Book contents
- Frontmatter
- Contents
- Tables
- Preface
- Tables of legislation
- Table of EU legislation
- Table of international conventions
- Table of cases
- Abbreviations
- Introduction
- PART I Introduction to electronic finance and Internet banking
- PART II Online banking and international market access: The causes of incomplete financial integration and what to do about them
- 3 Legal barriers and necessary regulatory reforms
- 4 The governance of the European market in cross-border electronic banking activities
- PART III EU harmonization and convergence of national laws relating to electronic banking activities
- PART IV Applicable law and allocation of regulatory responsibility in cross-border electronic banking activities
- Conclusions
- Select bibliography
- Index
4 - The governance of the European market in cross-border electronic banking activities
Published online by Cambridge University Press: 11 August 2009
- Frontmatter
- Contents
- Tables
- Preface
- Tables of legislation
- Table of EU legislation
- Table of international conventions
- Table of cases
- Abbreviations
- Introduction
- PART I Introduction to electronic finance and Internet banking
- PART II Online banking and international market access: The causes of incomplete financial integration and what to do about them
- 3 Legal barriers and necessary regulatory reforms
- 4 The governance of the European market in cross-border electronic banking activities
- PART III EU harmonization and convergence of national laws relating to electronic banking activities
- PART IV Applicable law and allocation of regulatory responsibility in cross-border electronic banking activities
- Conclusions
- Select bibliography
- Index
Summary
Introduction
In the previous chapter I argued that banks providing online services across borders are exposed to unacceptable risks of legal uncertainty and overregulation because the institutional model of ‘mutual recognition’ and ‘home country’ control in its imperfect current form has not quite eradicated the residual regulatory and enforcement role of the administrative and judicial authorities of the ‘host country’. I also argued that the benefits generated by cross-border electronic commerce in financial services justify bold institutional reforms with the overarching objective to achieve legal certainty, less but more efficient regulation and regulatory competition. In this chapter, I examine the benefits and disadvantages of several competing models of financial market integration in Europe and note my strong preference for a model of perfect mutual recognition and ‘managed’ regulatory competition based on sufficient harmonization of prudential and consumer protection standards and enforcement practices across Europe.
The most common liberalization policies and institutional reforms towards the integration of financial markets are de-regulatory and, often, re-regulatory in character. They are de-regulatory, because the reforms entail the elimination of legal and institutional barriers to trade in financial services and movements of capital. Existing ‘de-regulating’ mechanisms amount essentially to an allocation of regulatory responsibility among different countries, whatever the details of the various models. In other words, participating countries in areas of financial integration must decide whether the country of origin of financial activities may alone regulate, the recipient state may alone regulate, they may both regulate subject to limitations or a central supranational authority may alone regulate.
- Type
- Chapter
- Information
- Internet Banking and the Law in EuropeRegulation, Financial Integration and Electronic Commerce, pp. 82 - 134Publisher: Cambridge University PressPrint publication year: 2006