Regulatory Philosophy Research Articles

China’s regulatory change toward genome-edited crops

China’s newly issued genome-edited crop safety assessment guidelines do not entirely deviate from the existing genetically modified regulatory regimes. However, there is an urgent need to reform the genome-edited regulatory framework based on scientific values and a novel regulatory philosophy that balances diverse values to enhance public trust.

Opinion: Establishing a science-into-policy process for tropospheric ozone assessment

Abstract. Elevated tropospheric ozone concentrations driven by anthropogenic precursor emissions are an environmental hazard scientifically similar to the depletion of the stratospheric ozone layer and global climate change; however, the tropospheric ozone issue lacks the generally accepted, international assessment efforts that have greatly informed our understanding of the other two. Here, we briefly review those successful science-into-policy approaches and outline the elements required to conduct a similar process for tropospheric ozone. Particular emphasis is placed on the need to establish a conceptual model to fully understand the underpinning science, useful policy metrics, and motivating international policy forums for regulating anthropogenic ozone production over the hemispheric and global scales, thereby expanding beyond the traditional regional, air basin approach that has dominated air quality regulatory philosophy to date.

ChatGPT Legal Risk and Regulation Study

ChatGPT is a high-profile artificial intelligence chatbot, and although it brings great convenience to society, it also brings a series of legal risks, including disputes over the ownership of intellectual property rights, the legality of data sources, and the quality of data used for training, the generation of undesirable or illegal information, and challenges to schools and academic ethics codes. The reasons for this are the specificity of this type of product and the fact that it has not yet developed a mature system at the technical level, while regulators and legislators are too conservative in their regulatory philosophy.

Research on Regulatory Sandbox Setting for the Development Needs of Emerging Industries

Under the background of the Fourth industrial Revolution, emerging industries have been developing vigorously. While injecting innovative vitality into the society, they have also exposed problems such as lack of supervision, difficulty in risk control and policy lag in current government governance. By sorting out the application effect and experience of "regulatory sandbox", a nascent governance tool, in different fields around the world, this paper analyzed the applicability and necessity of introducing "regulatory sandbox" into the regulatory system of China's emerging industries from the perspectives of innovation demand, regulatory philosophy and institutional logic. This paper chose the Bike-sharing industry which is extremely representative as the research object. and the "regulatory sandbox" model of Bike-sharing industry is designed to clarify the responsibilities of stakeholders such as the supervision subject, testing subject and participating user of the sandbox, and to explain the operation mechanism such as access, test and exit. Finally, this paper also analyzes the common problems of regulatory sandbox in the development of emerging industries and the special problems in the Context of China. Following this paper, the nascent governance tools such as "regulatory sandbox" and the supervision philosophy of agile governance should be applied to more emerging industries to achieve the goal of balancing innovation and risk, improve regulatory efficiency, and encourage emerging industries to exert a positive influence on society.

Why Does the Precautionary Principle Suffice for Blood Regulation?

Traditional approaches to blood regulation emphasise the precautionary principle and pursue zero-risk for viral transmission; these traditional approaches have usually followed tragedy, such as the HIV and hepatitis C infections that followed the use of factor VIII concentrates. However, a much more haphazard haemovigilance system operates for general adverse events. Such imprecise assessment of hazards prevents sound benefit-risk assessment, and for blood products this is further confounded by the fact that their efficacy has attracted little systematic study. The ongoing COVID-19 pandemic has now prompted the proposal of a convalescent plasma (CP) blood product. Clearly, mere freedom from infectious agents will not suffice in assessing CP, and an objective measure of efficacy, so as to permit formal benefit-risk analysis, is essential. This is both a scientific and an ethical demand, as has been the case for other experimental COVID-19 treatments. With special reference to COVID-19 CP, the well-recognized adverse events of transfusion-associated lung injury (TRALI) and transfusion-associated circulatory overload (TACO) will be important. Furthermore, not only efficacy but also product quality attributes (e.g., antibody titre) will have to be defined. Both of these are outside the traditional regulatory philosophy for blood products and are needed to truly assess the benefit-risk of this putative therapeutic product.

