Niamh Moloney

please note:
on leave Lent 2017

Administrative support: Alison Grant
Room:  New Academic Building 6.18a
Tel. 020-7955-7689

Professor Niamh Moloney is a graduate of Trinity College Dublin and Harvard Law School. She specializes in EU financial market regulation and wrote the first monograph on this topic, now in its third edition (EU Securities and Financial Markets Regulation, Oxford University Press, 2014). Her other books include The Regulatory Aftermath of the Global Financial Crisis (Cambridge University Press, 2012, with John C. Coffee, Eilís Ferran, and Jennifer Hill) and How to Protect Investors. Lessons from the EU and the UK (Cambridge University Press, 2010). Niamh is an editorial board member of a number of journals, an editor of the Oxford Handbook of Financial Regulation (Oxford University Press, 2015), and a series editor of the Cambridge University Press Series on International Corporate Law and Capital Market Regulation. Niamh has been a Visiting Professor in a number of institutions internationally, including recently Bocconi University, Milan, the University of Zurich, and Columbia Law School, New York, and is a Fellow (Household Finance) of the House of Finance, Goethe University, Frankfurt.

Research Interests

Niamh's main research interest is to explore the EU's regulation of financial markets and services from institutional, substantive, and contextual perspectives. She is particularly interested in the consumer markets.

External Activities

Niamh’s appointments include member of the inaugural (2011-2013) and second (2013-2015) advisory Securities and Markets Stakeholder Group of the European Securities and Markets Authority (ESMA), and member, Consumer Advisory Group, Central Bank of Ireland. She was the Special Adviser to the major 2014-2015 inquiry by the UK Parliament House of Lords EU Select Committee into the EU’s regulatory response to the financial crisis which reported in February 2015 (The post-crisis EU financial regulatory framework: do the pieces fit?). Niamh has also served as a member of the UK Financial Conduct Authority’s advisory Financial Services Consumer Panel, has acted as an Expert Witness for UK Parliament Select Committee and for European Parliament inquiries on financial market regulation matters, and is a member of the Board of Trustees of the Academy of European Law, Trier.


Oxford Handbook of Financial Regulation (ed, with Professor Eilís Ferran and Professor Jennifer Payne) (OUP, 2015)

The financial system and its regulation have undergone exponential growth and dramatic reform over the last thirty years. This period has witnessed major developments in the nature and intensity of financial markets, as well as repeated cycles of regulatory reform and development, often linked to crisis conditions. The recent financial crisis has led to unparalleled interest in financial regulation from policymakers, economists, legal practitioners, and the academic community, and has prompted large-scale regulatory reform. The Oxford Handbook of Financial Regulation is the first comprehensive, authoritative, and state-of-the-art account of the nature of financial regulation. Written by an international team of leading scholars in the field, it takes a contextual and comparative approach to examine scholarly, policy, and regulatory developments in the past three decades.

EU Securities and Financial Markets Regulation (OUP, 2014, 3 edition)

EC Securities Regulation - coverEU Securities and Financial Markets Regulation provides the first comprehensive, critical, and contextual account of the vast new rule-book which now applies to the EU financial market in the aftermath of the seismic reforms which have followed the financial crisis. Topics covered in-depth include the AIFMD, EMIR, the Short Selling Regulation, the new market abuse and transparency regimes, the rating agency regime, the UCITS IV-VI reforms, and MiFID II/MiFIR; the analysis is wide-reaching, extending to secondary legislation and relevant soft law.

The Regulatory Aftermath of the Global Financial Crisis (with Eilís Ferran, Jennifer G. Hill, John C. Coffee, Jr) (Cambridge University Press 2012)

The EU and the US responded to the global financial crisis by changing the rules for the functioning of financial services and markets and by establishing new oversight bodies. With the US Dodd–Frank Act and numerous EU regulations and directives now in place, this book provides a timely and thoughtful explanation of the key elements of the new regimes in both regions, of the political processes which shaped their content and of their practical impact. Insights from areas such as economics, political science and financial history elucidate the significance of the reforms. Australia's resilience during the financial crisis, which contrasted sharply with the severe problems that were experienced in the EU and the US, is also examined. The comparison between the performances of these major economies in a period of such extreme stress tells us much about the complex regulatory and economic ecosystems of which financial markets are a part.

