For nearly a decade, leading scholars have bemoaned the absence of what can be termed a market for securities laws. Unlike the federalist structure of US corporate law, which may incentivize some states to compete for corporate charters, no competition for firms animates the enactment of national securities laws. Instead, the federal government has enjoyed a virtual monopoly over the provision of securities laws. Ever since the passing of the Securities Act of 1933 (“Securities Act”) and the Securities Exchange Act of 1934 (“Exchange Act”), firms have generally had to comply with US securities laws when selling their stocks and bonds to American investors. And because US stock exchanges were the most liquid in the world, there was little danger of foreign multinationals going elsewhere to raise capital. As a result, federal regulators have had few incentives to formulate efficient regulatory policies. A revolutionary transformation of global equity markets is, however, currently underway.
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