Transnational Market Abuse and the Politics of Surveillance Delegation in the EU
National surveillance is often insufficient to identify transnational issues. One solution to this problem is to delegate to international organizations (IOs) the power to surveil activity in numerous states simultaneously, acting, in essence, as supranational detectives. When should we expect states to engage in such delegation? This article contends that this will depend on whether sub-state public agencies have acquired the exclusive capacity to surveil that phenomena at the national level. Those that have will actively oppose delegation to preserve the benefits afforded by that exclusivity, thereby reducing the likelihood that an IO is ultimately empowered to perform supranational surveillance. This hypothesis is tested against two case studies in which EU energy and securities regulators contemplated empowering an IO with supranational surveillance powers to detect transnational market abuse. Empirical evidence, drawing on 86 interviews, corroborates that each group’s pre-existing surveillance capabilities impacted their delegation preferences and, in turn, whether delegation occurred. These findings advance our understanding of supranational delegation and the politics of multi-level governance in the EU. Further, they shed empirical light on transnational market abuse, an understudied form of financial crime that hurts consumers, destabilizes prices, and facilitates the movement of illicit funds across borders.