On June 21, the new Communication forms the Commission’s contribution to the Euro Summit.
It takes stock of the progress made to deepen EMU since the publication of the Five Presidents’ Report: Completing Europe’s EMU on June 22, 2015. READ MORE
CMU
EIOPA Publishes Call for Evidence on Integration of Sustainability Risks in Solvency II
On January 17, the European Insurance and Occupational Pensions Authority (“EIOPA“) published a call for evidence on the integration of sustainability risks and factors in the prudential assessment of assets and liabilities for insurers and (re)insurers under the Solvency II Directive (2009/138/EC). The Commission’s initiatives on sustainable finance form part of its broader initiative to establish the capital markets union (“CMU“).
The deadline for responses to the call for evidence is March 8, 2019. EIOPA plans to prepare a draft opinion for consultation during the second half of 2019 for submission to the European Commission in the third quarter of 2019.
The call for evidence relates to the European Commission’s call for advice from EIOPA and ESMA in July 2018, following which EIOPA launched a survey to help it build up a suitable evidence base on the sustainable finance legislative proposals.
EIOPA expects to collect market data to analyze how sustainability risks affect (re)insurers investments, with particular focus on climate change, as well as data on market practices on insurance underwriting. The Commission has asked EIOPA to assess whether Solvency II presents any inherent incentives or disincentives to sustainable investment, including but not limited to investments in unrated bonds and loans, unlisted equity and real estate. National competent authorities will collect information from individual undertakings within their jurisdiction to support EIOPA’s analysis.
European Commission Calls on European Parliament and the Council of the EU to Accelerate Work on Completing CMU
On November 28, the European Commission published a communication (COM(2018) 767 final) on the capital markets union (“CMU“). The Commission outlined that the CMU is a key priority for a number of reasons:
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completing the CMU is essential to make member state economies more resilient and to safeguard financial stability;
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the CMU will offer more choice to consumers allowing them to buy cheaper and better investment products;
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the CMU will enable financial service providers to scale-up by offering their services in other member states.
Since 2015, only three of the Commission’s original proposals contributing to the CMU have been adopted and 10 of 13 proposals are under discussion by EU legislators, including proposals on the pan-EU personal pension product and an EU covered bonds framework. The Commission calls on the European Parliament and Council of the EU to accelerate the remaining proposals before the May 2019 Parliament elections.
The full communication can be found here. The annex was published separately alongside an FAQs document.
European Commission Calls to Accelerate the Capital Markets Union Reforms
On September 14, 2016, the European Commission published a communication calling for an acceleration of the capital markets union (CMU) reforms (COM(2016) 601 final) in light of the current political and economic context.
Elements of particular interest to financial services practitioners include:
- The Commission will support the co-legislators in reaching an agreement by the end of 2016 on the modernization of the prospectus rules;
- The Commission calls on both the European Parliament and the European Council to finalize the Regulation amending the European Social Entrepreneurship Funds Regulation (Regulation 346/2013) (EuSEF Regulation) and the European Venture Capital Funds Regulation (Regulation 345/2013) (EuVECA Regulation) also by the end of 2016;
- The prospect of a legislative proposal being tabled in 2017 relating to a simple, efficient and competitive EU personal pension product;
- To reduce capital charges attaching to investments by insurers in infrastructure corporates, the Commission will adopt an amendment to the Solvency II Delegated Regulation (Regulation (EU) 2015/35);
- In the hope of strengthening retail investor participation in capital markets and opening up the EU market for retail financial services, the Commission will present an action plan on retail financial services.
The Annex to the communication also provides an update on the CMU action plan initiatives.