07 October 2014

IPE: Jonathan Hill to 'deepen single rule book', including solvency rules

The EP should be involved in the drafting of delegated acts, according to Jonathan Hill, who insisted he did not want to “discourage” the development of a Continental pensions market.

Hill, commissioner-designate for financial stability, financial services and capital markets union, faced the Economic and Monetary Affairs Committee (ECON) for a second confirmation hearing after MEPs said he failed to provide concrete answers. He said there could be a need to “deepen the single rule book, where necessary” for financial institutions, with changes potentially needed “around solvency rules”, without explicitly referencing the pensions sector. However, he also said he was “extremely keen” to focus on proportionality of regulation and ensure there was no “excessive” burdens for market participants.

Hill also appeared to accept calls from MEPs for greater parliamentary involvement in level 2 legislative texts, also known as delegated acts, by saying the chamber “clearly” needed to be involved when discussing them. The UK commission nominee stressed the need for the launch of the Capital Markets Union (CMU), calling it one of the most exciting opportunities facing the European executive, and one that could allow small and medium-sized enterprises (SMEs) to attract funding “based on merits, not the country in which they are based”.

Asked about the prospect of ‘too big to fail’ financial institutions, Hill at first only hinted at regulation for parts of the non-banking financial sector, but later gave a firm commitment. “The whole ‘too big to fail’ question can indeed extend beyond banks, and the example you have given us of the CCPs is exactly such an example that we do need to look at,” Hill said. He went on to say that details of a resolution framework for clearing houses, or CCPs, would be published by early next year.

 

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