Prof. Dr. Pierre-Henri Conac Appointed as Max Planck Fellow

Max-Planck Institute Luxembourg announced today that Prof. Dr. Pierre-Henri Conac, Professor at the University of Luxembourg, has been appointed as Max Planck Fellow by the President of the Max Planck Society.

The Max Planck Fellow Programme promotes cooperation between outstanding university professors and Max Planck Society researchers. The appointment of Professor Conac as Max Planck Fellow is limited to a five-year period and also entails the supervision of a small working group at the Max Planck Institute Luxembourg for Procedural Law.

Professor Pierre-Henri Conac will work on the regime of administrative pecuniary and non-pecuniary sanctions in financial markets’ law in the European Union (EU) and as such is expected to contribute significantly to the expertise of the Luxembourg financial centre in this field.

According to Max-Planck Institute Luxembourg, there has been a growing recognition by the European legislator that administrative sanctions are effective in the regulation of financial markets. This effectiveness is important not just from a financial law perspective but also from an overarching context since the recent financial crisis have caused European democratic civil societies to request much more accountability in the financial sector.

The Institute added that, despite recent effort towards harmonisation, the current legal landscape in the EU remains fragmented and, in some areas, practically incoherent. Member States do not have a common view on the procedural aspects of administrative sanctions, despite some harmonisation provided by the case law of the European Court of Human Rights (ECHR). This situation contradicts the European Commission's intention to achieve "supervisory convergence" in the EU. The lack of harmonisation becomes increasingly pressing in a post-Brexit context as the Commission, through an equivalence process, allows third country companies to have cross-border access to the single financial market. The concept is used across the world. 

The research that Prof. Dr. Pierre-Henri Conac will carry out is considered to be of global interest. The International Organization of Securities Commissions (IOSCO), which sets international standards in financial markets, is working on how to achieve “Credible Deterrence in the Enforcement of Securities Regulation”, which is often achieved through administrative sanctions. IOSCO is also working to facilitate cross-border access to financial markets and could play a role in the assessment of equivalence.

The research project will analyse the differences between substantive and procedural rules in order to determine which provisions could benefit from greater harmonisation, with the aim of simplifying and increasing the effectiveness of enforcement. It could have an impact on regulatory practice and legislative developments in the Member States, especially in a major financial centre like Luxembourg, and in the EU in general, leading to a review of the system of administrative sanctions and, possibly, of the accompanying procedures.