Daniel Hemel


Should federal securities laws apply to overseas transactions involving shares that are cross-listed on US. exchanges? This Comment approaches that question from two directions: Supreme Court doctrine and modern finance theory. As a doctrinal matter, this Comment argues that under the Supreme Court's 2010 decision in Morrison v. National Australia Bank Ltd., the answer is yes: federal securities laws should apply to all transactions involving shares that are listed for trading on US. exchanges, including transactions that occur overseas. From a finance theory perspective, this Comment explains how allowing foreign firms to "opt in" to US. securities laws through cross-listing can create an environment in which issuers choose the legal regime that minimizes their capital-raising costs. The Morrison majority opinion, if faithfully followed, could mark a step toward a system of "issuer choice." Yet, federal district courts have strayed from the text of the Morrison majority's holding in ways that may reduce the efficiency of capital markets.

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