The effects of the ongoing credit market crunch understandably dominated discussion at the opening of the annual conference of the International Organization of Securities Commissions in Paris today.

The crisis has sparked a great variety of regulatory reform proposals from a diverse collection of regulators, and international coordinating bodies.

Although, in his opening address to the conference, Michel Prada, outgoing chairman of IOSCO’s technical committee and chairman of the France’s Autorité des marchés financiers, insisted that regulators couldn’t have done anything to prevent the turmoil. Calling the credit crunch “the most severe turmoil we have seen for many years”, Prada, said, “We must obviously recognise that we could not prevent it, neither did we anticipate it when we met collectively, a year ago.”

However, he noted that a number of regulators did sound warnings, including a coupe of vice governors of the U.S. Federal Reserve Board, the Joint Forum of Financial Market Regulators, and his own AMF, which initially studied the rating of structured products in 2005. the Financial Stability Forum also “identified some of the risks while, nonetheless, underlying the resilience of the financial system,” he added.

That said, he also suggested that the episode illustrates that they must become more proactive to such emerging risks in the future. Prada noted that securities regulators tend to react to market events rather than anticipating them, and he suggested that many of them believe that this is the way it should be, “and that trying to discipline the market in advance might be both hazardous and detrimental to its dynamism and efficiency.”

However, Prada said he believes, “We should be more ambitious in our analysis of these expected risks and with our capacity to anticipate their consequences and hopefully minimise possible disruptions.”

“I know that this is both a difficult task and also a controversial approach to regulation,” he allowed. “However, I do believe that, along the way, we can find a better and more useful balance between reactivity and proactivity. This is obviously what governments and public opinion expect from us.”

Additionally, he called for a more efficient, effective IOSCO. He noted that it has committed to getting all of its members to sign onto its multilateral memorandum of understanding by 2010 — which would, among other things, improve cross-border enforcement.

And, he said that IOSCO must get tougher with jurisdictions that, “play a significant role in cross-border activities”, but, “either cannot, or do not want to, play according to the rules and are not members of the club.” Prada didn’t name the jurisdictions he was referring to, nor did he say just what measures should be used to bring them into line, only saying, “we should consider new initiatives to resolve the remaining difficulties.”

Echoing Prada’s remarks, Greg Tanzer, IOSCO’s secretary general, said that getting all jurisdictions to sign onto the MOU to improve information sharing is an important goal for the global regulatory system. He also allowed that there should be more discussion between IOSCO and industry to help identify emerging risks; that these consultations should take place on an ongoing basis; and that it also needs to engage more with the investor community to ensure that voice is heard, too.