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The Commission services publish independent study on the ownership rules that apply to audit firms and their consequences on audit market concentration. The study analyses whether changes to the ownership rules of audit firms might help increase the number of international players in the audit market.
At present, the European Statutory Audit Directive requires that auditors hold a majority of the voting rights in an audit firm and control the management board. The study will contribute to DG Internal Market's work on how to improve competition in the audit market.
At present, the audit market for major listed companies is dominated by the Big Four audit firms. The study concludes that an audit firm owned by external investors, instead of auditors, might take more easily the decision to expand into the market of large audits. However, restrictions on access to capital appear to represent only one of several potential barriers to entry.
The report concludes that opening up ownership and control to non-auditors does create the potential for additional specifc conflicts of interest. However, there sees to be no apparent reason why these could not be dealt with through specific legal or regulatory controls, other than ownership restrictions.