Ministers to push for securities regulations

Finance ministers sceptical about the European Commission’s carrot-and-stick approach to opening up competition in the securities sector may try to push for a stricter regulatory approach at next week’s Ecofin meeting (10 October).

Industry representatives, working with the Commission on a voluntary code-of-conduct aimed at linking up the stock exchanges, clearing houses and settlement firms operating in national markets, are worried that contributions from member states on the matter will complicate affairs or, at worst, derail their plans which are supposed to be introduced at the end of this month (31 October).

France, which is known for its pro-regulatory stance, could attempt to throw a spanner in the works in a bid to push for legislation. "We think there is a need for regulation of post-market activities because securities and exchange markets work broadly at a European level now and there is movement between them," said a French diplomat.

A Finnish source said of the French: "They have issues and they will express these orally. They would be keen to bring legal solutions into being."

Judith Hardt, secretary-general of the Federation of European Securities Exchanges, expressed worries that member states’ contributions could complicate what is essentially an industry-led initiative. "If you load the boat too much, it might just sink," she said.

"Industry is still negotiating with the Commission. It is a very laborious process involving the associations representing the exchanges, clearing houses and central security depositories. The list of what we are expected to deliver is getting longer and longer as time goes on."

Germany will be backing the Commission’s plans for a voluntary code. Stricter measures would strike at the heart of national exchange Deutsche Börse’s so-called vertical silo system, splitting up trading, clearing and settlement services.

Finance ministers sceptical about the European Commission’s carrot-and-stick approach to opening up competition in the securities sector may try to push for a stricter regulatory approach at next week’s Ecofin meeting (10 October).