20 May 2015 — Consultation Response

FEE comments on the Public Consultation on Building a Capital Markets Union (CMU)

With the Green Paper on CMU, the Commission looks for input on the possible measures needed to create a true single market for capital.

The European accounting profession can be a constructive partner in developing a CMU, as accounting and auditing are directed towards achieving more efficient, transparent and trustworthy corporate reporting, thus allowing for better informed investment decisions.

Based on our experience, our response includes the following areas where further action by the Commission could facilitate the better functioning of European capital markets:

  • Ensuring better flow of reliable and understandable information to market participants and potential investors.
  • Using a common accounting framework would provide significant value for SMEs that intend to access pan-European funding and trading platforms. The current patchwork of accounting frameworks based on the EU Accounting Directive cannot serve as the basis for such a single framework.
  • Proportionally applying IFRS to all companies listed on pan-European funding and trading platforms. This could be achieved through ongoing simplification of recognition and measurement requirements of IFRS, and reduced disclosures through the completion of the IASB’s Disclosure Initiative.
  • Creating a more efficient taxation regime, and where the EU’s competencies allow, greater coordination and information sharing between Member States.
  • Further harmonising corporate governance and company law and greater transparency regarding insolvency proceedings.
  • Enhancing the role of the European Supervisory Authorities, to reflect the increased harmonisation and cross border nature of European capital markets.

Related files:

FEE comment letter on the Public Consultation on Building a Capital Markets Union

More Information:

CMU website including infographics

EC Consultation on the CMU

FEE comments on the Review of the Prospectus Directive

FEE comments on the EC Green Paper on Long-Term Financing of the European Economy (June 2013)