BRUSSELS (Reuters) – European Union finance ministers on Monday set out priorities for creating a Capital Markets Union over the next five years to attract private capital to Europe and help fund the costly transition to a “green” and digital economy.
The priorities list key areas of work for the next European Parliament and executive European Commission, which will begin their terms in the second half of the year.
Below are the main issues the ministers want EU institutions to focus on until 2029:
THE COMMISSION
* Assess what is holding back the development of the EU securitisation market, including the prudential treatment of securitisation for banks and insurance companies, and reporting and due diligence requirements.
* Assess how to improve supervision. The aim is to strengthen financial integration, ensure financial stability, simplify processes and reduce compliance costs for supervised entities across the bloc.
* Propose ways of harmonising different national accounting rules so that corporate information can be compared more easily across borders.
* Further develop and improve the pan-European pension product (PEPP) to offer all citizens attractive pension options and make sure that pension savings are invested productively.
THE COMMISSION AND SUPERVISORY AUTHORITIES
* Assess how to cut the regulatory burden and transaction costs, in particular for smaller market participants.
THE COMMISSION AND EU GOVERNMENTS
* Make national corporate insolvency laws more similar, notably in the ranking of claims and insolvency triggers or the rules for financial collateral and settlement.
* Harmonise listing requirements across European stock exchanges to cut listing costs and make equity and bond financing more attractive, and examine how to improve access to market information.
* Develop simple and cost-effective cross-border investment and savings products for retail investors.
EU GOVERNMENTS
* Provide national tax incentives for companies to raise capital through shares rather than debt. The bias now, because of tax breaks, is towards raising funds through debt.
* Support investment in securities by adjusting the way personal income tax systems treat long-term retail investment products and capital gains and losses.
* Educate citizens about investment options available on capital markets as an alternative to keeping savings in bank deposits.
THE FINANCE INDUSTRY
* Offer easy-to-use and secure digital interfaces for all retail clients to access financial services across the EU.
(Reporting by Jan Strupczewski; Editing by Kevin Liffey)
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