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Abstract
The global financial crisis challenged the existing architecture for financial services regulation and supervision in the European Union (EU). This article first examines the new pieces of legislation that were issued by the EU in the wake of the crisis, as well as substantial revisions of existing EU legislation. Second, it conducts an overall assessment of the reforms implemented and highlights some open issues that were underscored by the crisis and that were only partially addressed afterward. It is argued that the framework for financial regulation and supervision in the EU after the crisis is still poorly equipped to deal with (or to prevent) future financial crises mainly because of the political constraints encountered during the reform process. One of the most important lessons to be drawn is that political factors are as important as (if not more important than) economic factors in shaping financial services regulation and supervision in the EU (and, arguably, elsewhere).
Acknowledgements
The author wishes to acknowledge financial support from the European Research Council (204398 FINGOVEU) and the British Academy (SG 120191). This paper was written while the author was a visiting fellow at the Max Planck Institute, the European University Institute and Hanse Wissenschaftskolleg.
Notes
2. Sweden has a significant private equity industry, hence it was seen as having a vested interest in the revision of the text of the directive.
3. All these legislative texts can be found at: http://ec.europa.eu/internal_market/finances/committees/index_en.htm