“…there is a need for development of standards of comparison independent of the particular interests of competitors. Allowing special interest coalitions of onshore economies like the OECD to define the parameters of debate is thus particularly inappropriate.
There is a legitimate place for discussion of relative regulatory effectiveness in discussions of the global financial system. But it is critical that the discussion be in the context of the relative success of jurisdictions in achieving the goals of regulation, not the means they use to do so. As the UK’s 1998 review of financial regulation in the Crown dependencies noted, “[a]ll financial centres, onshore and offshore, have problems. All have their critics.”
The sooner the onshore/offshore distinction is abandoned and there is an even-handed approach to understanding different regulatory regimes, the sooner there will be improvements in both onshore and offshore regulatory efforts. It is important to remember that regulation of financial activity is not an end in itself, but merely a means to the end that is a system of vibrant world-wide financial markets that facilitate the creation of wealth.
Once that is recognized, the experience of the mature offshore financial centers may well hold lessons for how onshore regulators may improve their efforts to avoid the next Enron, Bear Stearns, Madoff, or Parmalat. Reorienting the discussion to focus on the best means for accomplishing the common goal of healthy financial markets is a necessary step.”
…..to read the full text of this timely and insightful article by Andrew P. Morris and Clifford C. Henson; and published in the Virginia Journal of International Law, CLICK HERE.