Getting sign-off from the EU’s 27 governments would be a major coup for Dublin, which is chairing legislative negotiations in Brussels until the end of the year.
However, six diplomats close to the negotiations gave contrasting views on whether a deal would be possible this week. According to one, anywhere from eight to 17 countries could band together to block an agreement.
The diplomats did concede that the countries opposing the carveout are not unified in their position, however, as they all want different things from a potential deal. But the Deutsche Börse issue remains the most contentious.
After the German government made it clear it would not support a deal on the package unless Deutsche Boerse was carved out, the EU’s six biggest economies came up with a plan over the summer to exempt the exchange from EU-wide supervision by the new “supercop” European Securities and Markets Authority.
The German state of Hesse, Deutsche Boerse’s current supervisor, has consistently opposed giving up the role, fearing job losses and waning influence if the exchange giant is instead overseen by ESMA. The carveout, based on trading thresholds and geographical footprint, would also benefit Spain’s main stock exchange and another German trading platform, Tradegate.
In practice, scoping out the German giant would hollow out the ambition of the MISP plan. Moving to a central supervision model for the EU’s biggest exchanges and other financial plumbing firms like clearinghouses and central securities-depositories has been the thorniest political issue throughout negotiations.