Project Director: Professor Michael G. Bridge | Project Administrator: Pauline Jackson | Events | News | Sustainable Finance Project
Law and Financial Markets Project
The Law and Financial Markets Project is an academic and practitioner based initiative established by The London School of Economics and Political Science. Based in the LSE's Law Department, the Project, amongst other things, aims to bridge the gap between lawyers in the commercial world and those in academic institutions. It provides opportunities for UK and overseas lawyers to participate in the study and analysis of how law (including regulation) serves and interacts with financial market activity. The role of law in a highly competitive, international market place is high on the Project's agenda, as is its role in facilitating investment in developing countries. Areas where the law requires reform or a greater degree of harmonisation or certainty, whether in England, the EU or elsewhere, are also a key feature. ...
The Project's academic focus is the study of:
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The interaction between law and financial markets, including: |
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the extent to which market behaviour shapes the law and vice versa; |
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new laws, regulations and EU directives which are specifically intended to enable the law to "keep up" with market developments; |
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the effect of laws and regulations covering anti-money laundering, anti-terrorism etc. on market behaviour . |
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the impact of codes of conduct and other types of "soft" law; |
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the approach of the courts to financial law issues and the response of market participants; |
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the role of law in assisting the development of (i) markets in emerging economies in Central and Eastern Europe (ii) a single financial services market in the EU; |
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the extent to which national laws can, by themselves, serve and regulate global market activity. |
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Substantive law in key areas, such as: |
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set-off and netting and related issues in clearance and settlement systems; |
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financial collateral and other forms of security interest relevant to wholesale and retail markets; |
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recharacterisation ; |
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insolvency law's so-called "rescue culture"; |
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dematerialised securities and indirect holding systems; |
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lender liability; environmental and "stakeholder" issues; liability for keeping "doomed" businesses afloat; "suitability" and mis-selling; impact of the compensation culture and consumerism, complaints procedures, role of ombudsman etc. |
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insider dealing and other forms of market abuse. |
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The Financial Markets Regulatory System, including: |
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the relationship between the UK's system, based on the Financial Services and Markets Act, and "soft law"; |
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the approach of the Financial Services Authority to law making, enforcement and sanctions; the advantages and disadvantages of concentration of power in the regulator; |
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the extent to which a level playing field is being established in the EU (and between the EU and the US); |
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the limits of regulation in relation to the control and management of systemic risk; |
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The Project provides a framework for (a) collaborative work such as workshops, seminars and collective writing projects and (b) a research group involving not only LSE staff but also lawyers and others from outside academia seeking to explore issues in a mixed academic/practitioner environment.
In due course, it is expected that various aspects of the Project's study topics will become the focus of new, self-standing academic and training courses. (A new LLM course on legal risk in the financial markets, for example, was introduced in 2007/08).
The Project involves the LSE Law Department's established experts in related fields such as EU, regulatory, criminal and insolvency law working together with finance lawyers to study the application in practice of legal developments in those fields in the specific context of the financial markets.
The Director of the Project is Professor Michael G. Bridge. Other LSE lawyers participating in the Project include Julia Black, Jonathan Fisher QC, Jeffrey Golden, Roger McCormick, Eva Micheler and Philipp Paech. The administrator of the Project is Pauline E. Jackson.
Sustainable Finance Project
The Project has launched a new research programme on Sustainable Finance. This is being led by the Roger McCormick.
Initial Objectives
The Sustainable Finance Project’s objectives are, first, to develop and, as far as possible, achieve international consensus on the following:
a) the legitimate aspirations of market participants and others in relation to sustainability in the context of financial market activity;
b) what is meant by “sustainable” in the context of:
lending to capital projects
lending to corporates
retail banking
insurance and re-insurance (including insurance broking)
private equity, venture capital and hedge funds
wholesale financial markets
sovereign wealth funds
microfinance; and
c) the relationship between ethical awareness (as reflected in the culture of a financial institution) and the desire to conduct business with due regard to "sustainability"; and
d) the ways in which the adoption of good governance practices and principles can be buttressed by greater accountability, changes in culture and structural changes in the relationships with stakeholders in civil society
In the context of the above, the Sustainable Finance Project will explore the possibility of extending the concept of “ESG” (environment, social, governance) to embrace Systemic Responsibility within financial institutions, i.e. the adoption of a business and risk management culture that takes full account of the institution’s responsibilities (in addition to those of regulatory bodies) in relation to the maintenance of a sustainable financial system, particularly in times of extreme financial instability.
Other objectives of the Project include
the development of a methodology for assessing the success of market participants in achieving sustainability goals;
assessing the relationship between the success referred to above (or lack of it) and reputational risk and other formal or informal sanctions;
assessing the impact on the above issues of law and regulation and of “soft law”.
