In the April-May issue of this Newsletter, we alerted you to some of the legal and practical implications for financial services providers regarding the forthcoming adoption of the euro as the single currency of eleven European Union ("EU") member states (Austria, Belgium, Finland, France, Germany, Ireland, Italy, Luxembourg, the Netherlands, Portugal, and Spain) on January 1, 1999. As discussed in that article, this so-called Economic and Monetary Union ("EMU") creates a series of complications for U.S. corporations with significant European operations, and financial services companies, in particular, that need to be quickly resolved. Not only will EMU be a technological nightmare, requiring overhauls to internal information systems and accounting procedures, but it will also have serious legal implications. Lack of timely preparation for the introduction of the euro may mean foregone business opportunities, a loss of customers, and legal troubles.
Over the past several months, two federal regulators have added to the sense of urgency with the issuance of advisories to financial services firms and banks, reiterating the need for preparation and planning for EMU. First, the Board of Governors of the Federal Reserve System (the "FRB") issued an advisory letter to supervisory officers of FRB member organizations regarding EMU . Then, the staff of the Securities and Exchange Commission ("SEC") published instructions for issuers, broker-dealers, investment advisers, and investment companies in connection with EMU.
This article was first published in the August/September 1998 Issue of Mayer, Brown & Platt's Financial Services Regulatory Report. The Financial Services Regulatory Report is edited by Melody A. Chestnut of the Washington, DC Office.
Copyright © 1999 Mayer, Brown & Platt. This Mayer, Brown & Platt article provides information and comments on legal issues and developments of interest to our clients and friends. The foregoing is not a comprehensive treatment of the subject matter covered and is not intended to provide legal advice. Readers should seek specific legal advice before taking any action with respect to the matters discussed herein.
