Rating agencies are private companies that assess the risk of defaulting payment by debtors. As such, the rating of a borrower affects the value of the debt security it issued and that is to circulate in the markets. That is why the activity of credit rating agencies is critical to the security of financial instruments and the functioning of financial markets, but also to the whole global credit system. For instance, an AAA rating guarantees security to investors. Rating agencies helps building trust in financial markets and in the banking system. Henceforth, since everyone relies on them as they save people's time from seeking on their own information on securities or on those who issue them on the marks, international rating agencies have become crucial operators.
'Rating' has also become a business, which is now concentrated within the hands of three undertakings (two American and one French). It has often been said that these three are conflicted. Some have indeed brought up the fact as they have provided the markets with unreliable information (especially about subprime and securitization) prevented them to self-discipline, which eventually participated in the global spread of risks and defaults.
The difficult history between the rating agencies, whether they are considered as mere businesses, crucial operators or as companies undertaking a public service, which eventually led to implement a specific Regulation in the immediate aftermath of the financial crisis, shows how the information is a public common. This justifies the intervention of the Financial Regulator, namely to better protect the consumer. Should we go further on? Some have mentioned the idea of nationalizing the business and hand it over to Government institutions (or at least public ones). This is, however, no longer on the agenda, as many conflicts of interests may arise since rating agencies keep on rating the paradoxical debtors that States are.
Summary: By its judgment of September 24, 2020, the Constitutional Court of Belgium released an essential judgment which considers:
- Compliance Law which imposes obligations on entities to fight against money laundering and the financing of terrorism is legal requirements which must be analyzed on the basis of these goals
- the national transposition law is "broader" than the transposed European texts since it is anchored in the Constitution
- the provisions of the law imposing the declaration of suspicion on an employee of the Attorney or on a Compliance Officer concerning information covered by the professional secrecy of the Attorney, the basis of Democracy, must therefore be canceled.
This reasoning is remarkable and very solid.
It is not unique to Belgium.
On 2 March 2018, Koen Lenaerts came to an amphitheater at the University Panthéon-Assas (Paris 2) to inaugurate the series of conferences organized by the Journal of Regulation & Compliance (JoRC), a cycle that has the general title: Pour une Europe de la Compliance (For the Europe of Compliance). The School of Public Affairs of Sciences Po, the Department of Economics of Sciences Po, the Ecole doctorale de droit privé (Doctoral School of Private Law) at the Université Panthéon-Assas- Paris 2 (Panthéon-Assas University - Paris 2) and the School of Law of the University Panthéon-Sorbonne (Paris I), are associated with this cycle. Many personalities will take the floor. They will give contributions for the book that will be published in the Régulations & Compliance Series edited by Marie-Anne Frison-Roche at Éditions Dalloz.
After an admirable lecture offered by Koen Lenaerts, Antoine Garaponfootnote-94, secrétaire générale de l'Institut des Hautes Études pour la Justice (Secretary General of the Institute of Higher Studies for Justice), reacted perfectly in "premier discutant", stressing as everyone his great interest in listening to the demonstration made by the President of the Court of Justice.
He felt that it was hardly possible to speak of "Compliance Law"!footnote-91, because it is above all a Law that ceases to be "prescriptive" to become "relational" ", companies organizing themselves to put goals that are reached in relation with the public authorities. Companies thus develop a "systemic Law" that develops on its own, with alert mechanisms put in place directly by companies that care before the continuity of their economic activities. The notion of third parties disappears, a sort of "direct government" takes the place of the "indirect government" represented by the "third party", the companies having integrated this third party into their own organization, which upsets their relation to time and puts in place a "metajuridic" system.
Antoine Garapon then asks the question of how such a "conversion" could take place, that is to say, this transition of control systeme from the Ex Post mode to the Ex Ante, resulting in companies internalize the task of effective rules!footnote-92. He believes that on the one hand, the system that advocates it has the "market power to impose it and, on the other hand, those who demand it in this system make a" vision of the world "explicit. Antoine Garapon adds the need for a "moral ambition".
