Developments in the German equity market and its regulation

The German stock market has developed by leaps and bounds over the past two years. German legislators have, for example, introduced a large number of improvements that have brought the underlying conditions of the German financial markets into line with international standards. Market participants thereby have the potential — above all through the introduction of a single European currency — to actively avail themselves of the resulting opportunities. The future will see progressive globalisation and increasing international competition on the financial markets and the markets for goods and services. There will also be a greater need for pension plans funded through the capital markets. These developments will further promote the utilisation of shares as a financing and investment instrument in Continental Europe and, especially, in Germany. Introduction of the Euro will considerably reinforce these developments and the integration of markets. The German financial markets are well prepared to meet these challenges. Market participants are taking advantage of the improved underlying legal environment to develop their position among international competitors.