EU-US Financial Markets Regulatory Dialogue

24 May 2004

In a testimony to the Financial Services Committee of US House of Representatives held on May 13th, Mr Schaub, the European Commissions’ Internal Market Director-general referred to the interdependence between both the US and the EU market that has been achieved despite regulatory differences and barriers. He also underlined the need to cooperate upstream to prevent new conflicts, particularly with regard to the forthcoming new Basel Capital Accord and the introduction of International Accounting Standards in the EU from next year.

He also welcome the launch of a Dialogue between EU and US supervisors, particularly between the SEC and CESR, and between the NAIC and CEIOPS. Mr Schaub stated that although the regulatory systems have grown in isolation from each other “we have to recognise that the blind exercise of regulatory autonomy will penalise us both, and undermine global capital markets”.

“On the US side, Members of the Committee will be only too aware how the Sarbanes-Oxley Act has had far-reaching consequences on auditors and listed companies outside the US. Future cooperation has to star from scratch. “My sense and that of my Commissioner has been that if we spend our time in discussions about terms such as “reciprocity”, “national treatment” and “mutual recognition”, we will not get anywhere” Mr Schaub said.

Testimony

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