An esteemed panel of regulators, scholars, and lawyers gathered at Columbia Law School on March 29 to discuss Securities Market Issues for the 21st Century, a new e-book on the most important areas of inquiry for securities regulation and the financial markets. The book marks the culmination of the first phase in a multi-year New Special Study of the securities markets being conducted by the Program in the Law and Economics of Capital Markets, a joint initiative of Columbia Law School and Columbia Business School. The study is the first of its kind in more than five decades … Read more
Over the last three decades, U.S. and global securities markets have undergone tremendous change, driven by globalization, advances in information technology, and regulatory choices at the federal and international levels. The days of adventuresome floor trading and concerns of safeguarding ink-and-paper securities have given way to electronic order books within a multi-venue exchange system and to concerns about safeguarding interconnected global trade networks lead by SIFI’s. Artificial intelligence systems and distributed ledger technologies on the horizon have further potential to disrupt the landscape.
Markets today are dramatically different from those of 30 or 50 years ago, and a new comprehensive … Read more
The recent reversal of convictions of hedge fund managers Todd Newman and Anthony Chiasson highlights the weakness of using a common law approach when interpreting Rule 10b-5 to reach remote tippees accused of insider trading. The decision reinforces the need for a statutory approach to bar insider trading. A statutory approach is not a novel idea. Most jurisdictions around the world, including the UK and the other member states of the EU, have made insider trading a statutory offense that captures a wider range of conduct than does the US regime in its reliance upon Rule 10b-5. However, the introduction … Read more
In the wake of the 2008 crisis, it soon became apparent that the fault lines of the global financial system extended far beyond the regulated banking sector to the less regulated “shadow banking” sector. Nonbank financial entities including (but not limited to) money market funds, special purpose vehicles, insurance companies, and asset management firms, engaged in activities analogous to traditional bank deposit taking and lending, such as securities lending, repurchase agreements (“repos”), and securitization, yet were not subject to similar prudential regulations. Failures at these institutions, which led to cascading failures throughout the financial system, prompted financial regulators to reevaluate … Read more
The year 2013 is likely to be a watershed time in the development of shadow banking oversight and regulation. Of particular note are three upcoming developments: (1) the Financial Stability Board (the FSB) has commenced public consultations on its initial proposals and final recommendations are scheduled to be released in September 2013; (2) the USA will soon begin designating its first nonbank Systemically Important Financial Institutions (SIFIs), and will clarify its plans for regulating such entities in practice; and (3) the European Systemic Risk Board is preparing to recommend shadow banking oversight changes in early 2013. It is therefore an … Read more
In 2002, the UK began requiring an advisory shareholder vote on the annual executive and non-executive director compensation practices of UK-incorporated quoted companies (“UK Companies”). Eight years later, in July 2010, the US followed suit when President Obama signed into law the Dodd-Frank Wall Street Reform and Consumer Protection Act (the “Dodd-Frank Act”), providing for an advisory say-on-pay vote for most large US public companies.
The UK government has now gone one step further by proposing to reform the approval process for director remuneration, including through the introduction of a binding shareholder vote for all UK Companies that must occur … Read more