K. Alexander and N. Moloney (eds) Law Reform and Financial Markets (Cheltenham: Edward Elgar, 2011)

Law Reform and Financial Markets addresses how law reform can be used to support strong financial markets and draws on the global financial crisis as a case study.






How to Protect Investors. Lessons from the EC and the UK (Cambridge University Press, 2010)

Taking as a case study the wide-ranging investor protection regime which governs Europe's retail markets after an intense reform period, the book provides a critical, comparative and contextual examination of the nature of investor protection, exploring why the retail investor should be protected, whether retail investor engagement with the markets should be encouraged, and how investor-protection laws should be designed, particularly in light of the financial crisis.

EC Securities Regulation 2nd. ed. (Oxford University Press, 2008)

EC Securities Regulation - coverIn the wake of radical and far-reaching legal, market, and institutional reforms which followed the completion of the Financial Services Action Plan, the EC regime for securities regulation now governs Community financial markets and has almost replaced national law in this area. This long-awaited second edition of EC Securities Regulation considers the extensive new regime in its legal, institutional, political, and market context and assesses the forces which have shaped it.

Selected articles
and chapters in books

'Extracting the UK from EU Financial Services Governance: Regulatory Recasting or Shadowing from a Distance?' in M Dougan (ed), The UK after Brexit. Legal and Policy Challenges (Intersentia, 2017) [FORTHCOMING]

'"Bending to Uniformity": EU Financial Regulation with and without the UK' Fordham International Law Journal (2017) [FORTHCOMING]

'Brexit, the EU and its Investment Banker: Rethinking ‘Equivalence’ for the EU Capital Market' LSE Law Society and Economy Working Paper Series, 05/2017

The EU/UK negotiations on Brexit are now imminent following the formal notification by Prime Minister May of the UK’s intention to leave the EU in the ‘Article 50 letter’ delivered to European Council President Tusk on 29 March 2017. The treatment of financial services will be a critical element of these negotiations. Prime Minister May had previously indicated in her 17 January 2017 speech on the UK’s negotiating objectives that the UK is to leave the single market and confirmed this position in the Article 50 letter. Under current EU financial law the UK will accordingly become a ‘third country’ on Brexit. UK financial firms and actors will lose the ability to ‘passport’ into the single market in financial services from the UK – unless passporting rights are preserved under any new EU/UK arrangement, an outcome which is highly unlikely. This paper considers the risks to the EU from its oft-described ‘investment banker’ becoming a third country and explores the regulatory remedies which may be available and the preferences which may shape these remedies.
    The paper adopts a legal-institutionalist perspective, which draws on the insights of comparative/international political economy, to examine the implications of the UK’s future status as a ‘third country’ for the EU capital market and for its current flagship Capital Markets Union (CMU) agenda. The extent to which EU regulation is transformative is contested in relation to the development of the EU capital market. But the EU regulatory regime which governs third country access to the EU capital market is likely to be a significant determinant of the strength of the EU’s capacity to absorb the loss of the UK from the single EU capital market and to contain related stability, liquidity, and efficiency risks. Drawing on international experience with access arrangements and on EU preferences and incentives, the paper considers the likely future of the current third country regime and how it might be re-configured so that third country access is based on a more secure footing.

'Negotiating a Financial Services Deal'  LSE Law Policy Briefing: Brexit Special Issue 25/2017

The upcoming negotiations on the UK’s exit from the EU can be expected to take particular account of financial services, the treatment of which has dominated much of the policy discourse on Brexit since June 2016.

