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Article
Publication date: 1 April 1995

MAXIMILIAN J.B. HALL

During 1993 Member States of the European Union formally adopted two Directives—the Investment Services Directive and the Capital Adequacy Directive—concerned with the operation…

Abstract

During 1993 Member States of the European Union formally adopted two Directives—the Investment Services Directive and the Capital Adequacy Directive—concerned with the operation of investment business. This paper outlines the provisions contained in these Directives, which have to be enshrined in national law by the end of 1995 at the latest, explaining the role they play within the broader Single Market programme for financial services. A simple ‘cost‐benefit’ analysis of their likely impact, mainly on UK intermediaries, is also provided.

Details

Journal of Financial Regulation and Compliance, vol. 3 no. 4
Type: Research Article
ISSN: 1358-1988

Article
Publication date: 27 February 2007

Stéphane Janin

The aim of this paper is to analyze the impact of the Markets in Financial Instruments Directive (MiFID) on investment managers but also on funds' units as financial instruments.

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Abstract

Purpose

The aim of this paper is to analyze the impact of the Markets in Financial Instruments Directive (MiFID) on investment managers but also on funds' units as financial instruments.

Design/methodology/approach

Starting from the innovative legislative structure and scope of the MiFID, the paper assesses the way investment managers and funds'units are impacted, knowing that investment managers and funds'units are already largely tackled by another Directive, the UCITS Directive.

Findings

In spite of increasing many organizational and process requirements within investment management companies, the MiFID will probably not create dramatic changes in the daily functioning of those companies. However, the linkage between the provisions of the MiFID and the UCITS Directive has not been clearly made by European legislative institutions, which leaves uncertainties in the way the national legislators and regulators will transpose the MiFID in order to get the best consistence between this Directive and the UCITS one.

Research limitations/implications

Final assessment should be made once Member States have transposed the MiFID Directive and have enforced it in practice.

Originality/value

The value of the paper is to set a bridge between two different directives (the MiFID on the one hand, the UCITS Directive on the other hand) which both impact investment managers and funds' units.

Details

Journal of Financial Regulation and Compliance, vol. 15 no. 1
Type: Research Article
ISSN: 1358-1988

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Article
Publication date: 1 September 2003

Jonathan Herbst

The revision of the Investment Services Directive is one of the most significant proposals under the Financial Services Action Plan. Although not likely to be implemented until…

Abstract

The revision of the Investment Services Directive is one of the most significant proposals under the Financial Services Action Plan. Although not likely to be implemented until the end of 2006, it is hoped that many of the consequent changes to legislation and the FSA Rules will be in place before then, and it is, therefore, crucial to keep track of its progress through the Lamfalussy legislative process. This paper discusses the shape of the Commission’s final proposals, which were published in November, 2002, and how they will change the existing investment services regime in the UK.

Details

Journal of Financial Regulation and Compliance, vol. 11 no. 3
Type: Research Article
ISSN: 1358-1988

Keywords

Article
Publication date: 1 April 1997

Philip Woolfson

The Single Market in financial services (investment funds, banking, insurance and investment services) has had a long gestation and has been a mixed success. It is now faced with…

Abstract

The Single Market in financial services (investment funds, banking, insurance and investment services) has had a long gestation and has been a mixed success. It is now faced with a new challenge, the adaptation of the Community regulatory framework to an electronic environment. This paper reviews progress in creating a Single Market in financial services, in particular the application of freedoms to provide services and of establishment and the principles of mutual recognition, home country control and the single licence. It also identifies issues in relation to electronic advertising, marketing and provision of financial services on a cross‐border basis. The paper seeks to show that existing and proposed Community legislation provides a framework for future development of this new medium:

Details

Journal of Financial Regulation and Compliance, vol. 5 no. 4
Type: Research Article
ISSN: 1358-1988

Article
Publication date: 1 March 2000

Charles Abrams

After first being issued in draft in July 1998 and then taking a year to go through Parliament, the Financial Services and Markets Act 2000 (FISMA) finally became law on 14th…

Abstract

After first being issued in draft in July 1998 and then taking a year to go through Parliament, the Financial Services and Markets Act 2000 (FISMA) finally became law on 14th June, 2000. The Treasury, the government department responsible for the UK financial services industry, has, however, just announced that the FISMA will not come fully into force until summer 2001, although some sections may perhaps come into force earlier.

Details

Journal of Financial Regulation and Compliance, vol. 8 no. 3
Type: Research Article
ISSN: 1358-1988

Article
Publication date: 7 May 2020

Christopher Buttigieg, Joseph Agius and Sandra Saliba

This paper aims to examine the rationale for the establishment of a depositary passport as the next logical step in building an internal market for investment funds in the…

Abstract

Purpose

This paper aims to examine the rationale for the establishment of a depositary passport as the next logical step in building an internal market for investment funds in the European Union (EU). It makes the point that the de facto prohibition of depositary passporting poses risks to financial stability and has an adverse impact on investor protection in EU member states, which do not have a fully developed funds industry.

Design/methodology/approach

This paper analyses both the arguments in favour and against the adoption of a depositary passport. Moreover, it examines this proposal in the context of different approaches to fostering the internal market such as mutual recognition, harmonisation of regulation, reflexive governance of financial supervision and centralised supervision.

Findings

Based on the review of the current EU legal framework, this paper, subsequently, puts forward possible solutions for the establishment of an internal market for depositary business, which solutions have been discussed with various experts in the field to assess their feasibility in practice.

