'More power to Esma': Brussels tightens up on the European single market
Commission unveils reform package to overcome divergences from country to country
From our correspondent Beda Romano
BRUSSELS - Ten years after the revolution that allowed the transfer of banking supervision to the European Central Bank, Brussels presented today, Thursday 4 December, an ambitious legislative package that should serve to reduce the persistent national divergences in the big world of finance, among other things by strengthening the power of ESMA, the Paris-based European financial market supervisory authority.
"For too long, Europe has tolerated levels of fragmentation that hold back our economy," said Financial Affairs Commissioner Maria Luís Alburquerque. By creating a true single financial market, we will give citizens better opportunities to increase their wealth and unlock more funding for European priorities. Market integration is not a technical exercise, but a political imperative for Europe's prosperity and global relevance'.
Acountering National Barriers
The European Commission proposes to amend no less than seven pieces of legislation. As said, the aim is to reduce national barriers, and allow finance to become a pillar of the single market as well. There is now an awareness that the many national divergences contribute to the financial prudence of households and companies. It is estimated that Europeans have around EUR 10 trillion in savings accounts, money that could be invested more productively.
"Greater harmonisation of authorisation, operation and supervision rules will provide legal clarity and predictability for companies, enabling them to allocate resources more efficiently, expand their activities and compete more effectively both within the European Union and globally," reads the documentation published today in Brussels. According to the EU executive, the legislative package will contribute to regulatory simplification.
The Vigilance
On the politically sensitive supervisory front, the European Commission proposes to simplify supervisory processes by 'extending ESMA's direct supervision of certain significant cross-border entities in the trading and post-trading sector, strengthening supervisory convergence tools and improving coordination between national authorities'. Currently, ESMA is merely a hub for cooperation between member countries.
