Integration of the Securities Market Infrastructure in the European Union: Policy and Regulatory Issues
IMF Working Papers, October 1, 2006
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- Integration of the Securities Market Infrastructure in the European Union: Policy and Regulatory Issues
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Bibliographic details
- Authors: Elias G. Kazarian
- Published: October 1, 2006
- Series: IMF Working Papers
- DOI: https://doi.org/10.5089/9781451865011.001
Summary and key conclusions
- Examines the impact of ongoing cross-border integration of securities market infrastructure in the European Union.
- Analyzes the regulatory framework that has evolved to deal with the risks associated with cross-border clearing and settlement.
- Concludes that, due to institutionalized deficiencies, the current cross-border regulatory framework may not be adequate or effective in addressing and preventing a real cross-border crisis.
- Proposes a two-tier regulatory framework for securities infrastructure in Europe entailing the creation of a centralized "federal" European regulatory framework for regional systems, in addition to the current national regulatory framework for domestic systems.
Analysis of regulatory framework and risks
- Focus on risks associated with cross-border clearing and settlement.
- Identifies institutionalized deficiencies in the current cross-border regulatory framework that may impair crisis prevention and management.
- Emphasizes differences between regional systems and domestic systems in terms of regulatory needs and supervision.
Policy proposal and recommendations
- Two-tier regulatory framework:
- Create a centralized "federal" European regulatory framework for regional systems.
- Retain the current national regulatory framework for domestic systems.
- Implicit objective: strengthen cross-border crisis prevention and effectiveness of regulation for integrated securities infrastructure.