Financial Services: EU seeks to boost Capital Markets Union

The European Commission has published a new, ambitious Action Plan to boost the European Union’s Capital Markets Union (CMU) over the coming years. Developing the EU’s capital markets, and ensuring access to market financing, is considering crucial in the continent’s efforts to spur on economic recovery.

Large and integrated capital markets will facilitate the EU’s recovery, making sure that businesses – in particular small and medium-sized businesses – have access to sources of funding and that European savers have the confidence to invest for their future. Vibrant capital markets will also support Europe’s green and digital transition, as well helping to create a more inclusive and resilient economy. The Capital Markets Union is also crucial to boost the international role of the euro.

Valdis Dombrovskis, Executive Vice-President for an Economy that works for People said: “The coronavirus crisis has injected real urgency into our work to create a Capital Markets Union. The strength of our economic recovery will depend crucially on how well our capital markets function and whether people and businesses can access the investment opportunities and market financing they need. We need to generate massive investments to make the EU economy more sustainable, digital, inclusive and resilient. The new Action Plan aims to tackle head-on some of the remaining barriers to a single market for capital.”

To do this, the Commission proposed sixteen targeted measures to make real progress to complete the CMU. Among the measures announced today, the EU will:

• Create a single access point to company data for investors;
• Support insurers and banks to invest more in EU businesses;
• Strengthen investment protection to support more cross-border investment in the EU.
• Facilitate monitoring of pension adequacy across Europe;
• Make insolvency rules more harmonised or convergent;
• Push for progress in supervisory convergence and consistent application of the single rulebook for financial markets in the EU.