The Effects of the ESMA's Powers on National Contract Law

The establishment of the ESMA is one of the most important innovations introduced by the EU post-crisis reforms. Whereas a considerable amount of literature has already deeply investigated the impact of the ESMA's powers on regulatory convergence, supervision, and public enforcement, little attention has been paid to the effects that the ESMA's powers could exert on national contract law and the private enforcement of EU financial regulation. The main hypothesis of this study is that, although ESMA does not have the power of creating, suspending, or terminating contractual obligations, some of its acts (e.g. product's restrictions, guidelines, recommendations) may become an important legal source for the parties to design their contractual obligations and for the national courts and alternative dispute resolution mechanism to enforce national contract law. Starting from this hypothesis, the chapter explores the potential conflicts that might arise between the ESMA's (quasi) regulatory and supervisory powers and national contract law and it argues that the new powers of ESMA will not only strengthen the regulatory and supervisory convergence in the EU but they will also increase the ongoing process of “hybridisation” between EU financial regulation and national contract law