Working Paper Series
The Working Paper Series, launched in May 1999, aims at promoting the dissemination of the research results of different researchers within the Financial Law Institute to the broader academic community.
A full list of Working Papers published up to now is reproduced on this page. Each Working Paper is available in full text in Acrobat-format. The use and further distribution of the Working Papers is allowed for scientific purposes only. Working Papers are published in their original language (Dutch, French, English or German) and are provisional.
Current Year
| WP 2012-01 | Michiel De Muynck : Precontractuele bijstand ex. artikel 11, §4 W.C.K. Katalysator voor een herijkt beslissings- en toezichtsmodel inzake consumentenkrediet? |
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Deze bijdrage gaat nader in op de precontractuele informatie- en adviesverplichtingen uit de Wet Consumentenkrediet en meer in het bijzonder de plicht voor de kredietgever, respectievelijk de kredietbemiddelaar, tot het verstrekken van passende toelichting. |
| WP 2012-02 | Michiel De Muynck, Jonneke van Poelgeest : Het aanbieden van consumentenkrediet na Richtlijn 2008/48 EG: de Nederlandse en Belgische regelgeving aan elkaar getoetst. |
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This paper (in Dutch) discusses some requirements that govern the provision of Consumer Credit in the Netherlands and Belgium and the harmonization of laws through Directive 2008/48 EC. |
| WP 2012-03 | Eddy Wymeersch : Regulation and Case law relating to Financial Derivatives |
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The widespread use of derivatives has created considerable new risks, especially of a systemic nature. To reduce risks regulators hare mandating the use of central counterparties, of trade repositories and of regulated trading facilities. The paper gives a short overview of pending European proposals. It also deals with the court decisions that have been rendered in relating to derivatives, or structured products in several European jurisdictions, especially opposing local authorities and private investors to banks. |
| WP 2012-04 | Eddy Wymeersch : Risk in financial institutions : is it Managed? |
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Adequate Risk management has become the central pre-occupation of financial regulators, central banks, and banks as well. Awareness about the risk issue has increased considerably, partly spontaneously, partly under the pressure of new regulations, esp. the Basel III standards. Risk measurement, risk appetite is a management tool, a process and a learning curve, more than a fixed formula. Risk inspired restrictive measures abound, but may overly reduce the credit flow to the economies, making it difficult to strike the right balance between risk stability and liquidity provision. The Basel II CRD IV call special attention to risk management by introducing some very clear cut rules, leaving the traditional comply and explain approach to a stricter supervisory intervention. Should a bank adopt its behavior if this may potentially trigger macro-risk? What is the role of the auditors and of the shareholders dealing-opposing strict risk management. More work has to be undertaken, but banks obviously are investing considerably in better risk controls. |
| WP 2012-05 | Eddy Wymeersch : A New look at the Debate about the Takeover Directive |
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With a view of the projected revision of the takeover directive, this paper calls attention to some items that would usefully be revised. Especially attention is drawn to the mandatory bid rule, the scope of which should restricted to share acquisitions %u2013 and not apply to other control changes, while company law in general should strictly regulate conflicted transactions, thereby eliminating control premia, and hence the need to proceed to a mandatory bid. Multistate takeover should be reregulated, taking into account the new supervisory structure, esp. ESMA. Also some of the blanks should be filled e.g. on squeeze outs, sell outs, and other specific requirements like acting in concert. As to the most controversial item of defensive techniques, a fundamental revision seems unlikely, but one could be considered to allow these techniques, but subject their effectiveness to a qualified vote in the general meeting, the shareholders voting according to the rules applicable before the bid. |
Last Year
| S&C 2011-01 | Eddy Wymeersch : IAS - Some Longer Term Views on IFRS |
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The IFRS have been an impressive success story being applied by about 2/3rds of the world. Essentially the US remains outside, at least until further notice as the SEC is planning to make a new move in 2011, while "marking to market" has been announced to be open for a more flexible reading. The main objective will be to keep the IFRS truly worldwide, what is a valuable public good, but may be difficult to achieve. There is a risk of differences in rulemaking, in interpretation and in application. Strong monitoring will be needed to keep the IFRS identical all over the world. National differences in accounting rules and interpretation may be due to different needs: shareholder v. creditor protection. This divide also characterizes several company law provisions, and should be overcome. |
