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The increased demand and opportunity for cross-border trading activity has provided the opportunity to re-evaluate the appropriate regulatory approach to cross-border access. The regulation of cross-border products and services by securities firms has not kept pace with the growing globalisation and interwoveness of the securities markets. This has put pressure on regulators worldwide to come up with crossborder regulatory initiatives. From a regulatory perspective, various approaches of how to manage the regulatory tension have been proposed to accommodate the growing importance of rapidly growing markets and burgeoning cross-border trade and the decreasing importance of national borders in capital markets, while most regulatory infrastructures remain nationally based. A model that has gained increased interest is Mutual Recognition of securities regulation as a solution for effective regulation in the world of cross-border securities trade. The Mutual Recognition concept of the USA's Securities Exchange Committee (SEC), of which the discussion started in early 2007, is now gaining increased acceptance by the international community. With US investor demand for foreign securities exponentially increasing over the past few decades, the SEC is considerably expanding US investors' access to foreign markets and foreign securities intermediaries by developing a structure to mutually recognise foreign brokers-dealers and foreign exchanges. In March 2008, the SEC announced its plans to enter into formal Mutual Recognition discussions to explore initial agreements with a number of reliable foreign regulators in countries such as Australia, Canada and the EU. In their Joint Statement of 1st February, 2008, the SEC and the European Commission announced their will towards an integrated EUUS securities market by endorsing the Mutual Recognition of securities market law as the central approach. A transatlantic Mutual Recognition regime (framework) has the potential to realise the benefits associated with greater access of EU and US investors to broader and cheaper transatlantic market and international market intermediaries. Mutual Recognition could also simplify investors' ability on both sides of the Atlantic to greater diversify their market securities portfolio by broadening their investment choices and increasing their access to more information about foreign investment opportunities. In this paper the Mutual Recognition concept will be explained in more detail, including the mechanism, the framework, comparability process and the preconditions. Special focus is on the role of the Mutual Recognition approach as a way to create a transatlantic financial market. To what other topics, next to trading venues and intermediaries, can the scope of Mutual Recognition in the US-EU dialogue be enlarged? What does this concept mean for future regulatory cooperation and coordination? [ABSTRACT FROM AUTHOR]

International discussion is nowadays increasingly dominated by the credit crunch that is negatively impacting not only the financial markets, but also the global economy. Although this crisis can (justifiably) be blamed upon all parties involved (deal structurers, banks, investors, etc), a large part of the credit crisis has been blamed on the credit rating agencies (CRAs) that play a vital role in global securities and banking markets. The recent credit crunch and the resulting market turmoil have revealed a number of shortcomings with regard to CRAs' ratings of structured finance products - in particular, their credit rating process. CRAs are said to have been too positive on the risky financial products that were issued by US subprime lenders. Both investors and regulators in the USA and Europe have criticised the methods used by CRAs that led to upbeat assessments of investments, which turned out to be linked to risky home loans in the USA. CRAs have also been criticised for not alerting and/or being too slow to warn investors of the risks of buying US subprime-related products. Finally, CRAs are seen as having a conflict of interest, because they often provide advice to financial institutions on structuring, and also assess and rate their debt and structured products. This has forced both European and US regulators to review the present role and responsibility of CRAs. Some critics urge the need for reforms and are calling for heavier regulation on how CRAs rate structured finance products. Although there are still differences in opinion about future treatment of credit rating agencies, there is increasing consensus that it makes 'no sense' to regulate them on a much stricter basis. Existing financial services Directives applicable to CRAs and self-regulation by the CRAs on the basis of a strengthened International Organization of Securities Commissions (IOSCO) Code of Conduct, combined with market pressure and regulatory review, is seen as the most appropriate approach. [ABSTRACT FROM AUTHOR]