In response to the targeted consultation on integrating EU capital markets, launched by the European Commission on 15 April, the Norwegian asset manager Norges Bank Investment Management (‘NBIM’) sent a 14-page letter on Tuesday 10 June expressing its support for reforms aimed at speeding up the EU’s financial integration.
“We share the concern that European markets over time have fallen behind in terms of business dynamism and the provision of new investment opportunities to institutional investors”, stresses NBIM, which is responsible for managing Norway’s global government pension fund, whose investments in securities issued by EU Member States and European companies totalled €285 billion at the end of 2024.
The main shortcomings identified as requiring priority solutions include the persistent diversity of national legal frameworks (securities law, company law, insolvency regimes), the fragmentation of tax regimes - particularly with regard to withholding tax - and the need to harmonise the process for issuing debt securities at European level.
The NBIM is calling for active support for the ECB’s European Distribution of Debt Instruments (EDDI), which aims to create a standardised, pan-European bond issuance system.
On equity markets, the manager advocates liquidity aggregation mechanisms based on “competition, innovation and transparency” rather than regulatory intervention. The fund supports the establishment of a centralised market data system (‘consolidated tape’) that is “fast, deep and attributed“, capable of playing a structuring role in the integration of fragmented markets.
Finally, the NBIM recommends unified supervision of capital markets at EU level. “Unified supervision would ensure consistent interpretation and application of regulation, reduce operational complexity and legal uncertainty, and avoid any perception of ‘regulatory arbitrage’”, the Norwegian fund writes in its letter.
See the full NBIM letter: https://aeur.eu/f/h91 (Original version in French by Bernard Denuit)