Preserving National Regulatory Autonomy in Financial Services: The GATS’ Prudential Carve-Out

69 Pages Posted: 2 Apr 2014

Date Written: December 31, 2013

Abstract

This note addresses the interplay of trade liberalization and financial services regulation — namely the key issue of the United States’ prudential regulation of financial services and its linkage to commitments made under the General Agreement on Trade in Services and free trade agreements. Focusing on the prudential carve-out exception present in the GATS, and nearly all of the United States’ liberalization commitments, this Note suggests that the prudential carve-out is over-inclusive and thus well insulates the US from challenges to its prudential framework. This Note also argues that the United States is further protected from challenges to its national regulatory autonomy due to the political economy surrounding the WTO and its limited judgment-enforcing powers.

Keywords: Trade in Financial Services, GATS, Banking & Financial Services Law

JEL Classification: K2

Suggested Citation

McAllister Shepro, Mary, Preserving National Regulatory Autonomy in Financial Services: The GATS’ Prudential Carve-Out (December 31, 2013). Available at SSRN: https://ssrn.com/abstract=2418764 or http://dx.doi.org/10.2139/ssrn.2418764

Mary McAllister Shepro (Contact Author)

Notre Dame University ( email )

Notre Dame Law School
Notre Dame, IN 46556
United States

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