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AFME has been involved in several CMU initiatives during this period, including the FinTech and Sustainable Finance Action Plans and related proposals, the review of the European Supervisory Authorities, the review of the regulatory framework for investment firms, reforms to insolvency frameworks and the NPLs Action Plan. AFME was also active in workstreams in the post trade area and on the implementation of the new Securitisation Regulation, among others.
AFME have worked with members to identify and put forward our CMU priorities for the next five years and have maintained a constructive dialogue with the European Commission and authorities across Europe. Recent engagements include meetings and workshops on the CMU 2.0 strategy. AFME has also met with the NextCMU High Level Group established by the finance ministries of Germany, France and the Netherlands to report on recommendations for deepening the CMU.
The CMU project is set to remain a priority for the next EU legislative cycle and AFME will seek to maintain AFME’s position as a key interlocutor, supporting an ambitious agenda to expand the size, capacity, depth and level of integration of the EU’s capital markets. AFME will ensure that AFME’s work on CMU is well integrated with other workstreams such as Brexit and the MiFID 2/R review.
AFME will also continue to highlight the complementary nature of Banking and Capital Markets Unions in strengthening the EU financial system and promoting integration, showcasing how, via increased cross-country risk sharing, more developed capital markets can help overcome the political deadlock currently preventing the Banking Union project from moving forward.
In the run up to the UK’s departure from the EU AFME has continued to support members in their Brexit preparations to address issues which may cause disruption within the financial sector. This has included senior level engagement with the European Commission, ECB, ESAs and finance ministries as well as regulators across the EU27 and the UK, covering issues arising in a no-deal Brexit scenario such as equivalence for UK CCPs, supervisory cooperation, data transfers, continued servicing of contracts and challenges arising out of the MiFID trading obligations for shares and derivatives.
AFME have had dialogue across Member States where AFME made the case for, and inputted into, national contingency legislation to enable certain services to continue in the event of a no deal scenario. AFME have successfully highlighted no-deal risks and obtained mitigation in areas such as temporary equivalence for UK CCPs, improved clarity on the scope of the EU share trading obligation and the introduction of national contingency measures in most member states, all of which would lessen the impact of a no deal Brexit.
Supporting members’ Brexit planning has been a key area of focus, through considering implications across our committees, tracking EU27 national contingency measures and monitoring wider developments. AFME have continued to work with UK government and regulators in relation to the “onshoring” legislation to transpose EU law into the UK legal framework and the Temporary Permissions Regime.
While the outcome remains uncertain, AFME will support members throughout the process, including further developing our positioning on the future relationship between the EU and the UK, and continuing to address developments in the EU’s third country regimes.