Abstract
ABSTRACT This article analyses infringement and settlement decisions issued by the European Commission in recent years in relation to cartels in the foreign exchange (‘forex’ or ‘FX’) sector, assesses what these decisions tell us about the susceptibility of the forex sector to anticompetitive behaviour and proposes how these risks might be reduced. This includes a focus on addressing the lack of transparency that characterises the sector. It is argued that preventing similar abuses occurring in future cannot be left to competition law alone, but rather requires greater ex ante regulation of the forex sector. As such, a crucial first step is the need for greater data gathering and analysis in relation to the purposes for which most forex trading is undertaken and it is proposed that there should be a stronger division between traders’ market-making activities and proprietary trading to try to minimise opportunities for collusive conduct and reduce information asymmetries.
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