A Current Assessment of Some Extraterritorial Impacts of the Dodd-Frank Act with Special Focus on the Volcker Rule and Derivatives Regulation

Authors

Lawrence G. Baxter, Duke Law SchoolFollow

Document Type

Article

Publication Date

2012

Keywords

Volcker Rule, Dodd-Frank Wall Street Reform Act, financial markets, financial reform, systemic risk, derivatives, financial industry, Basel Committee on Banking Supervision, Financial Stability Board

Abstract

As the world struggles to emerge from the Global Financial Crisis the vision of a harmonious framework of global financial regulation seems as distant as ever. Important progress made by international committees such as the Basel Committee on Banking Supervision and the Financial Stability Board notwithstanding, there seem to be increasing signs of unilateral, extraterritorial action by major jurisdictions, including the United States. This paper reviews the framework created by the US financial reforms, in particular anti money laundering provisions, the Volcker Rule and the proposed OTC derivatives margin requirements, and considers some of the dilemmas presented by modern global banking and its concomitant regulation. The conclusion is that we are likely to see more regional reforms that are not necessarily uniform, and that this might not be a bad result, given the complexity of the financial markets and the need to respond flexibly to evolving circumstances.

Citation

Lawrence G. Baxter, A Current Assessment of Some Extraterritorial Impacts of the Dodd-Frank Act with Special Focus on the Volcker Rule and Derivatives Regulation, 5 Korean Journal of Banking & Financial Law 3-28 (2012)