The Development and Regulation of Cryptoassets: Hong Kong Experiences and a Comparative Analysis

Cryptoassets have emerged as a new category of financial products in recent years and have attracted a great deal of attention from market participants and regulators. While the characteristics of cryptoassets, such as anonymity and disintermediation in transactions, bring significant benefits, they come with a range of significant risks concerning investor protection and market integrity. Due to the difficulties in regulating cryptoassets under the traditional framework, Hong Kong has set up its first comprehensive regulatory regime on cryptoassets in November 2018, imposing new standards on cryptoasset fund managers, distributors and platform operators. By means of a comparison with four major jurisdictions overseas, including Mainland China, the US, the UK, and Singapore, the strengths and potential concerns of Hong Kong’s new regime are analysed. Overall, the new regulatory regime for cryptoassets in Hong Kong is a significant development, addressing the issues of regulatory gaps and regulatory arbitrage that existed under the previous framework as well as introducing enhanced regulatory standards. This has the effect of improving investor protection, but there are some remaining concerns. Chief amongst them are the problems with regulatory scope, the application of traditional regulatory standards to cryptoassets that do not fall within the definition of securities or futures, problems with the sandbox mechanism, and ultimately as a matter of regulatory philosophy, the need for a better balance between investor protection and market development.

The Development and Regulation of Cryptoassets: Hong Kong Experiences and a Comparative Analysis

Cryptoassets have emerged as a new category of financial products in recent years and have attracted a great deal of attention from market participants and regulators. While the characteristics of cryptoassets, such as anonymity and disintermediation in transactions, bring significant benefits, they come with a range of significant risks concerning investor protection and market integrity. Due to the difficulties in regulating cryptoassets under the traditional framework, Hong Kong has set up its first comprehensive regulatory regime on cryptoassets in November 2018, imposing new standards on cryptoasset fund managers, distributors and platform operators. By means of a comparison with four major jurisdictions overseas, including Mainland China, the US, the UK, and Singapore, the strengths and potential concerns of Hong Kong’s new regime are analysed. Overall, the new regulatory regime for cryptoassets in Hong Kong is a significant development, addressing the issues of regulatory gaps and regulatory arbitrage that existed under the previous framework as well as introducing enhanced regulatory standards. This has the effect of improving investor protection, but there are some remaining concerns. Chief amongst them are the problems with regulatory scope, the application of traditional regulatory standards to cryptoassets that do not fall within the definition of securities or futures, problems with the sandbox mechanism, and ultimately as a matter of regulatory philosophy, the need for a better balance between investor protection and market development.

New financial regulatory philosophy: A paradigm shift in securities market supervision

The objective of this paper is to identify the changes in the financial regulatory philosophy in the securities market supervision after the 2008 global financial crisis. The mix-methodology researches are concluded by interviewing 101 securities regulators to investigate the impacts of the crisis on securities market supervision philosophy. Evidence is found to support the hypothesis that the 2008 global financial crisis has created a paradigm shift from standard finance to behavioural finance in securities supervision. However, regulators are still in a philosophical crisis when the theoretical ground they once believed turned out to be not suitable for the securities supervision. The analysis undertaken in this paper contributes to apprehend the theoretical aspects of the paradigm shift and constructs a pertinent financial regulatory philosophy, which observes the nature of securities markets, responds to the problems revealed by the 2008 global financial crisis, and takes into consideration the nature of emerging markets. Consequently, this paper proposes a multi-fold theoretical ground within the Keynesian regulation framework to be adopted for the construction of a securities market supervision philosophy in order to efficiently cope with market developments and be resilient to financial crises.

GDPR-Lite and requiring strengthening – Submission on the draft <i>Personal Data Protection Bill</i> to the Ministry of Electronics and Information Technology (India)

This submission concerns the draft Personal Data Protection Bill which accompanies the July 2018 Report of the Committee of Experts on Data Protection (‘Srikrishna Report’) appointed by the Indian government. The submission makes five general comments about the Bill, on these topics: 1. The draft Bill is a serious and modern draft law, and should only be strengthened, not weakened by MeitY in preparing a Bill for submission to the legislature. The Indian government has compelling reasons to enact a Bill resembling this draft. 2. The Report and Bill both reflect a very different regulatory philosophy from the EU GDPR’s radical dispersal of decision-making responsibility (and liability for wrong decisions) to data controllers. The Indian model is more prescriptive, but a justifiable regulatory option, provided it does not include excessive discretion to the government or the Data Protection Authority. 3. The Bill's data localisation requirements adopt an unjustifiable generic approach to data localisation, through blanket local copy requirements (with exceptions to be specified by government), and export prohibitions also specified by government. 4. The very broad exemptions from most of the Act for processing in the interests of State security or relating to law enforcement, although purportedly constrained by legality, necessity and proportionality (are dangerously vague). 5. The lack of complete independence of the DPIA, and the lack of any legislatively guaranteed independence by the Adjudicating Officers, represent unsound policy in relation to bodies whose function is to regulate government as well as the private sector. The submission also includes fifteen more specific recommendations for improvements to the Bill.

