EU committee is to supervise exchanges

A European Commission task-force yesterday proposed a powerful new committee to supervise the EU securities markets, but fell short of backing a "super-regulator" for the 15 member states, as some in Britain had feared.

A European Commission task-force yesterday proposed a powerful new committee to supervise the EU securities markets, but fell short of backing a "super-regulator" for the 15 member states, as some in Britain had feared.

A panel of "wise men" suggested that the committee, designed to coordinate the activities of the regulators in each member state and drive forward reform, should be up and running by 2002. The wise men were appointed to see whether there was a need for greater pan-European securities regulation to cope with demands for greater consolidation between European stock exchanges. The new EU Securities Committee, comprised of national representatives, would have extensive powers to update EU law on securities regulation.

The fact that yesterday's document confounded talk of the creation of a Europe-wide authority in Paris will be welcomed in the City, although there were suggestions that such a body may become necessary. Alexandre Lamfalussy, the panel chairman, said that if the committee did not prove effective, "it might be necessary to consider treaty change including the creation of a single European regulatory authority".

Sir Howard Davies, chairman of the Financial Services Authority, the City watchdog, has resisted calls from the French for a Federal super-regulator on the lines of America's Securities and Exchanges Commission, arguing that greater coordination between existing regulators would be enough.