Iglesias-Rodríguez2021_Article_ESMAAsAResidualLawmakerThePoli.pdf (941.69 kB)
ESMA as a residual lawmaker: the political economy and constitutionality of ESMA’s product intervention measures on complex financial products
Version 2 2023-06-12, 09:46
Version 1 2023-06-09, 23:19
journal contribution
posted on 2023-06-12, 09:46 authored by Pablo Iglesias-RodriguezPablo Iglesias-RodriguezThis article proposes that product intervention constitutes a form of residual lawmaking by ESMA that allows it to tackle aspects of investor protection not addressed by EU incomplete financial laws. Whilst product intervention may bring about certain advantages and may contribute to mitigating regulatory arbitrage problems, it constitutes a highly intrusive regulatory mechanism that raises important questions concerning: (a) ESMA’s rationale and motivations for its use; (b) its compliance with the EU constitutional framework; and (c) its adequacy for the regulation of complex financial products. This article addresses these questions through an analysis of the rationale and consequences of ESMA’s product intervention measures on binary options and contracts for differences of May 2018–July 2019, and of recent reforms of ESMA’s powers. It offers three main contributions to the existing literature. First, it contributes to the literature on administrative discretion and agencies’ rulemaking through an analysis of the political economy of ESMA’s deployment of product intervention powers and, also, of what this reveals about the relationships between ESMA and the EU Institutions, on the one side, and ESMA and National Competent Authorities, on the other. Second, it contributes to the literature on the constitutionality of EU agencies through an examination of the compliance of ESMA’s product intervention measures with EU constitutional law and requirements. Third, it examines whether product intervention constitutes an adequate mechanism to address problems pertaining to investor protection in complex financial products markets and, in doing so, it contributes to the scholarly discussion on complex financial products’ regulation.
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- Published
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European Business Organization Law ReviewISSN
1566-7529Publisher
SpringerExternal DOI
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- Law Publications
Full text available
- Yes
Peer reviewed?
- Yes
Legacy Posted Date
2021-03-15First Open Access (FOA) Date
2021-08-12First Compliant Deposit (FCD) Date
2021-03-15Usage metrics
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