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Experience to date shows insignificant cross-border trade among consumers, and lenders show little appetite to operate in this way. Yet the Commission appears keen to promote this path, regardless of the lack of demand. The CML's concern is that this could impose an onerous, costly, and bureaucratic regulatory regime without ever achieving the desired result.
By contrast, there is interest among internationally active lenders to operate in new markets. CML believes that the Commission should therefore focus on removing barriers that lenders face in moving into new national markets, and so open up a wider range of lenders operating within them.
Most worryingly, the CML believes that London Economics has seriously underestimated the costs of implementing a European regulatory regime, in which case the negative effect would be even more pronounced.