EU threatens reciprocal controls on US firms

Link: EC urged to stay out of Sarbanes-Oxley dogfight

Fritz Bolkenstein, financial services chairman at the EU, threatened a tit-for-tat retaliation in a letter written to SEC chairman William Donaldson, after demanding that EU auditors be made exempt from the Sarbanes-Oxley Act, according to the FT.

The new US regulator, the Public Company Accounting Oversight Board, created under Sarbanes-Oxley is demanding that EU firms that audit US companies be made to sign up with it and come under its scrutiny.

The EU has argued against this saying it would impose unnecessary regulation on firms, who are already regulated by their own national authorities.

Bolkenstein said if the SEC forced EU firms to register with the PCAOB, the EU would have no choice but to force US firms to register with its member states.

ICAEW president Peter Wyman is reported to be against the EU lobbying efforts, instead calling for each member state to negotiate individually with the SEC.

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