| S&C 2011-02 | Eddy Wymeersch : Het algemeen belang als doelstelling van de auditfunctie en van het auditberoep |
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Het beroep van auditor is opnieuw het voorwerp van aandacht van wet- en regelgevers. Opvallend is de aansluiting bij het algemeen belang dat tot uiting komt zowel in het Green Paper van de Europese Commissie, als in de ontwikkeling van de auditnormen door IFAC, zoals deze worden overzien door de PIOB. Enkele aspecten van de Green paper worden kort ontleed: de concentratie problematiek en de toezichtorganisatie. Verder wordt de PIOB voorgesteld. |
| WP 2011-01 | Eddy Wymeersch : Europe's New Financial Supervisory Bodies |
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This short paper gives an overview of some of the basic features of the new supervisory landscape that was introduced in Europe starting from 2011. Are mentioned, the relationship between local supervision and centralised rulemaking, the relationship of the new European authorities with the national supervisors and their position in the overall EU regulatory structure, their internal organisation and finally the powers that have been conferred on these new bodies. |
| WP 2011-02 | Reinhard Steennot, Michiel De Muynck : Reclame en precontractuele informatie onder de wet consumentenkrediet anno 2011 |
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Op 1 december 2010 is de gewijzigde Wet Consumentenkrediet in werking getreden. De wijziging van de Wet Consumentenkrediet is het gevolg van de omzetting van de Richtlijn Consumentenkrediet. In deze bijdrage zullen wij aandacht besteden aan de regelen inzake reclame en de precontractuele informatieverplichtingen die in de algemene bepalingen van de Wet Consumentenkrediet vervat liggen. Wij beperken ons daarbij niet tot een beschrijving van de (nieuwe) bepalingen, doch geven tevens aan of de (nieuwe) regelen verenigbaar zijn met de Europese Richtlijn. De Richtlijn is immers gebaseerd op het principe van gerichte volledige harmonisatie, zodat op enkele punten de vraag rijst of de wetgever de bescherming, zoals deze vervat lag in de wet van 1991, zoals gewijzigd in 2003, wel kon behouden. Bij dit alles verliezen wij ook de Wet Marktpraktijken niet uit het oog. |
| WP 2011-03 | Hans De Wulf : Aandeelhoudersvorderingen met het oog op schadevergoeding, of waarom elke aandeelhouder vergoeding van reflexschade kan vorderen, Belgie class actions moet invoeren en de minderheidsvordering moet hervormen |
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This article, written for a volume celebrating the 10th anniversary of the 2001 New Codification of Belgian Company Law, contains a critical discussion of the Belgian legal rules concerning shareholders' suits in which shareholders of a corporation claim damages because their shares dropped in value as a result of negligence or another breach of duty by a third party. The article deals with direct suits because of reflective damage, with derivative actions and with securities class actions. It argues that traditional judge-made rules barring shareholders from bringing suit when the drop in share value they experience constitutes "reflective loss" because the drop reflects damage to the corporation that issued the shares, are incompatible with a correct application of art. 1382 Belgian Civil Code (the general rule of liability for negligence). Nevertheless, I acknowlegde that policy objections can be raised against the dogmatically correct rule that shareholders have an individual right of direct action as soon as their damage is certain because it is certain that the corporation itsel will not claim damages from the tortfeasor. To counter the double jeopardy problems caused by direct shareholder suits without robbing shareholders of legal remedies, I suggest reforming the rules on derivative actions. I propose to abolish the threshold of 1% of voting rights for bringing a derivative action, as well as the rule banning derivative actions against others than board members. The rules on the allocation of legal costs should be reformed to alleviate the massive free rider problem under current law. Finally, I give arguments supporting recent proposals to introduce some form of class actions in Belgium. At the same time, I suggest that separate rules for securities class actions should be introduced. Because of the so-called "circularity problem" and rules largely shielding directors and especially officers from personal liability , it is likely (as the American experience shows) that neither the compensatory nor the deterrent effect of securities class actions would be very large. Tailor-made rules are therefore needed, but I even suggest that if the Belgian legislator introduces class actions, he may consider excluding securities class actions, or securities class actions with the corporation as a (co-)defendant. |
| WP 2011-04 | Reinhard Steennot : Toepassingsgebied van de Wet Consumentenkrediet |
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| WP 2011-05 | Reinhard Steennot : De nieuwe Wet Marktpraktijken |
