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Centre for Financial and Management Studies (CeFiMS)

Regulation of International Capital Markets

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This course has been specially designed for postgraduates studying finance and financial law and does not assume that you have previously studied financial regulation. It is designed to contribute to your enhanced understanding of the ways in which governments and public authorities intervene in the operation of financial markets.

The course focuses on the principles of regulation of international financial markets and examines the public regulation of financial markets - that is, the relationship between central government, independent government agencies or indeed international organisations on the one hand, and financial markets or market participants on the other.

The course is premised upon the notion that the students of finance and financial law ought to develop a sound understanding of the various choices available to policy makers and national supervisory authorities in relation to the design and structure of national regulatory frameworks. The course will provide a critical view of current regulatory developments with the aim to identify the most appropriate regulatory policies towards increasingly complex financial phenomena and markets.


Study Guide

You will receive a looseleaf binder containing eight 'course units'. The units are carefully structured to provide the main teaching, defining and exploring the main concepts and issues, locating these within current debate and introducing and linking the further assigned readings. The unit files are also available to download from the Online Study Centre.


There is no single textbook that accompanies this course. Instead, a compilation of readings: recently published articles or seminal writings, is provided.

Online Study Centre

You will have access to the OSC, which is a web-accessed learning environment. Via the OSC, you can communicate with your assigned academic tutor, administrators and other students on the course using discussion forums. The OSC also provides access to the course Study Guide and assignments, as well as a selection of electronic journals available on the University of London Online Library.

Objectives and learning outcomes of the course

When you have completed your study of this course, you will be able to:

  • Outline and discuss the main reasons for government intervention in financial markets
  • Analyse the inherent weakness of the financial system and explain the role of law in correcting those deficiencies
  • Explain the reasons for and techniques of banking regulation and supervision
  • Examine and discuss the importance of capital regulation for the stability of the banking system
  • Outline and discuss the methods and instruments of securities regulation in a range of issues, including Initial Public Offerings, financial intermediaries, securities trading, fraudulent practices and takeovers
  • Critically assess the regulatory components of the global financial system
  • Analyse the legal components of current work towards a stronger global financial system following a recent sequence of devastating crises in Asia, Latin America and elsewhere.

Scope and syllabus

Course Content
Unit 1: Introduction to Financial Regulation
  • 1.1 Introduction
  • 1.2 The Concepts of Regulation and Supervision
  • 1.3 Instruments of Regulation
  • 1.4 Who Regulates: Institutions and Structures
  • 1.5 Methods of Regulatory Enforcement
  • 1.6 Financial Regulation: An Introduction
  • 1.7 Concluding Remarks
Unit 2: Central Banking and Banking Regulation
  • 2.1 Introduction
  • 2.2 Forms and Instruments of Financial Regulation
  • 2.3 The Organisational Structure of Financial Regulation
  • 2.4 The Nature of Banking Risks
  • 2.5 Why Regulate the Banking System
  • 2.6 The Role and Functions of the Central Bank
  • 2.7 The Failure of Northern Rock - A Case Study
  • 2.8 Concluding Remarks
Unit 3: Introduction to International Capital Markets
  • 3.1 Introduction
  • 3.2 Financial Markets and Financial Assets
  • 3.3 Primary and Secondary Capital Markets
  • 3.4 The Internationalisation of Capital Markets
  • 3.5 The Globalisation of Financial Crises
  • 3.6 Conclusions
Unit 4: Regulation of Primary Securities Markets in the United States
  • 4.1 Introduction
  • 4.2 Introduction to Primary Securities Markets
  • 4.3 Overview of the Regulatory Framework
  • 4.4 Mandatory Disclosure and the Efficient Capital Market Hypothesis
  • 4.5 Regulation of Primary Securities Offerings in the United States
  • 4.6 Conclusions
Unit 5: Financial Integration and Regulation of Primary Securities Markets in the European Union
  • 5.1 Introduction to International Financial Integration
  • 5.2 EU Policies and Institutional Mechanisms of Financial Integration
  • 5.3 The Financial Services Action Plan
  • 5.4 The Core EU Measures Regulating the Primary Market
  • 5.5 Conclusions
Unit 6: International Regulation of Securities Firms
  • 6.1 The Role of Market Intermediaries in Securities Markets
  • 6.2 Regulation of Securities Firms - an Introduction
  • 6.3 Federal Regulation of Securities Firms in the United States
  • 6.4 Regulation of Securities Firms in the United Kingdom
  • 6.5 International Aspects of Regulation of Securities Firms in Europe
  • 6.6 Conclusions
Unit 7: International Regulation of Secondary Securities Markets
  • 7.1 The Structure and Economic Functions of Secondary Securities Markets
  • 7.2 The Economic Rationale for Regulating Secondary Securities Markets
  • 7.3 Market Regulation in the United States
  • 7.4 Market Regulation in the European Union - The Market Abuse and Transparency Directives
  • 7.5 Market Regulation in the United Kingdom
  • 7.6 Conclusions
Unit 8: Global Capital Markets and Development of International Rules
  • 8.1 The Globalisation of Finance
  • 8.2 Building International Financial Stability
  • 8.3 Developing International Rules and Regulatory Standards for Capital Markets
  • 8.4 Financial Regulation in the European Union in the Aftermath of the 2008 Financial Crisis
  • 8.5 Fighting International Financial Crime
  • 8.6 Conclusions

Method of assessment

You will complete two assignments, which will be marked by your course tutor. Assignments are each worth 15% of your total mark. You will be expected to submit your first assignment by the Tuesday of Week 5, and the second assignment at the end of the course, on the Tuesday after Week 8. Assignments are submitted and feedback given online. In addition, queries and problems can be answered through the Online Study Centre. You will also sit a three-hour examination on a specified date in October, worth 70% of your total mark. An up-to-date timetable of examinations is published in April of each year.