Originality/value

The paper contributes to the debate on the EU internal market in the field of asset management, which is topical in view of the upcoming review of the EU’s Alternative Investment Fund Managers Directive.

Details

Journal of Financial Regulation and Compliance, vol. 28 no. 4
Type: Research Article
ISSN: 1358-1988

Keywords

Book part
Publication date: 24 August 2021

Athanasios Panagopoulos

This chapter aims the research whether the application of European Directive, Markets in Financial Instruments Directive (MiFID), had any significant effects on the European…

Abstract

This chapter aims the research whether the application of European Directive, Markets in Financial Instruments Directive (MiFID), had any significant effects on the European Capital Markets and the progress of the European Integration. This new regulation specifies the tasks and responsibilities of the supervisory authorities of the Member State of origin and the host Member State, in order to enhance the certainty of effectiveness of cross-border transactions supervision and to reduce the risk of imposing unnecessary legal reforms from the host Member State on investment firms which perform cross-border transactions. It has been concluded, among others, that the aligning of the national regulatory approaches to a common European regulatory system is quite necessary. It is finally concluded that MiFID will contribute to reduce problems at country level as the previous experience of the Investment Services Directive, where the European investments and economies of Member States were based mainly on the level of ‘country’ and not of the ‘sector’. An effective capital entrepreneurship market is a strategically important element in the development of new and innovative businesses, encouraging entrepreneurship, increasing the productivity and maintaining high economic growth rates in Europe. Currently, European venture capital market is much less effective than that of the US market, for example. Therefore, in this area, should be specified the priorities that will lead to new initiatives.

Details

Entrepreneurship, Institutional Framework and Support Mechanisms in the EU
Type: Book
ISBN: 978-1-83909-982-3

Keywords

Article
Publication date: 1 January 2001

Alan Davis

The European Commission has published a revised proposal for a European Parliament and Council directive to harmonise member states' rules on consumer protection in relation to…

Abstract

The European Commission has published a revised proposal for a European Parliament and Council directive to harmonise member states' rules on consumer protection in relation to the distance marketing of financial services. Financial services had been specifically excluded from the scope of the Distance Selling Directive which came into force in the UK on 31st October, 2000. Included in the proposal is the right of a consumer to receive a comprehensive set of information about the financial services supplier and the contract before the contract has been concluded, and the right to withdraw from the contract without penalty during a period of 14 days after entering into the contract. Questions have arisen as to whether the proposal is an example of wholly unnecessary intervention at European level and whether it is introducing unnecessary red tape for the financial services industry. One of the most important problems with the proposal relates, however, to a fundamental disagreement between member states as to whether the directive should be a maximum harmonisation measure or simply minimum harmonisation. With the current protracted state of negotiations, it remains unclear as to whether this proposal will ever achieve political agreement.

Details

Journal of Financial Regulation and Compliance, vol. 9 no. 1
Type: Research Article
ISSN: 1358-1988

Article
Publication date: 4 January 2008

Themis D. Pantos

The paper seeks to examine whether or not wealth effects and changes in the systematic risk associated with the return structure of the Greek commercial chartered banks, investment

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Abstract

Purpose

The paper seeks to examine whether or not wealth effects and changes in the systematic risk associated with the return structure of the Greek commercial chartered banks, investment firms and insurance companies resulted from the passage of the European Union Banking Directives over the period 1988‐1997.

Design/methodology/approach

Using monthly stock returns from the DataStream database for the period January 1988 to December 1997, the separate effects of each of the EU Banking Directives on Greek commercial chartered banks, investment firms and insurance companies are tested. The “seemingly unrelated regression” methodology is utilized to test three portfolios consisting of an equally weighted banking, investment and insurance index made up of major Greek banks, investment firms and insurance companies respectively. The Greek Market Index serves as a proxy for the market portfolio. All the aforementioned indices were converted to returns using the log difference method.

Findings

Empirical results indicate that the systematic risk dramatically increased for Greek insurance and investment firms and moderately increased for Greek commercial chartered banks through the tabling of the Free Capital Movement Directive in the Greek Parliament. After controlling for systematic risk, the results suggest that the passage of the Free Capital Movement Directive did not create wealth effects for the shareholders of commercial chartered banks, investment firms and insurance companies. Conversely, the results demonstrate that the Second Banking, Investment Services and Capital Adequacy Directives produced no wealth effects for the investment firms and insurance companies, but not for commercial chartered banks' shareholders. The whole wealth effect on the Greek financial sector was neutral.

Originality/value

This article will be of value to academics, bankers, bank regulators, practitioners, and economic policy makers who are interested in the regulatory evolution of the EU banking industry.

Details

The Journal of Risk Finance, vol. 9 no. 1
Type: Research Article
ISSN: 1526-5943

Keywords

Article
Publication date: 1 September 2003

Angela Knight

The EU’s Financial Services Action Plan (FSAP) which seeks to harmonise financial servicesacross Europe has the potential to bring great benefits to the investment community …

Abstract

The EU’s Financial Services Action Plan (FSAP) which seeks to harmonise financial services across Europe has the potential to bring great benefits to the investment community ‐ particularly the UK which already has a wealth of expertise. But in order for it to succeed the rule makers need to recognise some basic principles ‐ principally that they should focus on what is necessary to achieve their goal, rather than what is merely desirable. This paper outlines these principles of successful regulation and looks specifically at some of the problems in the most controversial of the current proposals ‐ the Investment Services Directive (ISD).

Details

Journal of Financial Regulation and Compliance, vol. 11 no. 3
Type: Research Article
ISSN: 1358-1988

Keywords

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