The EU capital market legislative framework has been significantly enriched with the two CMU action plans put forward by the Commission (2015 and 2017), which have now mostly been implemented. However, the general feeling is that much remains to be done to achieve the CMU. EU capital markets have not significantly developed or integrated since the launch of the CMU and frustration has been expressed with the protracted adoption process of the CMU 1.0 actions and the watering down of several measures.

The Commission reaffirmed at the end of 2019 its commitment to the CMU and the Council set policy objectives for deepening the CMU related to the funding of SMEs, retail savers, the removal of structural and legal barriers to capital flows, the support to the transition to sustainable economies and digitalisation. A motion of the European Parliament expressed similar commitments.

A High Level Forum (HLF) was set up in November 2019 by the Commission to propose a new set of policy measures for achieving these objectives. The HLF report published in June 2020 puts forward 17 recommendations, presented as “game-changers” for the CMU, in 4 main areas:

(i) the financing of business; (ii) market infrastructure; (iii) individual investors’ engagement and (iv) obstacles to cross-border investment. Each of these areas contains a certain number of granular legislative and non-legislative measures that are due to be further elaborated by the Commission by the end of 2020. The HLF has moreover emphasized the importance of an upfront commitment of the EU institutions on a precise package of reforms as a key condition of success of the CMU going forward. The HLF also insists on the coherence of the plan which needs to be fully implemented, albeit with a staged approach for the most complex or politically sensitive proposals.

The papers and articles below provide an overall perspective on the CMU. Additional input can be found on the different areas of the CMU (investment funds, SME funding, retail investment, PEPP, market infrastructures, securitisation…) in the recent Eurofi publications (Conference Summaries, Views Magazines, Regulatory Updates).