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Free keywords:
European Commission, European competition law, European financial market integration, German public banks, liberalization policies
Abstract:
In this article, I argue that the European financial market integration cannot be understood without the European Commission's gradual enforcement of supranational competition law for financial services. The conflict over the liberalization of public banks in Germany demonstrates how the Directorate General for Competition (DG COMP) deepened financial market integration through legal proceedings without the participation of the Council of Ministers. How could DG COMP prevail over the fierce resistance of Germany even though member states never intended for European law to have enough leverage to alter core elements of national financial systems? The article focuses on DG COMP's capacities for strategic action. DG COMP was able to enforce European competition rules for financial services, skilfully combining its legal competences with political strategies. The case illustrates that the regulatory integration of financial services in the EU is much more driven by supranational institutions than assumed by the bulk of the literature.
