The present article investigates the legal nature of the Basel Committee on Banking Supervision and seeks to identify the legal effects of the acts produced by the committee under public ...international law. It reassesses the most influential contemporary theories that have endeavoured to describe and capture the increasing trend towards 'de-formalization' of international law, of which the Basel Committee, with its peculiar composition and standard-setting activities, is generally considered as one of the most significant examples. The articles comes to the conclusion that the Basel Committee's normative outputs cannot be qualified as legal acts or legal facts under international law as they are best described as the results of flexible and informal standard-setting activities developed by domestic regulators at the international level, with a view to inducing compliance by national legislators and stakeholders. The lack of a formal 'pedigree' under international law has not undermined their effectiveness; on the contrary, it can be considered a peculiar feature of a successful model of transnational cooperation where soft law standards have been translated into domestic legislation.
The Basel Committee on Banking Supervision and the composite wider legal and institutional environment to which it is part provide a useful case study to illustrate how complexity is addressed in the ...public policy realm. As its central proposition, this article argues that it is possible to identify a specific pattern and logic underlying the governance of global banking today. The pattern concerns the institutional dimension of global banking regulation, particularly with respect to the distribution of regulatory powers among the various actors involved, and the legal relationships between these actors. The overall pattern seems to follow a certain logic, which will be explored and explained borrowing the military distinction between strategy, operations, and tactics.
The topic of this Special Issue of the Journal of International Economic Law is the Basel Committee on Banking Supervision (BCBS or Committee) and its place in international economic law and ...governance. Created in 1974, the Committee's single most important output is the Basel Accord, setting out capital requirements for banks. The first version of the Accord was concluded in 1988 ('Basel I'), now thirty years ago, and revised in 2004 ('Basel II'). A decade ago, the global financial crisis prompted further and deeper reforms to the Accord itself ('Basel III'), as well as relevant institutional changes both inside and outside the Committee.
This article explores the question of legitimacy that underpins Basel III. First, I present a general framework for assessing how legitimacy operates within the global financial system through an ...analysis of the internal and external dimensions. I next address the internal dimension, exploring the legitimacy of the Basel Committee on Banking Supervision (BCBS) as a body that exercises a type of public authority through the generation of norms/standards. I then analyse how the public law standards of transparency and accountability are currently being implemented within the BCBS system. Finally, I examine the external dimension, considering how the legitimacy of the BCBS is related to the international system. In particular, it is argued that because of the direct link between bailouts and human rights violations, the legitimacy of the BCBS is also tied to its role in promoting financial stability in the post-crisis architecture by protecting social rights within states.
Starting from the observation of an increased politicisation of the financial regulatory debate, the article analyse how this might impact the relationship between the European Union (EU) and the ...Basel Committee on Banking Supervision. The article first describes transnational financial networks after the global crisis and the shift from trust in technocratic autonomy to distrust and politicisation. It then turns to examine the legal bases for the participation of EU institutions in the Basel standard-setting process, discussing the challenges posed under EU law. The last part of the research focusses on the European Parliament’s attempts to become an active player in the transnational financial regulatory arena and on the role it might play to enhance the democratic legitimacy of the Basel process., Starting from the observation of an increased politicisation of the financial regulatory debate, the article analyse how this might impact the relationship between the European Union (EU) and the Basel Committee on Banking Supervision. The article first describes transnational financial networks after the global crisis and the shift from trust in technocratic autonomy to distrust and politicisation. It then turns to examine the legal bases for the participation of EU institutions in the Basel standard-setting process, discussing the challenges posed under EU law. The last part of the research focusses on the European Parliament's attempts to become an active player in the transnational financial regulatory arena and on the role it might play to enhance the democratic legitimacy of the Basel process.
Multilevel governance describes a global system that enrolls some State functions to perform global solutions for global problems. Multilevel-governance and multilevel administration has legality and ...accountability concerns on their own, although, there are multilevel structures with non-State playground of trans-regulatory nature at the supranational level of cooperation which means additional shades to the colourful palette.
The procedure and the structure concerning the creation and the evaluation of effective banking supervision standards in Europe is unique. Given the fact that the European administrative system is also unique, and as Basel rules are produced in a trans-regulatory network, the collaboration of the two 'sui generis' systems requires the rethinking of the classical legal order features. Rule of law which is the basis of classical international relations in the view of public administration of States is challenged by the newly emerged solutions. Necessity and proportionality are put on a scale with classical values and requirements of public administration and efficiency and effectiveness seem to put it on the side of the new type of collaboration.
The normative background of such structure is still immature. The multilevel administrative system of financial supervision including the European Union and the Basel Committee for Banking Supervision at supranational level or speaking in a wider context: the framework for multilevel governance with non-state actors at supranational level, is therefore an example for global administrative law of infant status.
In December 2010, the Basel Committee on Banking Supervision issued the text of the Basel III Framework, a series of global financial regulations that respond to the Great Recession, the financial ...crisis of 2007-2009. Basel III is the third iteration of the Basel Accords, which, along with the Basel Committee and its negotiation process, have been hailed as an exemplar of international regulation and law-making, but also critiqued as deeply flawed and subject to influence by the banks regulated by the agreement, among other issues.
This two-part project by Maziar Peihani investigates the Basel Committee's governance, operation and policies to determine the extent to which it has been legitimate. The first part studies the ...Committee's history and governance, and outlines the theoretical framework to assess its legitimacy.
This article seeks to provide a theoretical account of how management-based regulation (MBR), a new regulatory style used by many global regulators, affects its targets. The article centers on a case ...study. It introduces agencement theory as the theoretical heuristic to inform the analysis of a global, large-scale MBR scheme, the Basel Committee on Banking Supervision's Internal Capital Adequacy Assessment Program (ICAAP). In agencement theory, agency is understood in a neomaterialist frame. The core idea is that an actor's actions are determined by the material assemblage that constitutes her. The agencement heuristic allows ICAAP to be conceptualized as a regulatory agencement scheme. The scheme seeks to affect its targets—banks—by choreographing and shaping the socio-technical agencement processes under which the banks emerge as actors capable of cognizing and acting on risks. Consequently, the impact of MBR is mediated through actor construction. Regulation fosters actors whose socio-technical makeup leads them to have particular behavioral proclivities. The article also discusses the philosophical implications of moving to regulatory agencement and the schemes relationship to neoliberal regulation.
In January 2008, the Australian Prudential Regulation Authority introduced the second-generation capital requirement, Basel II, that substantially extended the 1988 Capital Accord of the Basel ...Committee on Banking Supervision. This paper explains the main features of Basel II; reviews concerns about the likely effects of the new capital requirement; and assesses the new capital requirement in the context of the global financial crisis.
