After long negotiations a compromise deal on new EU legislation to regulate trade in over-the-counter (OTC) derivatives and make the derivatives market safer and more transparent was struck by Parliament and Council representatives on Thursday. Derivatives trading is widely believed to have contributed to the global financial crisis.
Draft EU legislation to discourage insider trading and market manipulation was discussed for the first time in the Economic and Monetary Affairs Committee on Monday. MEPs focused on how best to define "insider information", ensure proper surveillance, encourage whistle blowers and punish offenders.
A Eurozone financial transaction tax would not only curb high-frequency and intermediary traders, but could even boost overall GDP, said financial experts at an Economic and Monetary Affairs Committee hearing on Monday. MEPs also reiterated their support for the idea, although some said that the Commission proposal needs more fine tuning.
The draft international agreement on enhanced economic governance lacks measures to promote growth and alone would not solve the crisis, the three EP representatives on the drafting group said on Thursday. The MEPs were nonetheless "cautiously optimistic" that some of their demands would be included in the final version of the text.
Stepping up supervision of credit rating agencies could help to eliminate their conflicts of interest, but obliging companies to "rotate" their use of them could actually reduce competition among agencies, argued experts at a public hearing held by the Economic and Monetary Affairs Committee on Monday and Tuesday.
The functioning of the European Finance and Stability Mechanism (EFSM) and the European Finance and Stability Fund (EFSF) will be debated by Economic and Monetary Affairs Committee MEPs and external experts on Monday from 15.30h to 16.30h and Tuesday from 17.30h to 18.30h. Speakers will include EFSF chief Klaus Regling.