Regulatory Competition in International Securities Markets: Evidence from Europe - Part II
Eric J. Pan
Yeshiva University - Benjamin N. Cardozo School of Law; U.S. Securities and Exchange Commission
Howell E. Jackson
Harvard Law School
December 2, 2008
Cardozo Legal Studies Research Paper No. 247
Virginia Law & Business Review, Vol. 3, No. 2, p. 207, 2008
This article presents the second installment of an empirical investigation into regulatory competition in international securities markets. It contributes to the current debate about competitiveness of U.S. capital markets by offering an account of transatlantic capital raising practices at the height of technology boom of the 1990s and before the passage of the Sarbanes-Oxley Act of 2002 and the corporate scandals that precipitated the Act. This article provides evidence that European issuers in the late 1990s were already turning away from U.S. public capital markets. While regulatory considerations appear to have played a role in that trend, even more important were the growing importance of private means of access of U.S. capital, the increased off-shore presence of U.S. institutional investors, and the relatively unsatisfactory trading performance of many foreign issuers that had gone to the trouble of obtaining U.S. public listings early in the 1990s. The picture of transatlantic capital raising presented in our survey suggests that the recent decline in competitiveness of U.S. capital markets may well be more a product of long-standing trends in global financial markets than a response to the Sarbanes-Oxley Act or other requirements of federal securities laws. We have supplemented our original analysis with a post-script from the vantage point of 2008 to draw connections between our findings and those of recent academic literature.
Number of Pages in PDF File: 68
Keywords: securities regulation, international finance, securities offerings, cross-border listing, Rule 144A, American Depositary Receipts, capital markets competitivenessAccepted Paper Series
Date posted: December 2, 2008 ; Last revised: December 8, 2008
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