The papers contained in this book were originally prepared for presentation at a Colloquium in Oxford in September 1995 organised by the Norton Rose M5 Group and they are of great value. The contributors are distinguished, and come from many different fields and from several countries. The papers discuss many of the different facets of the global financial markets. Thus they explain how a global offering can be achieved. Conflicts of laws problems are identified and discussed. The nature of rights arising from dealings in securities in the Euroclear and Cedel settlement systems are analyzed. Securitisation is explained. The regulation of the financial markets from the point of view of the United States, the United Kingdom and France is examined. The papers look to the future to see what progress is being made towards cooperation between regulators. The liability of dealers in derivatives is discussed.
These papers are very timely. In the last ten years or so there have been major changes. In 1986 Professor Tamar Frankel wrote:
The current developments show a multitude of practices in international trading. Large brokerage firms have developed their own around the clock trading techniques, while they simultaneously trade through stock exchanges and organisations or broker-dealers. In other words, there is no clear emerging pattern of trading or institutional organisation. Right now, anything and everything goes, so long as it works. Since we are at the beginning of the era of international securities markets, we may expect a period of experimentation and perhaps the emergence of a number of dominant patterns and institutions that will continue to develop side by side.1
The papers in this book show some of the progress that has been made in the last ten years. But the process of development is a continuing one in response to changing needs. One example may be given. In February 1995, Baring Brothers & Co. Ltd., a leading merchant bank, went into administration. The speed and manner of its collapse gave rise to much concern from the point of view of regulators of the banking and securities industries all over the world. This concern led in May 1995 to the Windsor Declaration, an agreement on cooperation in certain specific areas between regulators from sixteen different countries. This and other recent events may mark the beginning of a new era of cooperation on an international basis in the field of regulation of global financial markets. To use Professor Frankel's words, a new 'dominant pattern' may be emerging in this field of international cooperation in specific areas.
What the papers contained in this book cannot reflect is the lively debate that took place at the Colloquium itself. It was generally agreed that the global market only exists in the sense that the principal domestic markets co-operate with each other and that the diversity of legal and economic structures makes convergence difficult. Beyond that there was much debate: should there be more or less regulation?____________________