BYU Law Review
Abstract
Historically, the financial markets of the United States and their corresponding regulatory scheme wielded unique influence throughout the globe. But this influence is waning, due largely to the centralization of financial services rulemaking within the European Union and the growth of global emerging markets. It is thus an important time to consider the circumstances under which a jurisdiction may assume and exercise the global regulatory influence traditionally wielded by the U.S. regime.
This Article develops a new framework to specifically address regulatory influence within global financial regulation and financial markets more broadly, looking beyond market size to establish a more complex understanding of the factors that influence global regulatory decisions within this area. This Article begins from the premise that existing theories of regulatory influence and regulatory competition, such as Anu Bradford’s “Brussels Effect,” are applicable to financial markets. This Article then sets forth novel factors regarding the jurisdiction adopting a given regulatory position that must also be considered.
This Article presents three illustrative case studies where the EU’s regulatory agenda has intersected with global financial regulation: (i) limitations on payment for the use of soft-dollar research; (ii) supervision of financial benchmarks following recent market manipulation scandals; and (iii) environmental, social, and governance (ESG) disclosures for financial products. These case studies introduce new principles for evaluating regulatory influence that have been lacking in the existing legal literature and that are of particular importance given the continuing growth of emerging markets worldwide.
Rights
© 2025 Brigham Young University Law Review
Recommended Citation
Jessica E. Lees,
Regulatory Influence in the Financial Markets Revisited,
50 BYU L. Rev.
1599
(2025).
Available at: https://digitalcommons.law.byu.edu/lawreview/vol50/iss6/7
