EU Seeks 1 ESMA Rulebook for 27 Markets as Fragmented Oversight Hurts Competitiveness
Updated
Updated · ifre.com · Jun 17
EU Seeks 1 ESMA Rulebook for 27 Markets as Fragmented Oversight Hurts Competitiveness
2 articles · Updated · ifre.com · Jun 17
Summary
A December EU package would shift more securities-market supervision to ESMA, replacing conflicting national oversight with a single rulebook across the bloc.
27 member states now apply EU law differently, officials and executives said, creating supervisory divergence that slows responses to market changes and weakens predictability for firms.
A recent delay underscored the problem: final technical standards for the EU’s derivatives active-account requirement arrived in February, nearly two years after the 2024 text.
ESMA already directly supervises EU-based derivatives clearinghouses, and regulators said extending that model could simplify rulemaking and crisis response by ending parallel supervisory structures.
LCH SA and Euronext London backed the shift, arguing fragmented national practices leave Europe at a competitive disadvantage against the more centralized U.S. market.
Is a single financial watchdog the silver bullet for Europe to finally challenge America's dominance in capital markets?
As one regulator amasses power, what prevents a single mistake from triggering an EU-wide financial meltdown?
Transforming EU Capital Markets: 2026 Legislative Reforms, Integration Challenges, and Global Ambitions
Overview
The European Union is in the final stages of major financial reforms, with trilogue negotiations between the Parliament, Council, and Commission focused on a legislative package to boost financial stability and competitiveness. Central to these talks are updates to the Securitisation Regulation and the Capital Requirements Regulation (CRR), where key disagreements remain, such as how to set risk-weighted floor formulas. The Council wants to keep the current cap, while the Commission and Parliament have debated removing it, though Parliament later agreed to a cap. These decisions are crucial for shaping a more integrated and resilient EU financial market.