The Challenge of Integration of Regulation: Sub-sets of Financial Services

March 2018

Abstract

This article will look at the growth of regulation in the financial services industry in the EU. It will show how from fragmentation, there has been a move towards integration of EU financial services regulation. There are several sub-sectors in financial services and most commentators will analyse these sub-sets separately. This article is not seeking to conduct any such analysis; rather it will look at the general overview of how the regulation of financial services has evolved, relying on those common themes that emerge from the sector whilst recognising that in certain sub-sectors, regulatory activity has been more intense than in others. However whether one looks at general banking, capital markets, securities, insurance services, consumer services or others, the growth of integration and EU regulatory activity has followed a similar pattern, one that has seen domestic regulation exist in parallel with increased EU activity. Moloney et al, (2015) observe that this multidimensional regulation of financial services is a clear example of the multilevel governance which has conceptual challenges. Some of the challenges include the need to accommodate capital flows and supporting data and information across and between member-states. The EU and member-states have also had to figure out how to manage the different interactions between states and their regulators and between states and supranational regulators at EU level which Moloney et al (2015) argue make integration, harmonisation and convergence more desirable but yet more difficult. In this debate, one must also recognise that there are tensions too between state regulators as they each ascribe their own subjectivity to the application of EU law, an occurrence which materialises rather prominently in the data protection arena through the application of Directive 95/46/EC. It is accepted that there is inconsistency in how national regulators enforce data protection laws plus the general ineffectiveness of the WP29 when it sometimes fails to coordinate investigations and processes across the EU.

Author

Solomon Osagie

Chief Legal Counsel, TSYS International, UK

Dr Solomon Osagie is Chief Legal Counsel at TSYS International. He also has responsibility for data protection and regulatory compliance matters. A leading General Counsel ranked in the 2016 FT GC rankings, he was named in the Hot Lawyer rankings for 2016. In 2011 Dr Osagie was appointed to the Law Society’s Company Law Committee and he sits on advisory boards at a number of organisations like Acritas, GOAL, The Lawyer Financial Services Forum and the Brussels GC Advisory Board. In 2014, he was invited to join the Westminster Policy Forum on Legal Education and Training in the UK. Dr Osagie was a partner in private practice and then held senior roles in Industry. In 2016 he was invited to join the Lafferty Brexit Council, the International Cards & Payments Council and the International Retail Banking Council (IRBC). Before his appointment at TSYS International, Dr Osagie was Group General Counsel & Company Secretary at Global Switch. Solomon read law and international relations at Cambridge. He holds an MBA as well as a doctorate in management and law. He speaks and writes regularly about regulatory matters in the financial services sector and has been influential in the commentary on subjects like data protection and strategic management.

Company

TSYS International

TSYS® (NYSE: TSS) is a leading global payments provider, offering seamless, secure and innovative solutions across the payments spectrum — from issuer processing and merchant acquiring to prepaid program management . We succeed because we put people, and their needs, at the heart of every decision. It’s an approach we call ‘People-Centered Payments®’. Our headquarters are located in Columbus, Ga., U.S.A., with approximately 11,500 team members and local offices spread across 13 countries. TSYS generated revenue of $4.2 billion in 2016, while processing more than 25.5 billion transactions. We are a member of The Civic 50 and were named one of the 2017 World's Most Ethical Companies by Ethisphere magazine. TSYS is a member of the S&P 500 and routinely posts all important information on its website. For more, visit tsys.com.

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