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13 June 2013

Finance Watch response to ECON coherence questionnaire

Finance Watch responded to the ECON consultation on ways to improve the coherence of EU financial services legislation. The consultation will help to establish legislative priorities for the remainder of this mandate and the new Parliament elected in 2014.

General Comment:

The questions in the first section of the questionnaire (questions 1 to 5) could be interpreted as being based on the assumption that regulation is always “bad” for the financial industry and that the main interest of financial industry lobby is to limit regulation as much as possible. 

As a general comment to this section, Finance Watch believes that more regulation and business efficiency are actually not always opposites. Recent research at New York University has shown that, specifically in financial services, the industry performs better in a regulated framework that provides fair competition, a level playing field, a stable economic environment and legal and regulatory certainty.

In addition, Finance Watch would argue that a fair regulatory environment without loopholes provides the right incentives for corporations that use their competitive advantages to invest in long-term sustainable economic activity rather than in temporary regulatory arbitrage.

Full response

© Finance Watch

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