An explanation of the Commission’s Call for Evidence as regards the EU regulatory framework for financial services.
The Commission’s Call for Evidence on the EU regulatory framework for financial services seeks to examine the extent to which the numerous rules put in place since the financial crisis, which aim to improve financial stability and public confidence, might in fact interact with each other. The central question for the Commission is whether the cumulative effect of such rules creates unintended negative consequences or unnecessary burdens, for example where there are excessively complex rules, duplicated reporting requirements or instruments that are outdated due to technological change.
The reason for this is that there are currently more than 40 legal instruments and 200 secondary instruments which have been adopted by the Commission in this area. The Commission acknowledges that whilst regulation is required to ensure the proper, stable functioning of the markets and ensure investor protection and consumer confidence, long-term investment and sustainable economic growth must not be discouraged.
The criteria against which responses will be assessed include: the promotion of financial and economic stability, sustainable growth and access to finance, particularly for SMEs, promotion of the single market, restoring trust in the financial system, ensuring consumer and investor protection, ensuring clarity and simplicity of EU rules, and the promotion of competitiveness.
It remains to be seen whether this recalibration exercise will result in fewer legal instruments and a lighter regulatory regime, or whether the Commission will introduce further legal instruments to consolidate the current regime. The Call for Evidence closes on 6 January 2015.