Modelle des Verwaltungsverbunds in der Finanzmarktaufsicht

Abstract

Models of EU Administrative Federalism in the Area of Financial Market Supervision

The article analyses the development of the European financial architecture from 1993 to 2013, i.e. from the beginning of the internal market for financial services to the Single Supervisory Mechanism (SSM). It builds on the thesis that organizational decisions in the area of public administration are mainly driven by three factors: policy objectives, constitutional restraints, and available resources including staff and finances. In the European Union, the legislator initially pursued the idea of completing the internal market on the basis of the concepts of mutual recognition and minimum harmonization. The Member States implemented the applicable secondary law and supervised the financial institutes according to the home country model with minor forms of cross-border administrative cooperation. Yet, two different regimes existed for the supervision of the provision of services and the establishment of branches by a financial institution on the one hand, and for consolidated supervision of internationally operating groups on the other hand. The inefficiencies of this administrative model surfaced in the wake of the financial crisis from 2007 to 2009. As a consequence, the European legislator decided to reform the decentralized model of supervision and in 2010 introduced a new administrative layer of European supervisory authorities (ESAs). In addition, the supervisory objectives were complemented by a new instrument, macroprudential supervision, which aims at identifying and preventing systemic risks. From the point of view of EU constitutional law, the new system was a considerable step forward in the development of a genuine European administration. However, issues of legislative competence and of the principle of institutional balance were still not fully settled. Only two years later, the ongoing debt crisis in Europe led to a fundamentally new assessment of this supervisory system. With a view to severing the linkages between ailing banks and strained public budgets, the European Council decided to establish the SSM. Under the SSM regulation, the ECB is directly responsible for significant banks whereas the less significant banks are still supervised by the national competent authorities. This is, so far, the most radical reform in public administration in the Euro area in recent years. It reduces considerably the extent of the decentralized model, streamlines supervisory practices, and bypasses the constitutional constraints which apply to the ESAs.