Cicero Policy Briefer

Issue 17, October 2007

Charlie McCreevy: make the most of him

By Iain Anderson

With a little less than two years before Charlie McCreevy is set to step down as Internal Market Commissioner, there is an opportunity to continue to drive forward his lighter touch regulatory agenda.

From the very start of his tenure, McCreevy made it clear that his first priority would be to ensure that existing EU legislation was being properly implemented in the first place, rather than simply allowing Brussels bureaucracy to continue its legal juggernaut.

This approach—especially around the digestibility of the centrepiece of financial markets reform, the Financial Services Action Plan—has been highly desirable, but there are signs that the pressure is growing to put the legal juggernaut into top gear once again.

Parliamentary pressure is growing in both home member states and in the European Parliament itself to put in place more consumer protection powers. Much of the policy momentum for this has been fuelled by the global credit crunch we have witnessed this summer. Before the end of the year we can expect the Commission to publish its long awaited Mortgage Credit White Paper, and EU policy wonks will be watching closely to see if the McCreevy light touch approach continues to win out or whether the US sub-prime impact has forced the Commission to take a more interventionist approach.

There is also another major challenge for McCreevy imminently on the horizon, with the majority of nation states still to transpose the MiFID directive fully into their own legislation. Will McCreevy remain 'light touch' on this one? Unlikely!

Equally the private equity debate rages as strongly in the European Parliament as it does anywhere, and as national governments are beginning to take action, but so far McCreevy has indicated he does not believe there is a need for more legislation in this area.

There is one prize which many in Brussels would like to get back onto the agenda and which McCreevy has steadfastly opposed: the creation of an EU financial services super regulator. Under McCreevy's watch this is likely to remain a pipe dream, but I hear continuing talk of such an initiative and I predict this might be one of the initiatives which is placed into the intray of his successor.

McCreevy has been good news for markets: continue to make the most of it, as it may not last.

Iain Anderson can be contacted on +44 (0)20 7665 9532 or click here to email.

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