VZCZCXRO3709
PP RUEHAG RUEHDF RUEHIK RUEHLZ
DE RUEHTC #1726 2201057
ZNR UUUUU ZZH
P 081057Z AUG 06
FM AMEMBASSY THE HAGUE
TO RUEHC/SECSTATE WASHDC PRIORITY 6498
INFO RUCPDOC/USDOC WASHDC
RUEATRS/DEPT OF TREASURY WASHDC
RUEHFT/AMCONSUL FRANKFURT 3447
RUCNMEM/EU MEMBER STATES COLLECTIVE
RUEHAT/AMCONSUL AMSTERDAM 1205

UNCLAS THE HAGUE 001726 
 
SIPDIS 
 
SIPDIS 
 
STATE FOR EUR/UBI ERIC FALLS, RICHARD REITER 
USDOC FOR 4212/USFCS/MAC/EURA/OWE/DCALVERT 
TREASURY FOR IMI/OASIA/VIMAL ATUKORALA 
PARIS ALSO FOR OECD 
STATE PLEASE PASS FEDERAL RESERVE 
USEU FOR RICHARD GAFFIN 
 
E.O. 12356: N/A 
TAGS: EFIN ECON EINV ELAB NL
SUBJECT:  DUTCH CONCERNS OVER NYSE/EURONEXT MERGER 
 
REF: THE HAGUE 1391 
 
THIS CABLE CONTAINS PROPRIETARY INFORMATION. IT IS SENSITIVE 
BUT UNCLASSIFIED. PLEASE HANDLE ACCORDINGLY. 
 
¶1.  (SBU)  SUMMARY  The proposed NYSE/Euronext merger has 
raised concern among Dutch politicians, regulators, and 
investors about how national rules would apply or could be 
evaded across borders under such an arrangement.  The Dutch 
Finance Ministry, which has the legal authority to approve 
or block the merger, will address its concerns with the 
Dutch Parliament and in an upcoming meeting with U.S. 
Senator Shelby.  END SUMMARY 
 
¶2.  (SBU)  U.S. and Dutch regulators and policy officials 
are working together to understand better the regulatory 
implications of the planned NYSE/Euronext merger.  The 
Ministry of Finance (MOF) is confident that the merger can 
take place in such a way that existing legislation will 
continue to apply at a national level, but is worried that 
U.S. companies may attempt to use the NYSE/Euronext merger 
as a means to avoid U.S. regulation.  The Dutch worry that 
this might induce U.S. lawmakers to pass regulation that 
applies across borders. 
 
¶3.  (SBU)  The U.S. Securities and Exchange Commission (SEC) 
publicly emphasizes that U.S. laws will not apply across 
borders.  Visiting SEC staff recently told Dutch Financial 
Markets Authority and MOF representatives that they are 
still discussing the issue with the U.S. Justice Department. 
The MOF wants to see any potentially controversial 
regulatory matters resolved before shareholders vote on the 
proposed merger in mid-December. 
 
¶4.  (SBU)  Bernard ter Haar, MOF Deputy Treasurer General, 
will meet August 18 with Richard Shelby, Chairman of the 
U.S. Senate's Banking Committee, to discuss the issue of 
home-country control.  The meeting is part of the Senator's 
upcoming visit to Brussels.  Also next week, Finance 
Minister Zalm will answer questions from the Dutch 
Parliament about the merger.  Zalm's own VVD party 
(conservative Liberals) has asked whether a NYSE/Euronext 
merger is preferable to a NYSE/Deutsche Borse one and how 
the MOF would ensure that U.S. regulations do not apply to 
Euronext Amsterdam.  Wiclef Poesiat, MOF Policy Advisor, 
told Emboff that Zalm continues to believe that market 
forces must determine the final decision in this case 
(reported reftel).  His response to parliament will 
reiterate that view. 
 
ARNALL