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The EBF welcomes the opportunity to respond to ESMAs Call for Evidence on the European Commission’s mandate on certain aspects relating to retail investor protection.
The EBF welcomes a review of the information requirements since the current regime is too complex and not calibrated to clients’ needs. We support easing requirements for professional and eligible counterparties as well as knowledgeable retail investors through changing opt-up criteria. We agree with ESMA it is very important to ensure that the disclosure requirements are technology neutral so that it is easy for clients to understand and access the information also in an online environment.
Furthermore, there should be horizontal alignment between legislation to ensure transparency and comparability, especially uniform information for similar investment products and services.
Discrepancies in the sustainability regime in MiFID II and SFDR should be addressednotably regarding reporting frequency of individual portfolio management. There is also great concerns relating to the overlapping implementation period of the SFDR level 2 requirements (1 jan 2023) and MiFID II rules on suitability assessment (3 aug and 22 nov 2022). The EBF strongly support postponing the MiFID II level 2 requirements until 1 jan 2023.
The benefits of an open finance approach in the field of retail investment will strongly depend on how an open finance policy is implemented in the EU and whether the initiative is limited to data that is now held by banks instead of all the data that is useful in the financial ecosystem, including data from other sectors.
We would like to to underline that disclosures do not automatically lead to increased investor protection. Financial literacy remains a key feature to improve retail investors’ access to capital markets. x