The REGTECH Book

Making Regulation Machine Readable

By Ralf Huber

Co-Founder, APIAX

For decades, lawyers such as myself have been mastering the art of interpreting regulation for financial services, but in a rapidly digitizing world, regulatory interpretation must also become binary. Moreover, a new wave of new RegTech solutions is just around the corner.

Dealing with regulations has sometimes felt like being caught in the treadmill: regulatory implementation project after regulatory implementation project, numerous unclarified case-by-case requests in between, more and more unhappy business stakeholders and clients – and no comprehensive solution in sight. For almost a decade, the industry has been trapped in a regulatory crisis.

While the problem statements around managing regulation remain complex, I am convinced that the following three courses of action would massively lower the pain of the financial industry:

1. Financial institutions should give up today’s individual approach to regulations and start an industry-wide collaboration.
2. The mindsets of lawyers working for both regulators and the industry itself must shift towards a more machine-readable and standardized interpretation of regulations.
3. Instead of further building up legal and compliance teams to manage regulations by hand, the financial services industry should invest in more efficient processes – such as having a ‘digital compliance officer’.

Invest in Industry Standards, Instead of Individual Approaches

When it comes to ...