Stakeholder Conceptions of Later-Life Consumer Vulnerability in the Financial Services Industry: Beyond Financial Capability?

When the newly re-constituted UK financial services regulator–the Financial Conduct Authority–was launched in 2013, it promised to adopt a new approach to its “consumer protection” objectives. This shift included articulating a new conception of consumer vulnerability, beyond narrow, individualistic, conceptions of vulnerability based on (limited) financial capability, towards a broader conception which takes account of the connection between individual circumstances, situations, and market factors in causing or exacerbating manifestations of consumer vulnerability. Drawing on new empirical research with later-life financial services stakeholders and consumers, this article examines the extent to which equity release stakeholder perceptions of consumer vulnerability align to this new regulatory philosophy, and to the realities of consumer experiences. Our findings indicate that, in contrast to the FCA’s new, broader understanding of consumer vulnerability, the stakeholders in our study tended to understand vulnerability through a narrower lens, focusing predominantly on “information vulnerability,” or on whether or not the consumer “knows what they are doing.” This conception supports the assumption that providing financial advice is sufficient intervention to ensure good consumer outcomes. This assumption is also at odds with our earlier consumer study findings, which revealed a much wider set of vulnerabilities amongst equity release consumers. We reflect on the implications of these findings for the development of the later-life financial services industry, in ways that can more appropriately serve the needs of this consumer population.

WTO Rare Earths Case’s Influence on China’s Domestic Regulatory Changes

This article reviews the influence on China’s domestic governance exerted by a high profile WTO case – the Rare Earths case. It argues that China’s domestic regulatory framework for rare earths has been phenomenally reshaped by the WTO Rare Earths case. First, China removed the export restrictions on rare earths in order to implement the WTO Dispute Settlement Body (DSB) Rulings. Second, China improved environmental legislation to facilitate its defence in the WTO Rare Earths case, and incorporated environmental protection concerns in its regulatory philosophy. Third, China invested more administrative resources in mobilizing local governments to better implement rare earths policies, which cover the mining, production, circulation, and industrial consolidation of rare earths. While the first measure was mandatory in terms of China’s obligation to implement WTO DSB rulings, the second and the third initiatives resulted from China’s voluntary adjustment of its governance in reaction to the WTO Rare Earths case. Reading China’s engagement with the WTO Rare Earths case in the broader context of China’s performance in the WTO Dispute Settlement System (DSS), it is evident that China is a firm supporter of the WTO DSS: China has kept its good record of compliance with the WTO rulings, maintained its reputation as an active player in the WTO DSS, and embraced WTO’s far-reaching impact on its domestic management regime.

The Evolution of the EU External Trade Policy in Services – CETA, TTIP, and TiSA after Brexit

The conclusion of the Transatlantic Trade and Investment Partnership (TTIP) constitutes a priority and key component of the external trade policy of the European Union (EU). It is also an immediate follow-up to several years of regulatory cooperation between the two global trade powers. In an era of megaregionals, services is the only area where significant negotiating traction exists at the bilateral and multilateral level. However, recent events such as the imminent Brexit and the withdrawal of the USA from the Transpacific Partnership (TPP) cast doubt on the future of trade deals. Even so, services remain a key sector of export interest for the EU and thus completing agreements such as the TTIP or the Trade in Services Agreement (TiSA) is of crucial importance, allowing the EU to create new opportunities for service suppliers but also to reshape the regulatory philosophy governing the future regulation of global trade in services. With respect to TTIP, the EU Commission, backed by the EU executive, has advanced an ambitious agenda and submitted a conditional offer to the US, hoping for further liberalization on the two sides of the Atlantic. Against this backdrop, this article offers a critical account of the EU external trade policy, focusing on the EU’s recent external action with respect to services liberalization. The article advances three theses: first, that such ambitious agreements mark a new era of offensive services strategy which, however, is contained by internal conflicts and disagreements regarding certain still sensitive silos such as audiovisual or public services and Brexit shall exacerbate such internal conflicts in the medium run; second, that megaregionals can be used to accelerate domestic regulatory reform and openness in the service sector; and third, that TiSA will constitute a litmus test for the EU’s commitment to the World Trade Organization (WTO) cause. When appropriate, the article draws parallels with existing EU legislation and case law; other EU Free Trade Agreements such as the recently concluded Comprehensive Economic and Trade Agreement (CETA) with Canada; the General Agreement on Trade in Services (GATS); and TiSA.