Enquiries about the Sustainable Finance Project should be addressed to rsmccormick@btinternet.com or paulqwatchman@hotmail.co.uk
LAW AND FINANCIAL MARKETS PROJECT
Wednesday 26 October 2011
The London Law Club Event
A loose association of London academics and judges gathered together under the aegis of the LFMP, to consider a presentation paper on '"Direct Transfers" in the Law of Unjust Enrichment' by Stephen Watterson. ̶ flyer ̶ read the paper
LAW AND FINANCIAL MARKETS PROJECT
Wednesday 26 January 2011
European Takeover Law - The Case for a Neutral Approach
Speaker: Professor Luca Enriques (Commissioner of the Italian securities regulator, Consob; Professor of Law at the University of Bologna; member of the European Corporate Governance Institute)
SUSTAINABLE FINANCE PROJECT
10 February 2011
'The Equator Principles: their application and effectiveness in project finance'
Speaker: Paul Watchman
LAW AND FINANCIAL MARKETS PROJECT
18 March 2011
Professor Julia Black discussing her paper 'Breaking up is hard to do: The future of UK financial regulation'
LAW AND FINANCIAL MARKETS PROJECT
29 March 2011
Seminar: 'Disguised Returns of Capital'
Eva Micheler
LAW & FINANCIAL MARKETS PROJECT
30 March 2011
COLLOQUIUM:
'Global Finance Crisis and Economic Crime'
Speaker: Richard Alderman (Director, SFO)
[flyer] [discussion
paper abstract]
[Alderman transcript]
LAW & FINANCIAL MARKETS PROJECT
CONFERENCE:
12 May 2011
Cross-jurisdictional netting and global solutions [see top of this page for papers, documentation &c.]
LAW & FINANCIAL MARKETS PROJECT
CONFERENCE:
12 May 2011
Cross-jurisdictional netting and global solutions
The internationalisation of the financial market requires netting to connect
smoothly across jurisdictions so as to guarantee that netting agreements remain
enforceable even in the event of insolvency of one of the parties. Recent
legislation on bank resolution (e.g., in the UK, the Banking Act 2009) has
highlighted the potential incompatibilities of netting agreements with bank
resolution procedures. Against this background, international initiatives are
unfolding at present, as the European Commission and Unidroit are about
launching relevant projects in this area.
Paper
Paper: 'Netting and resolution powers Global problems, local solutions?' by Philipp Paech
Presentations
'Russian Netting Legislation' by Tamer Amara
'Challenges facing CCP Netting‘ by Jo Braithwaite
'Legal challenges to netting in bank restructuring' by Geoff Davies
'Netting, Insolvency & Agency Transactions' by Wim Hautekiet
'The Economics of CCP Operations and Netting' by Robert Kosowski
'Cross-Jurisdictional Netting and Global Solutions – Latin America' by Sharmini Mahendran
'Elements of a workable cross-border framework' by Edward Murray
'Update on Netting in Asia' by Peter M Werner
LAW & FINANCIAL MARKETS PROJECT / TRANSNATIONAL LAW PROJECT
16 May 2011
‘Arbitration and Financial Markets Dispute’
Speakers: Jeffrey Golden (LSE) and Jan Paulsson (LSE)
The 2nd LSE Arbitration Debate, which is jointly organised by the Transnational Law Project and the Law & Financial Markets Project, brings together Jeffrey Golden, the main author of the ISDA Master Agreements and the driving force behind efforts to set up an International Financial Court, and Jan Paulsson, who will take on Jeffrey’s question marks about the suitability of the general use of arbitration for financial market disputes.
6-8 July 2011
Financial
Law Issues
for Lawyers in Transition Economies
A three day series of seminars in London jointly hosted by The London School of Economics and Political Science and the European Bank for Reconstruction and Development.
Research Assistants
Post-graduate students and others who might be interested in working as a Research Assistant attached to the Project (usually on a part-time basis) should contact Roger McCormick. Please note, however, that such positions only become available from time to time, depending on Project-related activities.
Applications for Academic Courses and Research
Applications for the LLM course and the MPhil PhD Degree in respect of topics within the scope of the Project should be sent in the first place to the Graduate Admissions Office.
PhD admissions enquiries, please contact Rachel Yarham or refer to the PhD Prospective Students page.
Publications
LFMP and Herbert Smith hosted a seminar in December 2010 with HM Treasury on the future of UK financial regulation. The accompanying discussion paper, by Julia Black and Martyn Hopper, discusses the objectives, remit, powers and accountability of the new regulators and sets out key principles to guide the reform.
click here for the full report
Information about the department's arrangements for Visiting Fellowships can be found here.
Herbert Smith, Freshfields Bruckhaus Deringer and Gómez-Acebo & Pombo Abogados are the project's Foundation Sponsors. For details of the benefits of Foundation Sponsorship and other sponsorship opportunities, please contact the Project Director, Professor Michael Bridge.