'EU Financial Governance and Brexit: Institutional Change or Business as Usual?' 42(1) European Law Review (2017) 112

'The EU in Global Financial Governance' 3 (1) Russell Sage Foundation Journal of the Social Sciences (2017) 138

'EU Financial Governance and Trading Transparency Regulation: A Test Case for the Effectiveness of Post Crisis Administrative Governance' in D Busch and G Ferrarini (eds), Regulation of EU Financial Markets: MiFID II (Oxford University Press, 2017)

'International Financial Governance, the EU, and Brexit: the "agencification" of EU financial governance and the implications' (2016) 17 European Business Organization Law Review 451

'The 2013 Capital Requirements Directive IV and Capital Requirements Regulation: Implications and Institutional Effects' Zeitschrift fur Offentliches Recht (Austrian Journal of Public and International Law) (2016) 385

'Institutional Governance and Capital Markets Union: Incrementalism or a 'Big Bang'?' (2016) European Company and Financial Law Review 13(2) 376

'Financial Services, the EU, and Brexit: An Uncertain Future for
the City?'  (2016) 17 German Law Journal 75,  Brexit Supplement

'Capital Markets Union: Ever Closer Union for the EU Financial System?' (2016) 3 European Law Review 307

'Conduct Rules and Investor Protection: The Evolution of the EU’s Approach' in M Casper, L Klöhn, W-H Roth and C Schmies, Festschrift für Johannes Köndgen (RWS, 2016)

‘Banking Union and the Implications for Financial Market Governance in the EU: Convergence or Divergence?’ in D Busch and G Ferrarini (eds), European Banking Union (OUP, 2015) 524

‘Financial Market Governance and Consumer Protection in the EU’ in E Faia, A Hackenthal, M Haliassos, and K Langenbucher (eds), Financial Regulation A Transatlantic Perspective (CUP, 2015) 221

‘Regulating the Retail Markets’ in N Moloney, E Ferran, and J Payne (eds), The Oxford Handbook of Financial Regulation (OUP, 2015) 736

‘Financial Market Regulation’ in A Arnull and D Chalmers (eds), The Oxford Handbook of EU Law (OUP, 2015) 757

'European Banking Union: Assessing its Risks and Resilience' (2014) 51 Common Market Law Review 1609

On 4 November 2014 the EU's ambitious Banking Union (BU) project reached a major milestone when the Single Supervisory Mechanism became operational. After difficult negotiations, the legal regime supporting the Single Resolution Mechanism is now in place; BU is becoming a reality. This article charts how the EU, long a regulator of the EU banking market, has grappled with the operational elements of banking system governance in constructing BU. It suggests that BU's foundational regulatory technology is relatively robust, given the difficult political, institutional, and Treaty conditions which attended its construction; initial indications relating to the Single Supervisory Mechanism augur well. But the article also highlights the many uncertainties which attend BU, notably with respect to operational effectiveness, constitutional resilience, and the euro area/internal market asymmetry, and which may have far-reaching effects on EU banking market governance generally.

'I. Resetting the Location of Regulatory and Supervisory Control over EU Financial Markets: Lessons from Five Years On', International and Comparative Legal Quartery, 62 (4) (2013), pp.955-965

'The European Securities and Markets Authority: A Perspective from One Year On' 68 Zeitschrift fur Offentliches Recht (Austrian Journal of Public and International Law) (2013) 59

‘Reshaping Order Execution in the EU and the Role of Interest Groups: From MiFID I to MiFID II’ 13 European Business Organization Law Review (2012) 557 (with G Ferrarini)

‘Supervision in the Wake of the Financial Crisis: Achieving Effective ’Law in Action’ - A Challenge for the EU’ in E. Wymeersch, K. Hopt and G. Ferrarini, Financial Regulation and Supervision. A Post Crisis Analysis (OUP, 2012), 71

‘Guest Editorial: MiFID II - Reshaping the Perimeter of EU Trading Market Regulation’ 6 Law and Financial Markets Review (2012) 327

‘The Liability of Asset Managers: A Comment’ 7 Capital Markets Law Journal (2012)

'The EU and Executive Pay: Managing Harmonization Risks’ in R Thomas and J Hill (eds), Research Handbook on Executive Pay (Elgar, 2012), 466.

