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The scholarships, cryptocurrency companies and compensation houses operating in the EU should rest under the supervision of the Market Block watchdog, according to its chair.
Verena Ross, president of the European Securities and Markets Authority, told Financial Times by the plans developed by the European Commission, the regulation of several EU financial markets should be transferred from national authorities to ESMA.
Such changes would provide key momentum to “have a crucial market in Europe which is more integrated and worldwide,” she said.
The plans, which are controversial among the small countries of the EU such as Luxembourg and Malta, are designed to “ensure that we approach the continuous fragmentation of the markets and solve this to create more than one single market for capital in Europe”, added Ross.
The EU initially proposed to make ESMA the main supervisor of cryptographic asset service providers – such as the exchanges and the guards of digital currencies – when drafting its historic markets in the regulation of crypto -active (Mica), which entered into force this year.
But criticism of ESMA’s ability to manage this meant the surveillance of the rapidly growing cryptography market was left in the hands of the national authorities – a decision that Ross declared had created ineffectures.
In July, ESMA criticized the Malta process to approve the Pan-EU licenses for cryptographic companies, claiming that “certain risks have not been adequately evaluated during the authorization process” for an unnamed company.
“While we do a lot of work to try to make sure that the implementation of the mica is aligned, we clearly need a lot of efforts and national supervisors to achieve it,” said Ross.
“It also means that people had to build specific new resources and expertise 27 times in different national supervisors, which could have been done more effectively once at European level.”
ESMA was created in 2011 to improve the harmonization of rules across the EU. But many block financial market activities continue to be supervised by its 27 national authorities.
“We have tried for some time with the Syndicate of Capital Markets and other initiatives to build a more effective capital market,” said Ross. “Reality has been that it is not easy to do since we have very different market structures.”
Mario Draghi, the former president of the European Central Bank, in a historical report, identified the transformation of ESMA into a single common regulator for all the values of the block securities – similar to the Securities and Exchange Commission in the United States – as “key pillar” to stimulate the financial markets of Europe.
Some small EU countries, such as Luxembourg, Malta and Ireland, opposed the centralizing powers of ESMA, fearing that this will undermine their flourishing financial sectors.
Claude Marx, head of the Luxembourg financial surveillance dog, recently said that if ESMA had become the main supervisor for all EU investment funds, this would create a “monster”.
However, the president of ESMA said that the need for the block to find funding for his vast investment in defense, green energy and digitization had given new momentum to the thrust to “decompose the barriers and the fragmentation that still exist”.
She added: “The demand for this is so high now given the need to find private capital to support the strategic priorities of Europe, it has clearly increased, not only at the EU level but also in the Member States.”
The authority based in Paris has already received additional powers since the publication of the Draghi report.
From next year, he will resume supervision of new consolidated tape suppliers – an information database on live actions – for stock prices and bonds, as well as agencies providing environmental, social and governance ratings.
Maria Luís Albuquerque, EU Commissioner of Financial Services, said in a speech last month that he “envisaged a proposal for the transfer of surveillance powers to ESMA for the most important cross -border entities”, in particular scholarships, cryptographic companies and central counterparts.
“All this would imply changes in the ESMA governance and decision -making processes, and we have various models to consider on the basis of other existing centralized supervision models,” said Albuquerque.
Additional Paola Tamma report in Brussels
