School of Law

Event time: 12:00-13:00

Title: ‘From Punishment to Compensation in EU Capital Markets: Repurposing Pecuniary Penalties for Investor Redress’

Abstract

Investor protection is essential to the development of EU capital markets. A key concern is ensuring compensation for investor losses resulting from price distortions caused by misleading disclosures by listed companies. Since the 2008 financial crisis, the EU has extensively harmonised administrative sanctions, empowering regulators to impose substantial pecuniary penalties on listed companies. Yet investor compensation remains largely dependent on national civil liability regimes, and can be difficult to obtain in practice. This presentation explores whether closer coordination between administrative enforcement and investor compensation is achievable. Drawing inspiration from the US “fair funds” mechanism, it examines the possibility of establishing “EU investor compensation funds”, financed by the proceeds of pecuniary penalties imposed on listed companies, to compensate investors harmed by misleading disclosures