‘The Investor Model Underlying the EU’s Investor Protection Regime: Consumers or Investors?’ 13 European Business Organization Law Review (2012) 169.

‘The December 2011 Veto and UK Financial Market Regulation’ 27 Butterworths Journal of International Banking and Financial Law (2012) 211

'Reform or Revolution? The Financial Crisis, EU Financial Markets Law and the European Securities and Markets Authority' 60(2) International and Comparative Law Quarterly (2011) 521

Since the outset of the financial crisis, the EU financial markets regime has been undergoing a period of turbulence which contrasts sharply with the period of relative stability which it briefly enjoyed over 2005–2007 and post-FSAP (Financial Services Action Plan). The FSAP reforms had been adopted. The Committee of European Securities Regulators (CESR) had emerged as an influential actor, driving some degree of supervisory coordination and co-operation and constructing a significant soft law ‘rule-book.’ And the 2007 Lamfalussy Review suggested broad political, institutional and stakeholder satisfaction with the Lamfalussy process. There was little enthusiasm for grand adventures in institutional design, albeit that supervision, an institutionally-driven concern, was presciently if belatedly emerging as a concern of the EU institutions. The Review's main concern, however, was with strengthening the pragmatic, if somewhat haphazard, network-based, ‘supervisory convergence’ model as the means for supervising the integrating EU financial market. With respect to regulation, reflecting the wider international zeitgeist pre-crisis, ‘Better Regulation’ and the need for a ‘regulatory pause’ were the watchwords of a Commission which, once the massive FSAP regime was safely in place, espoused the benefits of self-regulation and highlighted the risks of intervention without impact assessment, extensive consultation and evidence of market failure. This was most apparent with respect to credit rating agencies, debt market transparency, hedge funds, and clearing and settlement. Institutionally, a relatively sophisticated law-making apparatus, in the form of the Lamfalussy structures, a plethora of advisory bodies and stakeholder bodies (notably FIN-NET which represents the consumer and SME interest), had been established.#

'The European Securities and Markets Authority and Institutional Design for the EU Financial Market - a Tale of Two Competences: Part (2) Rules in Action' 12(2) European Business Organization Law Review (2011) 177

The purpose of this article, and of its earlier companion article (Part (1) Rule-making, 12 European Business Organization Law Review (2011) p. 41), is to examine the implications of the new European Securities and Markets Authority which was established in January 2011.

'The European Securities and Market Authority and Institutional Design for the EU Financial Markets – a Tale of Two Competences: Part (1) Rule-Making' 12(1) European Business Organization Law Review (2011) 41

The purpose of this article, and its companion article, is to examine the implications of the new European Securities and Markets Authority, established in January 2011.

'Regulating the Retail Markets: Law, Policy, and the Financial Crisis' in O Cinneide and Letsas eds, Current Legal Problems (OUP, 2010, volume 63) 375

'EU Financial Market Regulation after the Global Financial Crisis: "More Europe" or more Risks?' 47 (5) Common Market Law Review (2010) 1317

This article charts the EU's regulatory response to the global financial crisis, and explores what the response suggests about the new regulatory landscape and its risks. It explores how the current reform programme, in contrast to earlier reform periods, has been dominated by a concern to manage the pathology of the internal market through intensive EU "rules on the books" (law-making) but also, and for the first time in EU financial market regulation, through more radical "rules in action" (supervision and enforcement). The defining feature of the post-crisis reform movement seems to be the array of influences, chief among the new institutional structures, which are driving the financial markets regime toward greater centralization. The article examines this decisive move towards "More Europe" and assesses its ramifications. It argues that, while radical reform is certainly needed, the extent to which the EU now governs financial market regulation does generate risks, particularly with respect to the extent to which Member State flexibility and discretion is being squeezed from the regime.

