After the global financial crisis the European Union (EU) has reformed its financial services regulation, though the process is far from being completed. The EU is one of the largest jurisdictions worldwide, it is increasingly active in shaping global financial rules in international fora, and it is one of the main interlocutors of the US in the policy debate on this subject. This paper asks whether or to what extent, how and why the EU has promoted a ‘new’ paradigm for financial services regulation globally. In other words: has the EU developed its own distinctive ideas about financial regulation after the crisis and has it been successful in promoting them in international regulatory fora and/or in other jurisdictions?
In order to answer these questions, this paper first outlines the prevailing regulatory paradigm in the EU before and after the crisis, arguing that with a good dose of political opportunism, the EU has shifted from a market-making to a market-shaping approach. It then focuses in the interactions of the EU in the main international regulatory fora as well as the regulatory interaction with selected counterparts, first and foremost the US. As compared to the past, the EU seems to have been able to project a more coordinated (and hence more influential) position externally, albeit with notable exceptions, such as the Basel III accord. Finally, it teases out the main proponents of the ‘new’ EU regulatory paradigm, the main institutional constraints they face, and the interests at play. Theoretically, the paper uses the concept of regulatory paradigm, historical institutionalism and coalition building to inform the analysis.
