The state of the Union speech on Wednesday 14 September provided the president of the European Commission with the opportunity to call for no time to be lost in creating a Capital Markets Union (CMU). Of the initiatives already on the table, one has been there for more than a year: the proposal to breathe new life into the securitisation market. The inter-institutional negotiation phase has not even started yet, as the European Parliament has still to agree on its negotiating position. "Let us please speed up its adoption", Jean-Claude Juncker said in his speech on Wednesday morning.
There was not much new in the communication on the CMU, published on Wednesday. Just calls to conclude what is already on the table: the European Parliament will decide on its negotiating position this Thursday on the proposed regulation of the Commission modifying the rules on the prospectuses that European companies wishing to raise capital must publish to provide potential investors with information. Before the summer, the European Commission also proposed modifications to the European law on the activities of European venture capital funds (EuVECA) (345/2013) and social entrepreneurship funds (EuSEF) (Regulation 346/2013), to respond to the problems encountered by the industry.
The Commission wants to speed up its own work on the forthcoming initiatives. It has promised a proposal for the near future on the restructuring of businesses and insolvency, to speed up the asset recovery process and give businesses a second chance after going bust for the first time. The Commission will also encourage the states to remove the fiscal barriers to the creation of withholding tax. In the framework of the relaunched common consolidated corporate tax base, which is expected for 9 November this year, the Commission will promote financing through venture capital, calibrating its tax treatment on that of financing by borrowing, which is tax deductible.
The Commission will also be tweaking the legislation on insurance and banks by the end of the year, in order to mobilise more private investment in infrastructure and SMEs. Working closely with the Parliament and the Council, it will also examine the next stages regarding the supervision framework, in order to guarantee investor protection, promote the integration of the capital markets and preserve financial stability.
The Commission is also reflecting on other priorities. It intends to support the development of markets for individual pension product and other retail financial services, to encourage European citizens to make better use of their savings. It will also be looking at the development of financial technologies (FinTech) and will carry out a mid-term review in 2017, so that it can see what other initiatives may be necessary.
The European Securities and Markets Authority welcomed this "strong signal" sent out by the Commission in favour of growth and job creation. (Original version in French by Élodie Lamer)