Retail payments: a changing European landscape

The landscape for retail payments in Europe is going through a period of considerable upheaval due to technological developments and entry by new providers, supported by regulatory changes. What exactly are these changes, and what are their implications for the competitive dynamics and market outcomes in retail payments?

Read More

Investing, insurance or gambling?

The distinction between investment, insurance and gambling is an essential one for policymakers and regulators. At the most basic level it is easy to see the differences between these products. But is it possible to extend the theoretical distinctions to more complex products and so give consumers clearer guidance? Fod Barnes, Senior Adviser at the UK Payment Systems Regulator, and previously a Senior Adviser at Oxera, explores the issues

Read More

Conduct risk management—high five?

Financial services providers around Europe are subject to clear expectations from regulators regarding conduct risk (or ‘the risk of misconduct’ that can cause poor consumer outcomes or undermine market stability or competition). What are these expectations, and how can providers meet them? In our experience, managing conduct risk requires a new toolkit based on behavioural economics, business model analysis, machine learning, competition economics, and good governance.

Read More

Unbundling: what’s the impact on equity research?

The EU’s second Markets in Financial Instruments Directive (MiFID II), introduced in January 2018, requires brokers to charge separate fees for trade execution and for research, thereby ‘unbundling’ them. Since these rules came into force, there have been concerns about their impact on the provision of research and, more generally, the development of capital markets. What market failures does the unbundling rule intend to address, and what are its potential unintended consequences?

Read More

State aid spotlight on tax: the General Court’s judgments on Fiat and Starbucks

In 2015, the European Commission ordered Starbucks and Fiat to each pay €20m–€30m in the Netherlands and Luxembourg, respectively, as their tax arrangements were found to constitute illegal state aid. On 24 September 2019, the General Court upheld the Commission’s Fiat decision, but annulled the Starbucks decision. What were the key economic issues in these cases, and what are the implications of the judgments?

Read More

Will tech giants take over payments?

The Chinese payments industry has recently experienced significant disruptions from technology companies Alipay and WeChat. Although consumer preferences and the regulatory environment have played an important part in the success of Alipay and WeChat Pay in China, many factors are also applicable in the European context. With technology companies now evaluating opportunities in the European payments market (most recently, Facebook’s Libra), what can the Chinese example tell us about its likely evolution?

Read More

A flood of interest: Flood Re makes its mark

Flood Re, a pioneering flood insurance levy scheme in the UK, is celebrating its third birthday. Since its launch in April 2016, the scheme has helped over 200,000 households, and is now increasingly looking at how it can help the market to transition to ensure that Flood Re is no longer needed by 2039. Aidan Kerr, Director of Operations at Flood Re, explains the scheme’s history and underlying social purpose

Read More

Fair ground: a practical framework for assessing fairness

Regulators are increasingly looking to firms to ensure that their practices are ‘fair’ in terms of the process followed (e.g. the type of data used) and the outcomes delivered (e.g. which consumers pay more). So, how can boards and senior managers satisfy themselves that practices are indeed fair and in line with their firm’s principles and risk appetite? We present Oxera’s practical framework, which has been used as a tool by senior decision-makers in financial services firms

Read More

Stock-ing up: the design of equity trading markets in Europe

Equity markets, where investors buy and sell shares, are crucial to the European economy. Regulatory change has opened up competition, leading to more choice and lower trading fees, but also fragmentation and risks to price formation. There is an ongoing debate about the provision of market data services that often overlooks the links between market data services, trading and price formation. How is equity trading functioning from a market design and an end-investor perspective?

Read More

Open menu Close Search Play video RSS Feed Share on Facebook Share on Twitter Follow us on Instagram Follow us on Youtube Connect with us on Linkedin Email us Copy link