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p. 11 of 14 BACK | NEXT Opening Remarks by Mr. Barry Metzger Presentation of Prof. Mochtar Kusuma-Atmadja Harmonization of Laws in the Region Arbitration in the 1990s: Developments in East Asia Regional Cooperation between National Regulators Commentary by Mr. Michael Ryland Commentary by Dr. Sukjo Kim Discussion

Seminar on Legal Aspects of Regional Cooperation : Presentation of Prof. Mochtar Kusuma-Atmadja

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Regional Cooperation between National Regulators

Another element of the legal aspects of regional cooperation not treated so far in this paper is cooperation between national regulators in the Region, particularly in such areas as securities regulation, banking regulation and in new areas of regulatory activity. As many of the economies in the Region are at the stage of liberalizing and deregulation of such areas as the electricity industry, the telecommunication industry and the aviation industry, regional cooperation could also extend to cooperation among company law regulatory officials of neighboring countries including cooperation in the areas of cross-border insolvency. Another form of cooperation would be among or between regulatory officials dealing with licensing and intellectual property rights such as patents and trademarks.

In my opinion, it is still too early to have cooperation among regulatory officials. We in the East Asian Region, the ASEAN sub-region in particular, have been very wary of too much regulation. We definitely do no want to follow the path of the EU which at the present stage of development seems to be over- regulated. Laws and regulations are a means to an end and should remain so. It should not become an end or objective in itself. Regulation creates the need to have bureaucrats and a bureaucracy to implement the regulations. The EU at present is, for all practical purposes, run by a bureaucracy headquartered in Brussels. They seem to be regulating everything from electricity sockets to the various kinds of cheese and many other things affecting the lives of ordinary citizens. Some regulations and standards set by the Eurocrats are useful and indeed establish standards of sorts. Other standards are less useful or are clearly the product of a bureaucrat's over-zealousness. Where no standards have been set, situations may arise which may seem strange to outsiders but quite serious for the parties involved. Right now, there is a dispute going on between Greece and Denmark on the subject of feta cheese with the Greeks insisting that only cheese made out of goat's milk can be properly called "feta cheese". A complaint has been lodged with the European Commission that the Danes are marketing a commodity which is marketed as feta cheese but which is not made of goat's milk but of cow's milk.

I think that the Southeast Asian Region or ASEAN at least is wise not to follow the path of over-regulation and creating a huge bureaucracy to run the system. It will not only be too expensive but will defeat the purpose of regional cooperation.

There will come a time when the financial markets in ASEAN member states will start and nurture that cooperation between regulators or regulatory agencies if and when it is needed.

The investigations and subsequent trial by Singapore of Mr. Nicholas Leeson of Barings Bank show that some mature markets with a strong regulatory body like the Monetary Authority of Singapore (MAS) are in fact ready for such regional or international cooperation.

I personally feel that regional cooperation between regulators or regulatory bodies should be left to a natural process, with the interested parties taking the initiative if and when it is considered necessary. It may come sooner than we think.

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