The simplification recommendations suggested by the European Commission on the retail investment (‘RIS’) package are insufficient for the co-legislators. While the Polish Presidency of the Council of the EU is questioning the very continuation of the current interinstitutional negotiations (‘trilogue’) (see EUROPE 13639/6), the European Parliament, on Wednesday 14 May, stated that it wanted to put new simplification measures on the table in order to flesh out the Commission’s recommendations.
“Simplifying and finalising the Savings and Investment Union: that’s our course for finalising the RIS work. The Commission is only at the beginning, but we expect more proposals. At Parliament, we are working to raise this ambition for the next trilogue”, Parliament’s chief negotiator, Stéphanie Yon-Courtin (Renew Europe, French), told Agence Europe on Wednesday evening.
Earlier in the day, the ‘shadow’ rapporteurs from Parliament’s various political groups met to take stock of the situation.
According to a source close to the matter, Parliament’s negotiating team is expected to take the simplification further through a range of new options to be submitted to the European Commission’s services by early June. “There is a broad consensus around this approach”, said this source.
The question of the ‘investor’s journey’ should be at the heart of this work.
The left wing of the House fears deregulation. However, after analysing the Commission’s informal recommendations (see EUROPE 13635/16), the Social Democrats were keen to stress the need to maintain “effective regulation” in the simplification process.
“We support all kinds of simplification, provided this does not affect the policy objectives of the RIS proposal, which is attracting more retail investors to the capital markets by reducing costs of investment products, increasing competition on the market and tackling underperforming investment products and biased advice”, Eero Heinäluoma told Agence Europe on Tuesday.
The Finnish MEP expressed concern about the general direction of the current negotiations with the Council of the EU (see EUROPE 13602/21). “There is a risk that we are forgetting the need for efficient regulation to create well-functioning financial markets in Europe, looking too much into the deregulation agenda”, he said.
For its part, The Left Group denounced the European Commission’s retreat from its “initial aims”, recalling the co-legislators’ abandonment of the partial ban on inducement fees (see EUROPE 13376/36) and criticising the current discussions on value for money.
“The Commission is willing to move ahead via ‘promoting existing best practices around peer grouping’. In the Commission’s original proposal, value for money was supposed to be achieved via benchmarks developed by ESMA/EIOPA”, stressed Finnish MEP Jussi Saramo, arguing that the current direction of the trilogue runs counter to the interests of European savers. (Original version in French by Bernard Denuit)