Message

Dear Stephane,

Further to your yesterday email, i attach a number of documents with a little background as follows.

In the last year or so there has been industry activity on a number of fronts in the area of cross border regulatory convergence.

At the global level, the Institute of International Finance (IIF) is actively engaged with IOSCO on regulatory convergence. A number of securities firms drafted papers, which are also relevant to the EU US dialogue, and which have been sent to IOSCO and are attached, namely

a. Framework paper on regulatory convergence setting out the options for exemption, recognition and standardisation.

b. Achieving direct cross-border institutional access for capital market market intermediaries

c. Convergence of investor categorisation regimes

d. Standardising rules on the disclosure of shareholdings with country matrices

Additional papers on standardisation of transaction reporting requirements and of stabilisation rules are being prepared

In the US, SIFMA is enagaged with the SEC on pushing for a reform of SEC rule 15a6 regarding exemptions for non-US broker dealers. SIFMA's paper to the SEC is also attached.

At an EU-US dialogue level, the EU-US coalition is engaged with the SEC, the EU Commission and national regulators on pushing for modernisation of transatlantic cross-border regulation, including via exemption, mutual recognition, and standardisation. The report will be issued shortly. I have attached the final draft.

In Europe, we formed last September an EU Cross-Border Securities Working Group so as to coordinate all of this from an EU point of view and ensure global coherence in the industry message. The Working Group brings together EU and global securities firms and trade associations, as well as the EU-US Coalition, into a single group to coordinate the securities industry position on regulation of global and transatlantic capital markets and to develop a coherent industry message towards policy makers. I provide the secretariat to this Working Group.

One of the outputs of this group is a memo from Clifford Chance, also attached, presenting the case for an exemptive regime in Europe. This memo is the outcome of a meeting with EU General Counsels of bank members of the Working group and Commissioner McCreevy and david Wright last November where the EC expressed an interest in exemption but wanted to know more and also raised concerns regaing its impact on the integrity of the EU Single Market.

I hope this is helpful. Our presentation will be sent nearer the time.

Best regards and bon w-e!

Bertrand Huet