This article gives an overview of the efforts, worldwide and on a regional, that is, European, basis for introducing more effective and better harmonised financial regulation. Recent initiatives, especially the work of the G20 and the creation of the Financial Stability Board (FSB), indicate greater interest in worldwide coordination of financial regulatory intervention. The financial crisis has however dealt a serious blow to the previously existing international dialogue, and a fear exists that the main regulators may withdraw to their national battlefields. Major changes in the supervisory architecture are planned in the European Union: a more detailed coordinated app-roach to regulation and to monitoring the application of existing regulations is proposed by creating a European System of Financial Supervisors. A European Systemic Risk Board will also be introduced. These and comparable changes in the US may contribute to reactivating the regulatory dialogue. The core challenge remains that of effective application of the agreements, both at the regional and the international level, and there is no ready answer to this.
International and local regulation should be coordinated.
Regulators should coordinate better, as markets are international, and regulatory arbitrage may undermine effectiveness.
Macro and micro supervision have to be integrated without losing their specificity.
The present cooperation mechanisms have been conceived for fair weather.
Adequate instruments have to be developed to deal with a financial crisis, at both regional and international levels.