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Regulation of Global Financial Firms after Morrison v. National Australia Bank

24 Pages Posted: 1 Mar 2013 Last revised: 5 Mar 2013

Arthur B. Laby

Rutgers Law School

Date Written: March 3, 2013


In 2010, the U.S. Supreme Court decided Morrison v. National Australia Bank Ltd., which rewrote the law of extraterritoriality, shattering decades of precedent. After Morrison was decided, Congress, the U.S. Securities and Exchange Commission, and commentators have focused on the case's enforcement implications. This Article is different. This Article focuses not on enforcement but rather on the regulatory implications of the decision, arguing that Morrison calls into question the SEC’s ability to regulate and require registration of non-U.S. domiciled firms. By asserting a strong presumption against extraterritorial application of the securities laws and invalidating the conduct and effects test, the Court overturned doctrines the SEC has relied on for many years when regulating non-U.S. domiciled broker-dealers and investment advisers. These regulatory implications are of paramount importance to the SEC’s regulatory program and to investor protection, but they have gone largely unnoticed in Morrison’s aftermath. The goal of this symposium contribution is to identify the regulatory implications and the challenges they pose.

Keywords: securities regulation, broker-dealers, investment advisers, extraterritoriality, Securities and Exchange Commission

JEL Classification: K22, K23

Suggested Citation

Laby, Arthur B., Regulation of Global Financial Firms after Morrison v. National Australia Bank (March 3, 2013). St. John's Law Review, Vol. 87, No. 2, 2013. Available at SSRN:

Arthur B. Laby (Contact Author)

Rutgers Law School ( email )

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