'The Financial Crisis and EU Securities Law-Making : A Challenge Met?' in Grundmann et al. (eds), Festschrift fur Klaus J Hopt zum 70 Geburstag (Verlag Walter de Gruyter, 2010) 2265

'Financial Services and Markets' in Baldwin, Cave and Lodge (eds), The Oxford Handbook on Regulation (OUP, 2010) 437

‘Regulating Retail Investment Products: The Crisis and the EU Challenge' 11 ERA Forum 329 (2010)

‘Executive Remuneration in Crisis: A Critical Assessment of Reform in Europe’ 10 Journal of Corporate Law Studies (2010) 73 (with G Ferrarini and M C Ungureanu)

This article considers the regulation "on the books" of executive pay across the EU and the evidence "in action" on corporate practice concerning executive pay (based on disclosures by FTSE Eurofirst 300 companies) in relation to the best practice recommendations set out in two key Commission Recommendations from 2004 and 2005. It finds that Member State implementation of the two Recommendations has been patchy and, in particular, that reliance on Corporate Governance Codes has not resulted in the embedding of good practices, particularly with respect to disclosure concerning executive pay, across Europe's largest companies. It argues that if the EU is to succeed in promoting stronger alignment between shareholder and manager interests by means of the executive pay contract, closer attention is needed to remuneration governance and that a mandatory, harmonised disclosure obligation should be introduced. Although the Commission has recently adopted a 2009 Recommendation on executive pay in the corporate sector generally as part of its response to the financial crisis, the article suggests that this attempt to influence the design of executive pay is misconceived and that attention would have been better focused on the enforcement of basic disclosure obligations.

'The Committee of European Securities Regulators and Level 3 of the Lamfalussy Process' in Tison, de Wulf, van der Elst, and Steennot (eds), Perspectives in Company Law and Financial Regulation (Cambridge University Press, 2009), 449

Perspectives in Company Law and Financial Regulation - coverThis collection of essays has been compiled in honour of Professor Eddy Wymeersch on the occasion of his retirement as professor at Ghent University. His main international academic peers explore developments on the crossroads of company law and financial regulation in Europe and the United States, providing a unique view on the dynamics of regulatory competition in an era of economic globalisation, whether in the fields of rulemaking, organising the mobility of capital or the enforcement of rules. The deepening of European financial integration and the transatlantic regulatory dialogue has generated new paradigms of rule-setting in a multinational framework and reinforced the need to develop adequate instruments for co-operation between regulators. Regulators increasingly use concepts such as equivalence or mutual recognition to regulate cross-border relations. 

'Regulation of the Markets and Intermediaries: Global Comparison and Contrast - What is Best Practice' 5 Macquarie Journal of Business Law (2008) 26

'Reforming Investor Protection: Lessons from the European Union's Reform Agenda' 4 Macquarie Journal of Business Law (2007) 147

'Innovation and Risk in EC Financial Market Regulation After the Financial Services Action Plan: New Instruments of Financial Market Intervention and the Committee of European Securities Regulators' 32 European Law Review (2007) 627

'EC Company Law' (Oxford University Press, 2007) in D Vaughan and A Robertson (eds), Law of the European Union (Oxford University Press), para 20.1 – para 20.1215

'Law Making Risks in EC Financial Market Regulation After the Financial Services Action Plan' in S Weatherill (ed), Better Regulation (Hart Publishing, 2007) 367

The discourse of 'Better Regulation' is a hot topic, intimately associated with the drive for cost savings and a more efficient economy. In the UK and in the EU, rule-makers have lately endeavoured to achieve a more satisfactory balance between the demands of proper protection from market failure and inequity on the one hand, and commercial freedom and the potential for innovation on the other. But who is the regulator listening to, and what effect does this have on the regulatory pattern governing the integrating EU market? What is best practice in the matter of regulatory assessment. The essays in this collection explore these and other questions and will foster greater understanding of UK and EU regulation, the accountability issues involved, and problems of enforcement. It is no coincidence that since efforts to construct a Constitution for Europe have stalled the attention of policy-makers, politicians and the business community has turned instead to the quest for Better Regulation - or perhaps, it might be said, a "Better European Union".