However, Antoine Garapon pointed out the United States have met these three conditions.
In his discussion, Antoine Garapon, on the other hand, felt that Europe did not bring them together and that Europe "starts with a handicap", because it does not consider worlwide, because it has no vision of the world, because it has not operated on moral integration.
He insisted that the Court of Justice can carry these three conditions, especially with regard to personal data. Because this is about the digital that Europe has a market power. It is about personal data that the Court of Justice is the place where Europe is both a market and values!footnote-93.
This is why the Court of Justice of the European Union does have a central role for this construction.
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These very constructed, very instructive remarks of Antoine Garapon, thanks to him, perfectly showed, in mirror of the conference of the President of the Court of Justice, the stake: the future.
Beyond the disputatio around the definitions, it is indeed the question of whether or not Europe will build its own compliance mechanisms.
By finding a vocabulary of its own. Not only in French, because the Law is made of words, but also with new words, which leave us "translated-glued" and which will carry European ambitions, as it was the case for the "right to be forgotten" ", very often quoted in the discussion.
Of course, this presupposes "power". But we must already pretend. And the Law has always claimed to pretend. It is in this that it is an Order. This is probably why President Koen Lenaerts insisted on the "juridicization" of compliance, as does the hand of Law that arises on an object.
Edouard de Lamaze, an Attorney at the Paris Bar, was successively a delegate to the Caisse Nationale des Barreaux français (CNBF), elected by the Paris Bar to be a member of the Union Nationale des Professions Libérales (...)
CAFAGGI, Fabrizio (ed.),Professor of Comparative Law, European University Institute, Italy.
Elgar Publisher, 2012, 400 p.
Globalization pushes the boundaries of markets. Alongside the greater
“goods” of transnational economic activity come the “bads” of unregulated
conduct. This important book looks to the new frontiers of legal intervention
to make sure that global markets do not run riot over important public values.
The signal contribution is not the search for ever higher levels of
transnational authority – the superstates of a brave new world – but empowering
numerous private actors to enforce legal norms in our fast-changing economic
environment.
Personal Data, as they are information, are Compliance Tools. They represent a precious resource for firms which must implement a vigilance plan in order to prevent corruption, money laundering or terrorism financing, for examples. It is the reason why personal data are the angular stone of "Compliance by design" systems. However, the use of these data cannot clear the firm of its simultaneous obligation to protect these same personal data, that is also a "monumental goal" of Compliance Law.
In order to be able to exploit these data in an objective of Compliance and protecting them in the same time, the digital firm Apple adopted for example new dispositions in order to the exploitation of the Identifier For Advertisers (IDFA) integrated in the iPad and in the iPhone and broadly used by targeted advertising firms, is conditioned to the consumer's consent.
Facebook reacted to this new disposition explaining that such measures will restrict the access to data for advertisers who will suffer from that. Facebook suspects Apple to block the access to advertisers in order to develop its own advertising tool. Facebook guaranteed to advertisers who work with it that it will not take similar measures and that it will always favor consultation before decision making in order to concile sometimes divergent interests.
We can sleep and already make some remarks:
GDPR imposing to companies that they guarantee a minimal level of protection for personal data does not apply in the United-States. It is then possible that Apple acted through Corporate Social Responsibility (CSR), more than through legal obligation.
The mode of regulation used here is the "conversational regulation" theorized by Julia Black. Indeed, regulators let the forces in presence discuss.
This "conversational regulation" does not seem to be very efficient in this case and an intervention of administrative authorities or of judges could be justified via Competition Law, Regulation Law or Compliance Law, knowing that Competition Law will favor access right to information and Regulation or Compliance Law private life right.
The whole paradox of Compliance Law rests in the equilibrium between circulation of information and secret.
