On Tuesday 30 May, the European Securities and Market Authority (ESMA) published its response to the European Commission's public consultation on the effectiveness and efficiency of the European Supervisory Authorities (ESAs).
In a letter to the European Commissioner for Financial Services, Valdis Dombrovskis, ESMA President Steven Maijoor issued recommendations to improve the authority's operations and help it to achieve its objectives of protecting investors and achieving stability on the financial markets of the EU.
In the framework of its mid-term revision of the Capital Market Union, the European Commission is planning to reinforce ESMA's powers in certain specific areas (see EUROPE 11793).
“ESMA stands ready to assume any new supervisory tasks should they be assigned” to it, the authority states, adding that these new duties must be accompanied by the allocation of “appropriate resources”.
ESMA has proposed several base criteria to determine whether supervision duties should be carried out at European level. These are: strong cross-border angle, high risk of regulatory arbitrage, ability to pool technical expertise at EU level and efficiency gains for the EU or national public authorities or market participants.
ESMA also takes the view that it should be the central contact for technical questions related to third countries, particularly regarding equivalence and supervision.
“The review allows us to take into account that the UK will leave the EU, which reinforces the need to build the CMU and it increases the importance of third-country issues for European financial markets”, the letter states. With regard to this, the authority is planning to put to the Commission a more detailed opinion on improving the regimes in force for third countries.
ESMA's other recommendations include improving supervisory convergence and access to data, together with a reinforcement of its powers in both areas.
In a position paper published on 16 May, the association representing European employers, BusinessEurope, called for no significant changes to be made to the structure and powers of the ESAs, arguing that cross-border supervision would be more effective under the current European architecture (see EUROPE 11791). (Original version in French by Marion Fontana)