By- Sibani Saxena (Roll no. 689)
Topic: REGULATION OF STOCK MARKETS IN FRANCE
France's status as the fourth largest financial market in the world renders crucial its participation in the international effort to globalize securities markets and harmonize securities regulations. France attained this prominence in the 1980s, by transforming its Bourse from one of the most highly regulated markets in Europe to one of the most deregulated.
This liberalization occurred in response to both the imminence of the single European market and the need for France to increase its competitiveness in the international financial arena.-
As France liberalized its markets, it initially failed to institute sufficient "prudential reregulation to keep pace with its "access deregulation."
Thus, France's securities markets lacked the necessary investor protection and became more accessible and desirable only to those investors who did not fear the "dirty dealing" traditionally tolerated by the French government. This wrongdoing, specifically insider trading and market manipulation, might have continued if France had not been subjected to the scrutiny of other, less tolerant countries caused by the growing number of cross-border transactions.
In particular, foreigners became "suspicious of intrigue" after the occurrence, in late 1988, of two internationally publicized scandals that implicated the French Government.'
The public concern surrounding these scandals forced France to adjust its policies in order to gain credibility." France's "reregulation" followed the example set by Great Britain in 1986, when the British government instituted the Financial Services Act.12 However, France has not attempted to protect its investors by adopting a statutory scheme of securities regulation.
Instead, the French government increased the regulatory authority...