Forget the European financial transaction tax or MiFID II, the extension of the European Central Bank's supervisory powers being pushed through Brussels has stolen first place in Europe's growing regulatory queue.
As the Council of the European Union finalises its position on MiFID II - which could emerge as early as this month - its expected implementation date seems to slide forward, stretching past the initial 2014 goal, and could be as far off as 2018, experts have warned.
Speaking at an industry event late last month, the UK's lead EU financial services policy advisor, Dr David P. Doyle, warned a small band of industry members another regulatory change had slipped by unawares. In less than a year, the ECB will have wildly expanded supervisory powers over euro-zone banks, which will even affect London banks with regional branches or subsidiaries.
Doyle said a growing sense of fervour in Brussels that any future failure of a European bank would cause great social unrest had precipitated the swift development of these new powers, which will likely come into force in March.
So this is why the keenly awaited MiFID II and its attendant regulation have popped out the back for a cigarette break.
"MiFID II, MiFIR, insolvency II and other financial regulation simply are not a priority at the moment and are taking a back seat in the interests of ensuring we have a robust recovery and resolution regime for euro-zone banks in place as soon as possible," he said.
But surely this has nothing to do with me? Think again…
European policymakers have effectively repositioned the ECB as an integral part of the European financial regulatory environment. The bank will have "massive" direct supervisory powers to intervene across borders, act without liaising with the national regulator, replace senior management, fire the board of directors and force banks to sell-off assets in the interests of recovery.
But, regardless of the direct impact of the changes, it does beg the question: how many flash crashes and rogue algos would Europe need to direct the speed and urgency summoned by Brussels for the ECB reforms towards MiFID II?
The on-going delays plaguing MiFID II development may not abate, as the trialogue stage - when the Parliament and Council hammer out a final version - could see significant debate about key issues such as which waivers to include, and the rules governing cooperation between clearing houses and exchanges.
Given the scope of these changes, a potential MiFID II implementation date of 2018 seems far more plausible, even optimistic.