The European Union's Role in International Economic Fora: The International Organisation of Securities Commissions (IOSCO)

Abstract

The International Organization of Securities Commissions (IOSCO) is the international standard setter for securities regulation. Because of its wide membership and consensus culture, which generally leads to a lack of granularity of its principles, the impact of IOSCO international principles and standards on the legislation of the European Union (EU) is not very strong. The influence of Member States in IOSCO is strong due to their large presence in the Board of IOSCO as permanent members. The EU is also well represented by the European Securities and Markets Authority (ESMA) which has gained quickly recognition as an Associate Member with observer status at the Board of IOSCO. However, the EU could gain more influence in IOSCO by a change in the composition of the Board of Supervisors (BoS) of ESMA by adding, on the model of the European Central Bank (ECB), appointed directors to the managing board of ESMA who would also vote in the BoS. They would represent better the European interests. This would help ESMA to define an harmonised EU view before discussions in IOSCO and strenghens the EU position in IOSCO. Also, the report advocates that the European Parliament strongly support the proposal for IOSCO to have a role in settlement of disputes in Cross-Border Regulation as it would ensure an international level playing field and facilitate the recognition of equivalence of regimes.

Keywords: IOSCO, European Union, ESMA, Soft-law

JEL Classification: K00, K22, K33