid a curse.
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