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| WP 2011-06 | Reinhard Steennot : Protecting borrowers through information and advice: the Belgian Consumer Credit Act |
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The Consumer Credit Directive requires the creditor or the credit intermediary on the one hand to provide certain information and adequate explanations to consumers before they are bound by a consumer credit agreement and on the other hand to assess the consumer%u2019s creditworthiness before the conclusion of the credit agreement. The aim of this paper is to discuss the transposition of the European Consumer Credit Directive into Belgian legislation. We will analyze the pre-contractual obligations %u2013 and their sanctions in case of violation - as applied by the courts/in legal practice. Also, we will examine whether the Belgian Act is compatible with the Consumer Credit Directive, the latter being based on the principle of targeted full harmonization. |
| WP 2011-07 | Elke Vandendriessche : Fraud-on-the-market: een causaliteitstheorie inzake beleggersverliezen |
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The possibility to obtain compensation for investor losses has gained substantial importance and attention in recent years, since capital markets across Europe have increasingly attracted smaller investors who have substituted traditional savings products offered by the banks for more risk-bearing financial products traded on financial markets. As a consequence of the internet-bubble at the end of the 1990s and recently the worldwide financial crisis in 2008-09, many investors suffered considerable investment losses, causing legal practice to consider whether and to what extent investor losses can be recovered from financial institutions, intermediaries, issuers and other market participants. Reported case law however shows that investors are struggling to obtain compensation for their claims. One of the problems they find themselves confronted with is the burden of proof regarding the requirement of causation between the alleged wrongful and the damages they claim. In this paper, the requirement of causation, as it is interpreted and applied in the Belgian courts, is analyzed with respect to investor suits following misstatements to the market. Based on the case law analysis, the paper shows that the courts do not deal with the requirement of causation in a very consistent and uniform manner. An alternative concept to deal with the causation requirement is analyzed, drawing comparisons with US securities fraud cases, and particularly with the fraud on the market-theory. |
| WP 2011-08 | Michiel De Muynck : Credit cards, overdraft facilities and European consumer protection. A blank cheque for unfairness? |
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This contribution takes a close look at overdraft facilities, the most eccentric type of credit under the scope of Directive 2008/48 EC on credit agreements for consumers. Even in the absence of a %u2018smoking gun%u2019 linking consumer credit to personal insolvency, the tacit nature of this type of credit represents a significant %u201Cspiral of debts%u201D risk. Armed with some overdraft facility basics we provide several theoretical insights on imperfect markets for consumer finance and consumer (un)awareness and biases when contracting for money. Today%u2019s information requirements only partly capture the reality of Homo sapiens kind of borrowers. European consumer protection ought to safeguard consumers from behavior diverging from (perfect) rationality. It should therefore abandon narrow legal reasoning and include ethical, economical and social norms. In an attempt to reach a substantial information equilibrium we call for multi-layered and intelligent credit regulation incorporating aforementioned behavioral evidence. While such rules might be better aligned with product legislation, new IT solutions pave the way for targeted point of sale disclosure and tailored monthly statements. A strict regulatory dichotomy between regulation with regard to a consumer%u2019s assets (e.g. investor protection) and debts (e.g. consumer credit) seems superseded. The last part of our contribution shines a light on the evolved Belgian approach with regard to overdraft facilities, foreclosing an unlimited freedom of the market for price setting. |
| WP 2011-09 | Eddy Wymeersch : The regulatory regime of Exchange traded funds in the European Union |
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Exchange traded funds have become an essential part of our financial landscape: they stand globally for $ 1,3 billion assets, 2% of listed securities and 5% of all investment funds, and constitute also for the retail investor an attractive alternative to the traditionally managed funds. Their legal regime needs further analysis especially also due to the multiple forms they can adopt, and the innovations in the regulation of investment funds. The different hypotheses are analysis, including the application of the new regime under the Alternative Investment Funds directive. Systemic issues may receive a new answer on the basis of this directive. |