EU countries have agreed on a package to strengthen the bloc’s financial markets watchdog at a meeting of finance ministers in Luxembourg on Friday.
The Market Integration and Supervision Package (MISP) would give the European Securities and Markets Authority (ESMA) direct oversight of major market operators currently supervised by national authorities.
While some rules are harmonised across the EU, differences in implementation, supervision and enforcement have contributed to fragmentation in financial markets.
The Irish presidency said the package aims to make it easier for savings and investments to flow across borders, helping companies access finance and giving households more opportunities to earn returns on their savings.
The package would give ESMA direct oversight of major trading venues, clearing houses and bodies that handle securities settlement, as well as crypto-asset service providers. It would also create a full-time, independent executive board within the watchdog.
Market operators could opt into a new framework for operating across the EU. The reforms would make national supervision more consistent and update rules on trading, completing transactions, managing investments and using blockchain technology.
However, some trading venues run by Deutsche Börse, which operates the Frankfurt stock exchange, may remain outside ESMA’s direct supervision.
Euronews previously learnt that Germany had secured an exemption for Deutsche Börse’s domestically focused trading venues, leaving a key part of the system under regional German supervision. The current announcement did not give details on this matter.
Dutch Finance Minister Eelco Heinen welcomed the agreement, saying: “Major step forward today in advancing the Capital Markets Union. We made more progress in 10 months than in 10 years.
This marks an important milestone in the Savings and Investments Union (SIU), which aims to channel more of Europeans’ savings into investments that support the economy.
Supporters of more integrated capital markets argue that they would lower costs and improve access to funding for companies, while giving savers and investors more investment options.