The European Commission has launched its consultation on creating a unified capital market across the continent, saying successful implementation could provide as much as €90 billion of additional investment in EU companies.
Jonathan Hill, EU Commissioner responsible for financial stability, financial services and capital markets union, said: “The direction we need to take is clear: to build a single market for capital from the bottom up, identifying barriers and knocking them down one by one. Capital Markets Union is about unlocking liquidity that is abundant, but currently frozen, and putting it to work in support of Europe's businesses, and particularly SMEs.”
A green paper published today outlines the key objectives the Commission wants to achieve with Capital Markets Union (CMU) and the consultation will be used to identify the actions needed to achieve these goals.
According to the document, CMU should improve access to finance for businesses across Europe, remove barriers to cross-border investment, diversify economic funding and help SMEs to raise finance as easily as larger firms.
Magnus Billing, senior vice president at Nasdaq, which operates several markets in the Nordic region, said improving prospects for SME’s is particularly important to achieving an effective CMU.
“We're pleased to see that the green paper on the Capital Markets Union highlights the need for an improved ecosystem for SMEs, in order to further enhance European growth,” he said.
“It is our understanding that the paper focuses on removing any legal or other obstacles to an integrated Capital Markets Union. We'd like to underline the need for ensuring that local financial markets and ecosystems work efficiently, adapted to the specific challenges of SMEs in all corners of Europe. There is also a need for adequate incentives to foster investments, but also to simplify the life of listed companies.”
Interested parties are invited to submit their responses to the consultation by 13 May. The Commission will then use the responses to engage with MEPs and member states to get their views on how best to achieve CMU. An action plan is then due to be published in the second half of 2015.