The European Commission (EC) has adopted a new capital markets union (CMU) action plan which proposes legislative changes and new objectives. The EU’s top priority is to ensure that Europe recovers from the economic crisis caused by COVID-19 and the EC has stressed that access to market financing has an essential role to play in achieving this.
Developing the EU’s capital markets will facilitate the flow of money from savings and investments across the EU in order to benefit consumers, companies and investors irrespective of where they are located and will help sustain the recovery and return to long-term growth of the EU economy post-coronavirus. It will also help finance green and digital transitions and support the creation of a more inclusive and resilient economy.
The CMU action plan highlights the following three key objectives:
- ensuring that economic recovery is green, digital, inclusive and resilient by making financing more accessible to European companies, in particular SMEs;
- making the EU an even safer place for individuals to save and invest long-term; and
- integrating national capital markets into a genuine pan-EU single market.
To achieve these goals, the EC has set out proposals for 16 legislative and non-legislative actions, including:
- creating a single access point to company data for investors;
- supporting insurers and banks to invest more in EU businesses;
- strengthening investment protection to support more cross-border investment in the EU;
- facilitating monitoring of pension adequacy across Europe;
- making insolvency rules more harmonised; and
- pushing for progress in supervisory convergence and consistent application of the single rulebook for financial markets in the EU.