Financial Markets Law and Regulation for Transition Economies
4-6 July 2012
A three day series of seminars in London jointly hosted by the London School of Economics and Political Science and the European Bank for Reconstruction and Development
Save The Children Cricket : Anyone who (a) is interested in cricket and (b) would like to volunteer to help the Save The Children charity should please contact Roger McCormick at rsmccormick@btinternet.com
At the end of the Summer Term 2011, Roger McCormick will step down as Project Director, having founded the Law and Financial Markets Project and served five years in the role. He will be succeeded by Professor Michael G. Bridge. Roger will continue as director of the Sustainable Finance Project.
Paul Watchman, Visiting Senior Fellow has contributed a chapter on 'social responsibility and fiduciary duties of trustees' in to Paul Thornton and Donald Fleming (ed.) Good Governance for Pensions Schemes (CUP, Cambridge 2011). The work has been described by Lord Hutton of Furness in the FT as "an excellent compendium of advice and best practice" and a "scholarly contribution which [overall] merits a place on the desk of everyone working in the field of pensions government today.
Paul Watchman has been appointed with Paul Wooley of the LSE [Centre for the Study of Dysfunctional Capital Markets] to the Advisory Group of the Nuffield funded study Protecting Our Best Interests on fiduciary duties and pensions management. The study is a follow-up by Fair Pensions to their 2011 report, Protecting Our Best Interests: Rediscovering Fiduciary Obligation, March 2011. Paul Watchman was also a member of the Nuffield Advisory Group on that study.
Roger McCormick and Paul Watchman have advised the UNEP FI on fiduciary duties and sustainable finance for their conference, 'Tipping the Balance', to be held in Washington in October 2011.
Robert Monks made many positive references at the UCGN Conference in Paris in September 2011 to the work carried out by Paul Watchman on fiduciary duties and integrating ESG into investment decision-making contained in two UNEP FI thought leading reports, The Freshfields UNEP FI Report ( 2005) and Fiduciary Duties (2009). The former report holds the record as the most downloaded UN Report in UN history. Both reports may be accessed by the UNEP FI website.
NEWS, LECTURES, EVENTS IN 2010
13 December 2010
Herbert Smith and the London School of Economics jointly hosted a roundtable discussion which drew together people from the financial services, legal, academic and trade body community, together with key policy decision makers at HM Treasury and the regulators to debate key issues.
24 November 2010
The Law and Financial Markets Project hosted the second London Law Club Seminar and Dinner for senior academics and senior members of the judiciary. A discussion paper on Anti-Deprivation Clauses was produced by Sarah Worthington.
[article: 'Insolvency Deprivation, Public Policy and Priority Flip Clauses' by Sarah Worthington]
12 October 2010
Roger McCormick contributes chapter on the UK
position to the IBA Financial Crisis Task Force Report on regulatory
responses.
'Enforcing the New Regime: Incentive or Deterrence?' [ read programme]
23 June 2010
'Are UK Companies too
exposed to takeovers?'
In the wake of Kraft’s takeover of Cadbury Plc, concerns have been raised both by business leaders and Government ministers that UK companies are too exposed to takeover. The Takeover Panel has published a consultation document addressing these concerns. This seminar aims to provide a forum for business leaders, fund managers, regulators and lawyers to discuss this issue. Panel members include Charlie Crawshay (Deputy Director of the Takeover Panel); Sir Richard Lapthorne (Chairman of Cable & Wireless Communications); David Paterson (Partner, Herbert Smith LLP ); Colin Melvin (CEO of Hermes Equity Ownership Services); David Kershaw (Professor of Law, LSE)
23-25 June 2010
Financial Law Issues
for Lawyers in Transition Economies
A three day series of seminars in London jointly hosted by The London School
of Economics and Political Science and the European Bank for Reconstruction
and Development.
[read more ...]
08 June 2010
Professor McCormick on CNBC
Professor Roger McCormick, director of the
Law and Financial Markets Project, appeared on US television
yesterday, talking on CNBC regarding the G20 dropping the idea of a
bank levy. "Some of the steam has gone out of the push for a united
global financial regulation" said Professor McCormick.
'Competition Law: Financial Stability and the Rules of the Game.' [read programme]
28 April
Seminar (London Law Club)
'Unassignable Rights' by Professor Michael Bridge [read discussion paper]
'Self-Regulation is dead. Long live self-regulation?' [read discussion paper]
4 February 2010
‘Lord Hoffmann’s Contribution to
Company Law’
This seminar, attended by Lord Hoffmann himself, addressed three of the key areas in which Lord Hoffmann’s judgments have made a significant contribution to UK company law: the unfair prejudice remedy; the duty of care; and rules of attribution. The seminar was attended by members of the judiciary, leading corporate barristers and solicitors; and US and UK corporate legal academics. Short papers were given in each of the three areas followed by comments from Lord Hoffmann and then a very lively discussion. Papers on the unfair prejudice remedy were given by Professor John Armour and Mr Leslie Kosmin QC; papers on the duty of care by Justice Jack Jacobs and David Kershaw; and papers on the rules of attribution were given by Professor Eilis Ferran and Mr Jonathan Sumption QC.
