Vanderbilt Journal of Transnational Law

First Page



I would like to concentrate on what we might call the international aspects of the European securities markets and, if nothing else, to define a couple of terms. What I want to do first is to look at the question of integration of capital markets, and what we mean by that term. Is it really easier for a French company to raise capital in Belgium than a company from the United States? Has there been any integration in the Common Market? Do foreign issuers raise capital on national securities markets in the currency of that market? I think we have to answer that question, "No." If you will look at the statistics shown in Table IV of the Appendix, you will see that in 1966, in all of the EEC countries, aside from Germany, the only foreign insurers making use of the national securities markets were international organizations. For example, in 1967, a total of 14 million dollars was the only money raised by foreign issue in the Netherlands. I think that we can say that the situation still is that the EEC markets are basically national markets. Germany is somewhat of a special case. Table IV contains statistics on Germany and Switzerland. These indicate that foreign issuers raised in Germany 205 million in 1967, and over 800 million in 1968. Although these issues were made in Germany in Deutchmarks, many of these issues should be treated as Eurobond issues. What once was a relatively easy definition of a Eurobond has become more complex, as the German situation shows. You must look factually at each issue to determine whether it was underwritten and sold only within Germany, or whether it was sold by an international underwriting syndicate. Aside from Germany, Switzerland has traditionally been a source, though somewhat limited, of capital for foreign issuers. The Swiss Finance Minister has controlled this with a queue system where you line up and wait your turn, but nevertheless, the market has been present. What has happened with the EEC? Why is there not more integration of capital markets of member countries?