The new supervisory body is designed to expand oversight of the EU’s key financial infrastructure, which, in addition to stock and cryptocurrency exchanges, will take under its control and clearing houses, specifies in its material Financial Times with reference to sources in the European Commission.
The initiative aims to eliminate fragmentation in the single market and reduce the costs of cross-border trade, which hinder the development of startups and companies in Europe. The European Commission believes that the creation of a single supervisory authority modeled on the U.S. Securities and Exchange Commission (SEC) will be an important step towards creating a “union of capital markets” in the EU.
The European Commission’s proposals for a “market integration package” would include, as the FT specifies, strengthening the powers of the European Securities and Markets Authority (Esma). It will have the right to issue binding decisions in disputes between national regulators and major asset managers, as well as control significant cross-border organizations and infrastructure, including cryptoasset service providers.
Although the European Commission itself considers the idea progressive and necessary, not all EU member states are enthusiastic about the new initiative. So far, only Ireland and Luxembourg have expressed the greatest opposition, fearing that the expansion of Esma’s supervisory functions will mean higher fees for the industry.
The rest of the EU countries are more reserved in their assessment of the European Commission’s intentions, suggesting to wait for concrete proposals and only then assess the prospects of the “market integration package”. But many experts are concerned that the centralized supervision model will be ineffective or not entirely acceptable to many countries.
