This article describes the development of the competing regulatory bodies for banking, insurance, securities and derivatives. It then focuses on the regulatory roles of the Securities and Exchange Commission ("SEC") and the Commodity Futures Trading Commission ("CFTC"). The competition between those two agencies and its effects are described. After that review, the article examines the roles of the FSA-GB and FSA-Japan. Finally, the article discusses the arguments favoring and disfavoring competitive regulation and tries to discern whether a unified regulatory structure such as that in Japan and England is preferable to the competitive approach of the SEC and CFTC. The issue of the desirability of a single super regulator over securities and derivatives has been debated since the creation of the CFTC in 1975. There has been little success in achieving any unified regulation. Still, the issue will not recede, and a unified regulator seems to be a sound idea. The model provided by the FSA-GB lends support for such unification while the model presented by the FSA-Japan shows the weaknesses of such an approach. Should America choose a super regulator approach, it must be cautious to avoid an agency that will seek to manage the economy or respond to every financial crisis with intrusive regulation.
Jerry W. Markham, Super Regulator: A Comparative Analysis of Securities and Derivatives Regulation in the United States, the United Kingdom, and Japan, 28 Brook. J. Int'l L. 319 (2002).