EACT highlights European Union's failure to consider real economic impact of financial regulatory proposals

The European Association of Corporate Treasurers (EACT) has sent an open letter to the Commissioners of the European Union, expressing grave concern over how, in its development of financial regulatory proposals, Brussels takes account of their impact on employment, growth and stability in the real economy. The letter has been signed by 188 European companies and its release follows that of a similar letter in January 2010.

The EACT's new letter to the Commissioners urges them to ensure that in the development of financial regulatory proposals there is a proper dialogue with the end-users of financial services and products. Whilst the EACT strongly supports the actions being taken to strengthen the oversight of the financial system, its experience is that inadequate attention is paid to a proper understanding of the inter-connectedness between financial regulation and the real economy.

Of immediate concern to the EACT is that proposals currently being made in Brussels for Directives and regulations over capital requirements in the banking sector (CRD IV and CRR) and financial instruments' markets (MiFID and MiFIR) threaten to reverse the economic value of the exemption granted to end-users of derivatives in the final version of the proposals (EMIR) now being confirmed by the European Union. Please click here to read the full press release (including comment from Richard Raeburn, EACT Chairman), and click View Document below to read the EACT's open letter to the Commissioners of the European Union, entitled "Financial Regulatory Policy: the need for dialogue with the real economy."