European Finance Ministers showed broad consensus on Friday 10 July in favour of adopting a general approach on the ‘MISP’ package next October. No EU Member State opposed the timetable proposed by the Irish Presidency of the EU Council in its ‘roadmap’ (see EUROPE 13905/26). “This goal will only be achieved on the basis of equality, balanced, and proportionate compromise”, nonetheless cautioned Irish minister Simon Harris after the Economic and Financial Affairs Council.
“A very clear instruction has been given to the technical teams of each Member State to now engage on trying to find landing zones and compromises”, the Tánaiste assured the press, recalling the EU countries’ commitment on the ‘roadmap’, ‘One Europe One Market’, which provides for the legislative work on this file to be finalised between the EU co-legislators before the end of 2026. Dublin wanted to focus on a tacit commitment from Ministers without getting sidetracked by the stumbling blocks in the file that had more strongly characterised discussions under the six-month Cyprus Presidency.
Several Ministers nevertheless reiterated their red lines, particularly on supervision. Dutch Minister Eelco Heinen argued for direct supervision by ESMA of “a significant number of big pan-European entities across all subsectors” and called for “a strong ESMA”, endowed with a “decisive and independent” executive board. The French side struck a similar tone. Minister Roland Lescure stressed that integration could not proceed without supervision and argued that the scope of direct supervision should cover “all market segments”.
Other Ministers insisted more strongly on the safeguards needed for the reform of the European Securities and Markets Authority (‘ESMA’). Belgian Minister Jan Jambon defended supervision based on criteria that are “objective, consistent, and free from entity-specific carve-outs”, warning that “where centralised supervision does not add value”, alternative solutions should be favoured and “strong and meaningful involvement of national authorities” preserved.
Portugal’s Joaquim Miranda Sarmento, Denmark’s Jakob Engel-Schmidt, as well as their Maltese, Cypriot and Slovenian counterparts, also argued for EU supervision to be limited only to genuinely ‘cross-border’ entities and for day-to-day responsibilities to continue to rely on the expertise of national supervisors.
Commission rejects watered-down compromise, ECB insists on robustness. “If it doesn’t deliver on the objective, then it cannot be a good compromise”, European Commissioner for Financial Services and the Savings and Investments Union Maria Albuquerque stressed on Friday to the EU27, urging them not to strip the legislative package of its ambition. It “will no doubt be a game changer on how the markets look at us”, she said.
And she added: “This is what will determine whether the markets will believe if we are really serious in bringing our resources together and working together to the benefit of the whole of the EU economy”.
President of the European Central Bank (ECB) Christine Lagarde supported strengthening ESMA’s role, considering that an “independent” executive board was essential for effective supervision. Mrs Lagarde nevertheless insisted that this was not about setting national authorities against ESMA, but about them working “in intelligent cooperation”.
The ECB President also warned of the risk that tokeniation of financial instruments, another key component of the package, could create “another layer of fragmentation”, calling on Ministers to guarantee interoperability and standardisation of post-trade infrastructures from the outset. (Original version in French by Bernard Denuit)