The Evolution of the EU External Trade Policy in Services - CETA, TTIP and TiSA after Brexit

The conclusion of the Transatlantic Trade and Investment Partnership (TTIP) constitutes a priority and key component of the external trade policy of the European Union (EU). It is also an immediate follow-up to several years of regulatory cooperation between the two global trade powers. In an era of megaregionals, services is the only area where significant negotiating traction exists at the bilateral and multilateral level. However, recent events such as the imminent Brexit and the withdrawal of the US from the Transpacific Partnership (TPP) cast doubt on the future of trade deals. Even so, services remain a key sector of export interest for the EU and thus completing agreements such as the TTIP or the Trade in Services Agreement (TiSA) is of crucial importance, allowing the EU to create new opportunities for service suppliers but also to reshape the regulatory philosophy governing the future regulation of global trade in services. With respect to TTIP, the EU Commission, backed by the EU executive, has advanced an ambitious agenda and submitted a conditional offer to the US, hoping for further liberalization on the two sides of the Atlantic. Against this backdrop, this article offers a critical account of the EU external trade policy, focusing on the EU’s recent external action with respect to services liberalization. The article advances three theses: first, that such ambitious agreements mark a new era of offensive services strategy which however is contained by internal conflicts and disagreements regarding certain still sensitive silos such as audiovisual or public services – and Brexit shall exacerbate such internal conflicts in the medium run; second, that megaregionals can be used to accelerate domestic regulatory reform and openness in the service sector; and, third, that TiSA will constitute a litmus test for the EU’s commitment to the WTO cause. When appropriate, the article draws parallels with existing EU legislation and case-law; other EU Free Trade Agreements (FTAs) such as the recently concluded Comprehensive Economic and Trade Agreement (CETA) with Canada; the General Agreement on Trade in Services (GATS); and TiSA.

Twin Peaks Regulation After the Global Financial Crisis: A Reform Model for China?

Abstract The global financial crisis (GFC) has been defined as the worst financial crisis after the Great Depression of the 1930s. Reforms underway, as well as debates in discussion, revolve around both regulatory philosophy and approaches towards better supervisory outcomes. One of the most radical institutional reforms took place in the United Kingdom (UK), where the Twin-Peak model replaced the previous fully integrated regulator – the Financial Services Authority (FSA) under the Financial Services Act 2012. This paper argues that China should also introduce twin peaks regulation, but it is rather based on the resources of risk in its financial sector than the direct GFC challenge. In theory, the core arguments focus on the structure of agencies responsible for prudential regulation and the role played by the central bank as well. The Twin-Peak model has been further examined in terms of regulatory objectives and instruments. By method, this paper is a country-specific comparative study; Australia, the Netherlands and the UK are selected to represent different Twin-Peak models. This paper contributes to the relevant literature in two main aspects. First, it has displayed the principal pattern of the Twin-Peak model after detailing the case studies, including the relationship involving in two regulators, central bank and finance minister in particular. Based on this, second, it becomes possible to design a very specific model to reform China’s current sector-based financial monitoring regime. As far as the author knows, until end-2015, this is the first paper which has proposed such a particular model to China. It is argued that the appropriate institutional structure of market regulation should fit well in with a country’s financial market. Accordingly, the Twin-Peak model will be able to balance the regulatory tasks for the over-concentrated risk in China’s large banking sector but the underdeveloped securities market. Even though, regulatory independence will continue to be challenged.

Enhancing the Relationship Between Regulators and Their Profession.

