The regulation of cross-border clearing and settlement in the European Union from a legitimacy perspective

Iglesias-Rodriguez, Pablo (2012) The regulation of cross-border clearing and settlement in the European Union from a legitimacy perspective. European Business Organization Law Review, 13 (3). pp. 441-474. ISSN 1566-7529

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Abstract

Post-trading activities such as clearing and settlement (C&S) constitute a central element in the integration of European financial markets. However, unlike other areas of financial services, C&S has received little legislative and regulatory attention and, as a result, important barriers to the cross-border provision of C&S services persist in the European Union. In order to remove some of these barriers, the financial industry created, under the auspices of the European Commission, the European Code of Conduct for Clearing and Settlement, a self-regulatory instrument aimed at achieving a smoother provision of cross-border C&S services. This paper uses the concepts of input/output legitimacy to analyse the Code’s representative nature and effectiveness. It shows that, first, the Code has not received input from all the relevant constituencies potentially affected by C&S, and second, that there are serious threats to future compliance with the Code related to the competitive pressures of European financial markets. The paper also identifies the proposals to regulate C&S facilities at EU level as well as the new European supervision authorities in the financial field as elements which may highly contribute to the input/output legitimacy of cross-border C&S rules in the EU.

Item Type: Article
Keywords: clearing and settlement code of conduct input legitimacy output legitimacy central counterparties central securities depositories European Market Infrastructure Regulation European Securities and Markets Authority
Schools and Departments: School of Law, Politics and Sociology > Law
Subjects: K Law
Depositing User: Pablo Iglesias-Rodriguez
Date Deposited: 06 Oct 2015 13:02
Last Modified: 06 Oct 2015 13:02
URI: http://sro.sussex.ac.uk/id/eprint/57028
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