Lamfalussy process
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The Lamfalussy Process is an approach to the development of financial service industry regulations used by the European Union. Originally developed in March of 2001, it is named after the chair of the EU advisory committee that created it, Alexandre Lamfalussy. It is composed of four "levels," each focusing on a specific stage of the implementation of legislation.
At the first level, the European Parliament and Council of the European Union adopt a piece of legislation, establishing the core values of a law and building guidelines on its implementation. The law then progress to the second level, where sector-specific committees and regulators advise on technical details, then bring it a vote in front of member-state representatives. At the third level, national regulators work on coordinating new regulations with other nations. The fourth level involves compliance and enforcement of the new rules and laws.
The Lamfalussy Process provides several benefits over traditional lawmaking, including more-consistent interpretation, convergance in national supervisory practices, and a general boost in the quality of legislation on financial services. This has been demonstrated best in the development of the Markets in Financial Instruments Directive.
[edit] External links
- Assessment of the process by an association of finance professionals. [1]
- Discussion from the British Bankers Association. [2]
- Financial Services Authority (UK regulator)
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