The European Securities and Markets Authority, said differences in regulatory powers held by entities such as the UK’s Financial Services Authority meant they could not respond to crises in a co-ordinated fashion. 

The report mapped contingency measures across Europe’s regulatory authorities as part of plans to achieve increased supervisory convergence. Jean Guill, member of the management board of ESMA and chair of its review panel, said the publication revealed the importance of creating a common legal basis to enable national supervisors to respond in concert at times of crisis. He said: “To enable both ESMA and national supervisors to effectively fulfil their functions and roles, should crisis arise, further steps seems to be necessary in order to vest competent authorities with suitable tools to address in a common way future situations that constitution or might lead to a crisis.”

Examples of functions that national regulatory bodies should have, according to ESMA, include the power to shut down the market; to suspend the redemption and repurchase of UCITS-units; and deal with market insolvencies and the failure of large market traders, clearing houses or settlement systems. 

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