On Tuesday 20 April, the European Commission launched its work on its future strategy for retail investment, expected in the first half of 2022 and announced in its Capital Markets Union Action Plan (see EUROPE 12562/9).
According to the roadmap published by the Commission, the strategy will aim to ensure that retail investors can take full advantage of capital markets and that rules are consistent across legal instruments.
Currently, the level of retail investor participation in financial markets in the EU remains low by international standards, it explains.
The strategy should include an assessment of the rules with regard to incentives and disclosures. Advice provided by intermediaries can sometimes be biased in favour of products that are more profitable for intermediaries, the Commission points out.
It should also provide for a review of the existing categorisation of investors, including the status of retail investors in comparison with professional investors, and the introduction of a requirement for advisers to obtain a certificate proving their level of knowledge and qualifications.
The future strategy should also reflect developments in digitalisation and sustainability, the Commission says. The role of social media, the emergence of online brokers and the ease of access to retail investments for new types of investors have indeed changed the market and their impact needs to be assessed.
The Commission has ordered a study on consumer information, incentives and advice, as well as on benchmarking. The results, which will feed into the future strategy, should be available in autumn 2021.
Read the roadmap: https://bit.ly/3arDFqd (Original version in French by Marion Fontana)