United in diversity: maximum versus minimum harmonization in EU securities regulation

Judging by recent policy statements by HM Government, gold-plating, ie the super-equivalent implementation of EU law,¹ is increasingly falling out of favour in the UK. The general position is that gold-plating should be avoided, unless in exceptional circumstances.² The reason usually given for this policy decision is that UK businesses should not be put at a competitive disadvantage compared with their European counterparts.³ If we focus on the securities markets directives, then this is a somewhat narrow explanation, since the listing in a highly regulated environment can also be interpreted by investors as a signal for the quality of the issuer, which may translate into lower costs of capital for the issuer.⁴

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This article uses the policy change in the UK as a starting point to analyse the extent to which gold-plating remains permissible in EU securities regulation, focusing on prospectus disclosure, transparency requirements and market...