failure family

regulatory arbitrage

24 claims across 20 works.

• exemption-circumvention: The Commodity Exchange Act family and friends exemption allows a qualifying manager to trade options and futures for fifteen individuals who need not
• threshold-gaming: A retail investor asset threshold would be gamed: managers would be incentivized to keep retail assets under the applicable threshold, thereby keeping
• regulatory-arbitrage-by-forum-choice: For European jurisdictions the extraterritorial application of US law creates confusion and legal uncertainty and makes it harder to regulate private
• regulatory-arbitrage: Without a degree of international convergence in contingent capital rules, regulatory arbitrage could undermine the establishment of contingent capita
• Uncoordinated bail-outs breed regulatory arbitrage: Because most national crisis responses took the form of public bail-outs adopted without broad international consensus, they increased the threat of i
• Regulatory arbitrage blocks contingent capital adoption: Without a degree of similarity and convergence in bank resolution and contingent capital rules, regulatory arbitrage will work against establishing co
• manipulable-transaction-location: The Second Circuit's Absolute Activist test, locating a transaction where title transfers or irrevocable liability is incurred, is easy to manipulate:
• client-counting-safe-harbor-loophole: The client counting safe harbor, which let an adviser count a pooled entity rather than each investor as a single client, allowed advisers to manage l
• exemptions-swallow-the-rules: Because Title IV's registration exemptions are broad enough to threaten the rule they qualify, the Dodd-Frank Act deliberately gives the SEC rulemakin
• exemption structuring around client count thresholds: The pre Dodd-Frank exemption for advisers with fewer than fifteen clients failed as a regulatory boundary because most hedge fund advisers deliberatel
• Threshold gaming to avoid registration: The Dodd-Frank Act registration threshold creates incentives strong enough that some advisers opt out of registration and disclosure by strategically
• Asymmetric compliance burden: When disruptive firms do not comply with existing rules or effectively create their own exemptions because the existing framework does not reach them,
• Regulatory disconnect driven offshoring: The decline in later stage robotics and drone investment rounds in the United States does not indicate stalled technological development; companies re
• Credit migration outside the banking perimeter: Because the Dodd-Frank Act discouraged banks from growing too large and made bank lending harder, private funds and other alternative lenders filled t
• Same risk, different investor gate: The investor eligibility line has become arbitrary in the credit space: private funds implementing substantially the same investment strategy as a fix
• Regulatory arbitrage by disruptive firms: When disruptive firms do not comply with existing rules or write their own exemptions because no appropriate rules exist, consumer protection and publ
• rules-circumvention-by-dlt: The FCA has acknowledged that distributed ledger technology has unique aspects capable of working around current regulations.
• jurisdictional arbitrage trap: Direct hedge fund regulation faces a two sided trap: strong direct rules push hedge funds offshore where they escape regulation altogether, while weak
• regulatory avoidance presumption collapses under enforcement: The assumption by ICO issuers that token sales let them circumvent securities registration and disclosure requirements proved to be a fallacy for many
• Static rule gaming: In any open and democratic system, naturally opportunistic rational parties will attempt to circumvent and game the applicable complex static rules to
• rule-compliant-subversion: However rules are formalized in a realistic setting, there exist strategies that follow the rules yet subvert the intentions of the framers, so legal
• Rule-limit exploitation: In a rigid competitive hierarchy governed by secular laws, internal corruption arises because each member's optimal strategy is to push the written ru
• regulatory-evasion: Legislation is the wrong remedy for oracle exploitation, because the existence of an arbitrage opportunity means systems will evolve around whatever r
• Regulatory arbitrage from divergent national approaches: Persistent differences between jurisdictions that favor a permissive, innovation driven approach and those that prioritize strict control and consumer