Embargoed
until 10 June, 10 am CEST
Brussels, 10 June 2020
Final Report of the
High-Level Forum on Capital Markets Union
A clear roadmap for
markets serving European citizens
“Europe needs more than ever a well-functioning CMU to
support its economic recovery and provide alternative sources of financing,
putting the financial well-being of European citizens at its centre. We commend
the members of the High-Level Forum for their important contribution to the necessary
revitalisation of the CMU project” says
EFAMA’s Director General Tanguy van de Werve.
Taking inspiration from past European successes, such
as the creation of UCITS, the report* rightly emphasises the need to foster
retail investors’ participation in capital markets by developing a
stronger equity culture in Europe (through the development of second and
third-pillar pensions as well as greater financial literacy) and by ensuring
that investors benefit from high-quality, reliable and fair advice, so as to
promote confidence and trust in the functioning of capital markets.
Against this backdrop, we particularly welcome the
HLF’s call for an urgent review of the PRIIPs regulation (and more generally of
disclosure rules across legislations, focusing on digital communication). We
see this review as absolutely necessary to fix a number of significant flaws in
the PRIIPs KID and to avoid jeopardizing the success of the UCITS brand.
“Citizens should be
empowered to take good decisions for their financial well-being, by giving them
access to clear and reliable information in an affordable manner and making
full use of new digital solutions. Financial regulation must be fit for
harnessing the potential of new technologies “, added T. van de Werve.
EFAMA further embraces the recommendation on targeted
adjustments to the ELTIF regulatory framework to accelerate the take up of
these products by investors with a long-term investment horizon and offer a new
source of financing to unlisted companies, SMEs and infrastructure projects. We
have made concrete proposals to that effect.
The report makes a number of technical recommendations
around relief at source of withholding taxes which is
warmly welcomed by EFAMA as a response to a long-standing request from the
asset management industry. We note
however that there are wider tax issues which
need to be taken into consideration. Recognising that taxation is
an important driver of investment decisions, it is important to consider how it
can be used to incentivise cross-border investments, and to resist the
temptation of erecting new tax obstacles as we relaunch our economies
The report rightly
highlights the pivotal role CMU plays
in achieving the objectives of sustainable growth in Europe and to
deliver Europe’s New Green Deal. It stresses the importance of good governance
and improved corporate transparency on all ESG aspects and the potential of
active stewardship.
Insufficient availability of comparable and reliable
ESG data remains a key challenge to unleash the
potential of sustainable finance. Therefore, we applaud the recommendation to
establish an EU Single Access Point (ESAP). This would result in a central
access to financial and non-financial public corporate disclosures under the existing
EU regulations, including NFRD and SRD II. This is in line with the recent call
by several trade associations, including EFAMA, for a central EU ESG data
register**.
On a more critical note, we are
disappointed to see that the report does not refer, even incidentally, to the
increasingly important issue of data costs. Asset managers are among the most
important users of data (market data, index data, ESG data…) and have been
witnessing a steady increase over recent years in the cost of use of such data,
which does not appear to be commensurate with the cost of production and
dissemination by data providers and distributors. This constitutes a clear
impediment to the effective functioning of CMU that
needs to be addressed head-on through decisive actions from
policymakers and supervisors.
-
ENDS –
*The report
of the High-Level Forum on CMU is available at 10 am CEST on their website. Summary recommendations can be found on pages
28-29.
**The
joint industry letter on a central EU ESG data register is attached.
For media enquiries, please contact:
Hume BrophyKerri – Anne Rice – kerrianne.rice@humebrophy.comPaul Andrieu – paul.andrieu@humebrophy.com info@efama.org
Notes to editors:About the European Fund and Asset Management
Association (EFAMA):
EFAMA,
the voice of the European investment management industry, represents 28 member
associations and 59 corporate members. At end 2019, total net assets of
European investment funds reached EUR 17.8 trillion. These assets were managed
by close to 34,200 UCITS (Undertakings for Collective Investments in
Transferable Securities) and 29,000 AIFs (Alternative Investment Funds).
Responsible investment is at the heart of the fund and asset management
industry. Our industry strives to deliver long term sustainable investment
returns for investors in Europe and beyond. As a result, EFAMA supports the
objectives of the Green Deal and Sustainable Finance agendas, working together
with EU policy-makers on detailed provisions to ensure they are workable in
practice. More information available at www.efama.org.