'TransAtlantic Financial Services Dialogue' 7(4) European Business Organisation Law Review (2006) 647 (with Dr Kern Alexander, Professor Eilís Ferran, and Professor Howell Jackson); also published in the Harvard Law School, Olin Center Faculty Discussion Paper Series, No 1/2007

The Transatlantic Financial Markets Dialogue led by the SEC and the European Commission has achieved some notable successes, particularly with respect to the consolidated supervision of financial conglomerates and the development of a plan to achieve convergence in corporate financial reporting. On both sides of the Atlantic there is a clear ongoing commitment to the Dialogue as a key mechanism for the development of efficient and credible regulatory solutions that guarantee effective investor protection and a high level of business efficiency. This paper reports on a two-day roundtable discussion that took place at Cambridge University, UK, in September 2005 to explore ways in which the academic community can contribute to this transatlantic debate. Lively discussion between the policymakers, regulators, market participants and academics who attended the roundtable yielded a number of thematic concerns, which, the paper suggests, could form the basis of a programme for further work. Finally, the paper announces the establishment of a seminar series, to be based in the UK, on the Transatlantic Financial Services Regulatory Dialogue and invites contributions.

'Financial Market Regulation in the post Financial Services Action Plan Era' 55(4) International and Comparative Law Quarterly (2006) pp982-992

After a hectic period of law reform, which has also provoked major governance reforms in the form of significantly increased levels of transparency and market consultation and major institutional innovations (with allied accountability and governance risks), the 1999 Financial Services Action Plan (FSAP)1 has now been completed. It has radically transformed the regulatory landscape for financial services in the EC, and set a seal on the recharacterization of EC financial services law from a minimum harmonization-based market construction regime to a highly interventionist and increasingly sophisti-cated market regulation system. In particular, the coincidence of legislative reform under the FSAP with the development of a new institutional process for law-making, which has rapidly become embedded in the financial market architecture (the Lamfalussy process),2 produced a reform agenda of immense depth and range. The FSAP period has also seen the use and development of a wide range of regulatory tools in EC financial services policy in line with the growing sophistication of the regulatory regime. While disclosure has long been a key policy tool of EC financial services law, the FSAP saw a closer focus on conflict of interest management across the financial sector, on more interventionist controls such as transparency, suitability, and best execution requirements, and on calibrating regulation to different investor profiles and different market risks. This article considers a selection of key recent developments.

'Effective Policy Design for the Retail Investment Services Market: Challenges and Choices Post FSAP' in G Ferrarini and E Wymeersch (eds), Investor Protection in Europe: Corporate Law Making, the MiFID and Beyond (Oxford University Press, 2006) 381

EU policy in the area of corporate governance and capital markets is being reoriented. Harmonization is less frequently seen as a concept in company law; regulatory competition is on the rise; and experiments in soft law are being carried out. Several Member States have recently reformed their corporate laws, wither as a reaction to financial scandals or in an effort to enhance investment. Convergence has increased as a result, particularly towards Anglo-American standards. Yet differences still exist, profoundly rooted in national systems of corporate governance. By contrast, capital markets law would seem to be an exception, having undergone intense harmonization in the last few years through the Lamfalussy regulatory architecture. Nonetheless, a European system of securities regulation is not yet in place. Regulation is predominantly domestic, while private laws affecting capital markets are still divergent.  This volume examines the ongoing debate from an interdisciplinary perspective. Part 1 explores the political determinants of corporate governance and evaluates likely convergence and the role of regulatory competition. Part 2 considers the Markets in Financial Instruments Directive (MIFID) and its central role in harmonizing EU securities trading. Part 3 analyzes the MiFID more deeply and explores other measures including the Prospectus and Transparency Directives. Part 4 offers future perspectives on the post-FSAP era. 

'The EC and the Hedge Fund Challenge: A Test Case for EC Securities Policy After the Financial Services Action Plan' 6(1) Journal of Corporate Law Studies (2006) 1

This article considers the burgeoning hedge fund challenge in the context of the post-FSAP regulatory and supervisory environment in the EC securities market. While it considers hedge fund risk, it also uses hedge funds as a case study to examine the resilience of the EC’s new regulatory and supervisory regime. Four questions are considered: What are the appropriate elements of an EC response to the hedge fund risk chain? Is the EC institutional framework sufficiently robust for the hedge fund challenge? What is the appropriate response to retail investor access risks? What is the appropriate response to the market stability risks raised by hedge funds’ large, undisclosed positions across markets? The hedge fund test reveals considerable weaknesses in the post-FSAP regulatory and supervisory structure. The EC’s response is likely to be revealing as to the sophistication of its policy-making structures post-FSAP.

