Transnational Fiduciary Law in Financial Intermediation: Are We There Yet? A Case Study in the Emergence of Transnational Legal Ordering

In most, if not all, mature financial jurisdictions, the provision of financial services has become the object of an increasingly complex body of regulation over the past few decades. Driven not least by initiatives of international standard-setters, the applicable regulatory frameworks have reached a level of convergence that, given residual differences in the applicable private law regimes governing the contractual relationships between intermediaries and their customers, is surprising. At the same time, courts (and, to some extent, national legislators) continue to struggle with the need to coordinate the applicable regulatory framework on the one hand and private law, including both contract and fiduciary law, on the other. Originating, at least to some extent, in common law principles of fiduciary law, the relevant standards for some time have made their way also into civil law jurisdictions. Financial services regulation thus presents an illustrative showcase for the emergence of a transnational legal order, in terms of the drivers for transnational consensus, the interplay between regulatory standards and private law, and the resistance of national actors against the incoming international framework. Focusing on conduct-of-business regulation for investment services, the present papers traces the origins of the process and examines its characteristics in the light of transnational legal theory.