Empowering Investors: A Market Approach to Securities Regulation
This Article contends that the current legislative approach to securities regulation is mistaken. It advocates a market-oriented approach of competitive federalism that would expand the role of the states in securities regulation and would fundamentally reconceptualize the regulatory scheme. Under a system of competitive federalism for securities regulation, only one sovereign will have jurisdiction over all transactions in the securities of a corporation that involve the issuer or its agents and investors: the sovereign chosen by the issuer from among the federal government, the fifty states, or foreign nations. The aim is to replicate for the securities setting the benefits produced by state competition for corporate charters -- a responsive legal regime that has tended to maximize share value. As a competitive legal market supplants a monopolist federal agency in the fashioning of regulation, it will produce rules more aligned with the preferences of investors, whose decisions drive the capital market. Competitive federalism for U.S. securities regulation also has important implications for international securities regulation. The jurisdictional principle applicable to domestic securities transactions is equally applicable: Foreign issuers selling shares in the United States would be able to opt out of the federal securities laws and choose the law of another nation, such as their country of incorporation, or of a U.S. state, to govern those U.S. transactions.
When requesting a correction, please mention this item's handle: RePEc:ysm:somwrk:ysm74. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: ()
If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.
If references are entirely missing, you can add them using this form.
If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.
If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.
Please note that corrections may take a couple of weeks to filter through the various RePEc services.