Local view for "http://purl.org/linkedpolitics/eu/plenary/2013-09-10-Speech-2-064-000"
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"en.20130910.10.2-064-000"2
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"Mr President, as ever I want to place on record my thanks to everyone: to my shadows; to you, Commissioner Barnier; to the Irish Presidency in particular; and to all our staff and experts who worked extremely hard to help me as rapporteur to deliver these new rules on market abuse, enabling us to vote today on a tougher and more comprehensive set of rules, which I believe will be fit for a fast-moving, high-tech financial world.
This week sees the fifth anniversary – on 15 September – of the collapse of Lehman Brothers, which triggered turmoil in the global financial markets. Some argue that the culture which caused the crisis persists in the financial world, particularly as instances of abuse continue to hit the headlines. These new rules on market abuse are therefore a cornerstone of the programme of financial reform and rehabilitation necessary to restore trust and confidence in the markets. They are essential to ensure that we tackle the problem of what one financial commentator has described as greed and finance getting the whip hand over judgment, prudence and probity.
In July 2012, the LIBOR (London Interbank Offered Rate) scandal was an illustration of greed and market manipulation of the worst kind: manipulation of the most crucial interest rate in global finance, which underpins around USD 350 trillion in derivatives and USD 10 trillion in loans. Regulators in the EU and London were caught unawares because the existing market abuse rules did not cover abuse of non-financial instruments and benchmarks. As a result, the imposition of large fines and the initial prosecution of the LIBOR scandal were carried out by the US regulator, the Commodity Futures Trading Commission (CFTC), with individual traders being called to prosecution in the US by the Department of Justice.
I believe the litmus test of our new market abuse rules will be whether we are able to use them to capture potential or emerging abuses and whether they are tough enough to be a deterrent and to sanction abusive practices. Surely none of us believes that the best way to serve justice in the EU is to extradite those who commit abuses to the US, where they face tougher sanctions and longer jail sentences?
So the rules we are voting on today not only close the LIBOR loophole, but also extend the scope of market abuse rules beyond financial instruments to benchmarks and indices. This is particularly relevant and important amid press rumours and speculation that we are now seeing manipulation in energy markets – in the oil and gas sector – as well as potential manipulation in foreign exchange markets.
These rules provide regulators with a range of tough tools, including more severe sanctions and penalties, a lifetime ban for those committing abuse, and essential protection for whistleblowers. They give regulators the tools they need to monitor, detect and prosecute market abuse, because we know that it is difficult to gather evidence of such abuse.
So, colleagues, I ask you to vote to support these rules. They tackle serious gaps in the regulation of new markets, platforms and over-the-counter trading in financial instruments; close the loopholes for LIBOR, benchmarks, commodities and commodity derivatives; remove obstacles to effective enforcement for regulators; and introduce legal certainty to ensure their effectiveness and ensure that all market abuse can be subject to criminal sanctions.
I am also pleased to report that, with these rules, we have taken the first step towards a system of cross-border surveillance. Given that regulators have informed us that in one case more than seven EU Member States were involved in information-gathering, I think this is a very important step forward.
Finally, today’s vote sends a clear signal to those intent on committing market abuse that the EU is not a soft option or a safe haven. In fact, we have broad public support for the new rules that we will introduce with today’s vote."@en1
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