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Four-level Approach




The Four-level approach is the process to develop financial service industry regulations and the enforcement thereof in four stages, used by the .

The four respective stages in regulation development according to the four-level approach are the following:

# the European Parliament and European Council of the European Union adopt a first piece of legislation, establishing the core values of a law
# sector-specific committees and regulators advise on technical details, then bring it a vote in front of member-state representatives
# national regulators work in cross-border committees, such as CESR {Link without Title} for example, on coordinating new regulations with other nations
# the new rules are supervised and if necessary enforced.

A very significant European directive developed according to the four-level approach is the Markets in Financial Instruments Directive, or MiFID .

The four-level approach should provide several benefits over traditional lawmaking, including more-consistent interpretation, convergance in national supervisory practices, and a general boost in the quality of legislation on financial services.