'Executive Remuneration in the EU: the Context for Reform' 21 Oxford Review of Economic Policy (2005) 304 (with Professor Guido Ferrarini); also published in the European Corporate Governance Institute Working Paper Series, No. 32/2005

This paper shows how clear divergences arise across the EU in how executive remuneration is structured. Sharp differences also occur in the adoption of best practices in pay-setting and in the disclosure of executive pay. These divergences are broadly in line, as agency theory predicts, with block-holding and dispersed ownership governance profiles. While the EU has recently adopted two important 2004 Recommendations on executive pay, the paper argues that EU-led reforms should be undertaken with care. Harmonization should be limited and only address disclosure. Disclosure is central to the adoption of effective incentive contracts in that it can manage the particular agency costs of executive pay, across dispersed and blockholding systems, without intervening in governance choices and structures. Any other interventions in the pay process carry the risk of distorting competition and interfering with the dynamics of different ownership structures and economic contexts.

'Building a Retail Investment Culture Through Law: The Markets in Financial Instruments Directive' 6(3) European Business Organisations Law Review (2005) 341

This essay argues that the 2004 Markets in Financial Instruments Directive, the investment services cornerstone of the Financial Services Action Plan, represents a bold attempt to build a pan-EU retail investor culture, relying on the transformative effects of law. While the institutional markets have attracted most attention under the FSAP, this strategy represents a sharp change in EU policy, is ambitious given the state of the retail markets and provokes important questions as to the role of law in generating retail activity and the role of the retail investor in developing effective and strong EU capital markets. This essay examines how MIFID attempts to build a retail investment culture through law, the market reality behind this policy shift, what the role of law is in this process and what the emerging retail regime suggests as to the characteristics of the emerging ‘EU retail investor’ as a target of regulatory policy and engine of retail market integration. The newly adopted MIFID conduct of business regime lies at the heart of this ambitious retail agenda and is used as a case study in this analysis. The risks and costs of this approach are, however, high given the unproven relationship between law and investor activity, whether domestic or pan-EU. The essay therefore considers whether this new regulatory and policy strategy on the retail investor is sufficiently nuanced and, in particular, whether, given the risks of imposing inappropriate rules on an immature marketplace, it is matched by appropriate retail investor governance.

'Time to take Stock on the Markets&' 53 (4) International and Comparative Law Quarterly (2004) pp999-1012

The European Union's 1999 Financial Services Action Plan (the FSAP)an ambitious reform agenda of forty-two measures, was designed to provide the regulatory underpinning for a single deep and liquid capital market, in which pan-EU market actors are regulated by their home Member State under harmonized rules. This single capital market would lower the cost of capital, unlock funding sources for companies, and increase returns on savings, while widening choice and stimulating competition in the pan-EU financial services industry. After a surge of legislative activity over the last months of 2003 and through early 2004, the FSAP is on track for timely completion in mid-2004, as called for by the March 2003 Brussels European Council. The closing of the current session of the European Parliament in spring 2004, combined with a sharp political focus on the financial markets post-Enron and in the wake of Parmalat, has concentrated EU attention both inter-institutionally and in the market place on delivery of the outstanding measures.1 With the adoption of the cornerstone Financial Instruments Markets Directive in April 2004, the FSAP is now, in large part, complete. Implementation should be achieved across the EU by 2006.