Regulators face unique pressures to balance competing priorities related to patient safety, public accountability, and practitioners' expectations. Historically, the collegial model of self-regulation has been used as a tool for risk management, to recognize the importance of profession- and context-specific judgment in complex, ambiguous clinical situations. Increasingly, as public accountability concerns have grown dominant within regulatory bodies, this collegial model has shifted toward a more antagonistic relationship between the regulators and the regulated. Wilkie and Tzountzouris (2017) highlight one profession's journey toward embedding professionalism within regulatory practices and policies through application of a right-touch regulatory philosophy. Given the complexity of regulatory work, this shift required significant strategic and deliberative thinking. The challenges of facilitating this sort of cultural shift in the role of a regulator are significant, but so too are the potential gains associated with a more engaged relationship between regulators and their practitioners.

Audit Firm Perspective on Audit Firm Rotation and Enhancing Independence: Evidence from PCAOB Comment Letters

SUMMARYThis study examines practitioners' perspectives on audit firm rotation and alternative solutions to enhance independence in the audit industry as solicited by the PCAOB's “Concept Release on Audit Firm Rotation and Auditor Independence.” Accordingly, we synthesize the opinions found in comment letters of 15 American public accounting firms—eight of which are annually inspected by the PCAOB and seven of which are inspected tri-annually. Altogether, we find the firms generally offer homogenous rationale for opposition to audit firm rotation. However, most importantly, we note that the overwhelming majority of the alternative solutions offered by the firms to enhance the independence relationship between auditor and client lies with fortifying the audit committee. To that end, while regulators have generally attempted to strengthen independence by introducing regulation at the auditor level, our review indicates that perhaps a shift in regulatory philosophy is warranted—one that suggests progressing regulation at the client level.Data Availability: Publicly available.

Negotiating Services Liberalization within TTIP - The EU External Trade Policy at Crossroads

The conclusion of the Transatlantic Trade and Investment Partnership (TTIP) constitutes a priority and key component of the new external trade policy of the European Union (EU) and an immediate follow-up to several years of regulatory cooperation between the two global trade powers. In an era of megaregionals, services in the only area where significant negotiating traction exists at the bilateral and multilateral level. From an EU viewpoint, services is a key sector in these negotiations. As expected, the EU Commission, backed by the EU executive, has advanced an ambitious agenda and conditional offer to the US, hoping for further liberalization on the two sides of the Atlantic. Importantly, these negotiations are expected not only to generate additional liberalization, but should also reshape the regulatory philosophy as far as the regulation of trade in services is concerned. Against this backdrop, this article offers a critical account of the current TTIP negotiations relating to trade in services from an EU perspective. When needed, the article draws parallels with other EU Free Trade Agreements (FTAs) and the General Agreement on Trade in Services (GATS).

Analysis of regulatory systems of broadcasting and telecommunications: A comparative study focusing on Korea and the United States

This study compares the historical formation of regulatory systems for broadcasting and telecommunications between Korea and the United States. In particular, we analyze various metaphors about telecommunications and broadcasting and which metaphors and discourses have been adopted in the social context. We further examine how such metaphors and discourses contributed to different regulatory philosophies and regulatory systems in Korea and the United States with a focus on comparative historical analysis. Analysis shows that regulatory philosophy and the framework of telecommunications and broadcasting were constructed in different historical contexts in both countries. The perception that communication technologies are public resources was pervasive in the U.S., but in Korea, the function of broadcasting was recognized as a means of government control or dissemination of propaganda implemented under Japanese colonial authorities and the rule of the U.S. military government. How these different social/historical contexts led to different regulatory philosophies and systems in the U.S. and Korea is discussed.

The EU Short Selling Regulation Revisited: New Evidence, Different Perspective?

EU Regulation 236/2012 lays down a common regulatory framework for short selling that is based on three fundamental principles: disclosure of short positions; settlement discipline; and supervisory discretion to intervene where market stability is threatened. Building on the most recent empirical and theoretical research, the article critically assesses the underlying rationales and regulatory philosophy of this novel EU short selling regime. This article concludes that the EU legislature has adopted a well-balanced, proportionate and flexible regulatory approach that addresses the risks of short selling without undermining its market efficiency benefits. In addition, the article makes specific proposals for refining and further improving the EU short selling regime that are expected to assist the relevant EU bodies in future revisions of EU Regulation 236/2012.

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