The European Securities and Markets Authority (ESMA), the EU’s financial market regulator and supervisor, has on 28 September published its work programme for 2024. In an economic context marked by high inflation, heightened geopolitical tensions and rapid technological changes, ESMA will ensure close market and risk monitoring and support the effective implementation of the European regulatory framework related to the digital and sustainability transitions. By fostering effective regulation and supervision of the European capital markets, ESMA contributes to addressing the challenges faced by the EU and its citizens. Continue reading…

by Steven Maijoor

It is a pleasure to be back in London. Back at the Bank of England. Back at the ‘Old Lady of Threadneedle Street’. The Old Lady that battles inflation, safeguards financial stability and firmly protects… the gold in her vaults. Gold that lies right here, under our feet. 400 000 bars of gold, to be precise. Today, I was invited to talk about a new type of gold – or, at least, to some it is. I am referring to crypto-assets. Something the Financial Stability Board has consistently been monitoring since 2018. For a long time, crypto-assets were an experiment on the fringes of the financial system. No shop owner would accept bits and bytes instead of cash or card. But soon, certain illicit online marketplaces got wind of this new digital asset: selling illegal services or products online had never been this easy. So, regulators and law enforcement agencies sprang into action and took coordinated action to combat money laundering. Nonetheless, in those early days, chances were very slim that someone had heard of bitcoin or ether, let alone owned them. For a long time, crypto assets were an experiment on the fringes of the financial system. But they have gone through rapid and turbulent developments since then and now even pose a potential risk to financial stability. That is why all over the world, new regulation has been introduced at a national level to better supervise crypto markets and activities. To promote consistency in those regulations and supervisory practices, the Financial Stability Board has developed a global framework of recommendations. While reducing the likelihood of regulatory arbitrage, this framework offers national regulators sufficient flexibility to take more incisive action, for example if warranted by emerging risks to monetary stability. Continue reading…

The three European Supervisory Authorities (EBA, EIOPA and ESMA – ESAs) have issued their Autumn 2023 Joint Committee Report on risks and vulnerabilities in the EU financial system. The Report underlines the continued high economic uncertainty. The ESAs warn national supervisors of the financial stability risks stemming from the heightened uncertainty, and call for vigilance from all financial market participants. Continue reading…

by Caroline Raat

“Giving Voice to Values” (GVV) by dr. M.C. Gentile is a popular, but theoretically not well-founded educational program and approach to values-driven leadership development in business education and the workplace. Rather than focusing on ethical analysis and philosophical reasoning, GVV concentrates on ethical implementation, addressing the question: “How can I express my values effectively in a professional setting?” The foundation of GVV is the premise that most individuals already know what is right, but they struggle with how to express and act on their values in the workplace, especially when faced with opposition or pressure. It is designed to help individuals develop the skills, confidence, and habit of voicing and enacting their values. In many ways, GVV is a glorified assertiveness training, based on pseudoscience.
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The European Commission has re-imposed a fine of around €376.36 million on Intel for a previously established abuse of dominant position in the market for computer chips called x86 central processing units (‘CPUs’). Intel engaged in a series of anticompetitive practices aimed at excluding competitors from the relevant market in breach of EU antitrust rules. In 2009, the Commission fined Intel €1.06 billion after finding that Intel abused its dominant position in the market for x86 CPUs. The Commission decision was based on findings that Intel had engaged in two specific forms of illegal practices by: (i) giving wholly or partially hidden rebates to computer manufacturers on condition that they bought all, or almost all, their x86 CPUs from Intel (so-called ‘conditional rebates’); and (ii) paying computer manufacturers to halt or delay the launch of specific products containing competitors’ x86 CPUs and to limit the sales channels available to these products (so-called ‘naked restrictions’). Continue reading…

The European Central Bank (ECB) has published the results of its second economy-wide climate stress test. The results show that the best way to achieve a net-zero economy for firms, households and banks in the euro area is to accelerate the green transition to a rate that is faster than under current policies. “We need more decisive policies to ensure a speedier transition towards a net-zero economy in line with the goals of the Paris Agreement. Moving at the current pace will push up risks and costs for the economy and financial system. There is a clear need for speed on the road to Paris,” says ECB Vice-President Luis de Guindos. Continue reading…

The European Securities and Markets Authority (ESMA), the EU’s financial markets regulator and supervisor, has recently published the second Trends, Risks and Vulnerabilities (TRV) Report of 2023. ESMA sees that financial markets are adapting to the new economic environment of durably higher inflation and interest rates, however risks remain high in ESMA’s remit. Markets are set to remain very sensitive to potential deteriorations in economic fundamentals or risks in the financial sector. Continue reading…

Yesterday, the European Commission adopted a key package of initiatives to reduce tax compliance costs for large, cross-border businesses in the European Union. The proposal, called “Business in Europe: Framework for Income Taxation” (BEFIT), will make life easier for both businesses and tax authorities by introducing a new, single set of rules to determine the tax base of groups of companies. This will reduce compliance costs for large businesses who operate in more than one Member State and make it easier for national tax authorities to determine which taxes are rightly due. The new, simpler rules could reduce tax compliance costs for businesses operating in the EU by up to 65%. Continue reading…

The European Commission welcomed the recent adoption by the Council of further targeted restrictive measures arising from Russia’s illegal invasion of Ukraine, and in response to Belarus’s involvement in the aggression. In particular, the new measures create a closer alignment of EU sanctions targeting Russia and Belarus and will help to ensure that Russian sanctions cannot be circumvented through Belarus. Continue reading…

The European Supervisory Authorities (EBA, EIOPA and ESMA – ESAs) has recently published their Progress Reports on Greenwashing in the financial sector. See EBA, EIOPA, and ESMA reports. In these reports, the ESAs put forward a common high-level understanding of greenwashing applicable to market participants across their respective remits – banking, insurance and pensions and financial markets. Continue reading…