'Executive Pay: Convergence in Law and Practice Across the EU Corporate Governance Faultline' 4(2) Journal of Corporate Law Studies (2004) 243 (with Professor Guido Ferrarini and Cristina Vespro)

This article considers the regulation of executive pay practices in listed companies in the European Union and the empirical evidence of pay practices, based on the FTSE Eurotop 300 membership’s annual report for 2001. The analysis is placed in the context of the dispersed ownership/blockholding ownership faultline which runs across EU corporate governance, and in light of recent EU initiatives, particularly the Commission’s May 2003 Company Law Action Plan and the 2004 Consultation on Executive Remuneration. The outstanding feature of executive pay in the EU is the extent to which it reflects the interconnection between pay and corporate governance or ownership structures. Executive pay, regarded as a management incentive contract, is a key agency-cost control mechanism in dispersed ownership systems. Legal controls on pay are accordingly at their most sophisticated, in terms of promoting the adoption of an optimal contract for shareholders, in those EU Member States where dispersed ownership dominates. These systems also see the heaviest reliance in practice on high-powered, equity-based, incentive-driven pay contracts. In blockholding systems, controlling shareholders can, in theory, monitor management directly without the need for an incentive contract. Pay controls are accordingly less sophisticated and, as revealed by the FTSE Eurotop 300 evidence, the prevalence of high-powered equity-based incentive contracts is reduced. Different concerns arise, however, as to the protection of minority shareholders from controlling blockholders.

'Shareholder Democracy and the Audit Process: TransAtlantic Perspectives Post Enron' 5(2) European Business Organisations Law Review (2004) 223 (with Professor Anita Anand)

In this article, the authors fill a gap in the legal literature surrounding post-Enron corporate governance reform by focusing on the need for enhanced shareholder voice in the auditing process. The authors expand on Anand's analysis in ‘Shareholder Isolation and the Regulation of Auditors’ with transatlantic perspectives on reform of the audit process. Specifically, they examine the role of the auditor, shareholder powerlessness and the post-Enron reform process in Canada and the UK, contrasting the reform movement in these countries with that in the US. Finally, the authors examine the developing auditor governance regime in the EU. In their analysis, the authors reach several important conclusions: the auditor-shareholder relationship and the duties of auditors to shareholders need to be clearly defined; shareholder isolation from the audit process severely endangers investor confidence; the independence of audit committees and auditors is not enough to protect shareholders; and, most importantly, shareholder voice should be recognised as an essential tool for promoting not only auditor independence, but also, ultimately, investor confidence. In short, the authors conclude that shareholder voice must be a part of the post-Enron reform of the audit process.

'Confidence and Competence: the Conundrum of EC Capital Markets Law' 4(1) Journal of Corporate Law Studies (2004) 1

This article considers the underlying rationales of EC securities regulation which, since the adoption of the 1999 Financial Services Action Plan, is fast emerging as a discrete and sophisticated regulatory regime for the EC capital market. In particular, it considers the regime’s growing reliance on the promotion of pan-EC investor confidence. EC securities regulation is placed in the context of the insights of behavioural economics which challenge the extent to which investor confidence is an appropriate objective for the new pan-EC regime. The powerful influences of the EC’s market construction imperative and its constitutional and institutional context, however, expand the role traditionally played by investor confidence beyond the strict regulatory context. Confidence may be an important device for deepening the Commission’s regulatory power and placing EC securities regulation on a more secure constitutional footing. A proposal is suggested for how investor confidence may be safely promoted by the new regime.

'Executive Remuneration in Europe: Convergence, Divergence and Reform' (with Professor Guido Ferrarini) in G Ferrarini, K Hopt, J Winter, and E Wymeersch (eds), Reforming Company and Takeover Law in Europe (Oxford University Press, 2004) 267

'New Frontiers in EC Capital Markets Law: From Market Construction to Market Regulation' 40 Common Market Law Review (2003) 809

'Investor Protection and the Treaty: an Uneasy Relationship' in G Ferrarini, K Hopt, and E Wymeersch (eds), Capital Markets in the Age of the Euro. Cross-border Transactions, Listed Companies and Regulation (Kluwer Law International, 2002) 17-61

'The Regulation of Investment Services in the Single Market: The Emergence of a New Regulatory Landscape' 3 European Business Organisations Law Review (2002) 293