Markets4Europe: Transforming Europe‘s Capital Markets
Capital markets have the potential to boost the EU economy and deliver tangible, long-term benefits to the EU citizens. The goal of developing and integrating the EU’s financial markets requires reforms at the EU and national government levels as well as coordinated actions by the private sector providing services to capital markets. We are convinced that these efforts will be well worth the resulting benefits in terms of dynamic economic growth, global competitiveness, sustainable development, financial stability and a better distribution of wealth. In this spirit, we issue this call for urgent action to the policymakers of the EU and Member States as well as the financial services industry.
Our Six Key Recommendations are:
- Channelling long-term savings into financing entrepreneurship by enabling private pension funds, insurance companies and other long-term investors to invest in venture capital and equity markets;
- Making cross-border investment as easy and reliable as domestic investment through further harmonisation/alignment of civil law in areas such as insolvency law and securities law to overcome inefficiency and undue complexity and more efficient operational processes for corporate actions, asset segregation and registration;
- Removing tax obstacles to investors and companies, e.g. by simplifying the calculation of the tax base for companies; by preventing double taxation of investors through improved withholding tax relief and refund procedures; by promoting best practices of simplifying tax processes and encouraging special tax regimes for starts-ups and first-time issuers of equity;
- Improving the companies’ direct access to capital markets through regulatory and non-regulatory initiatives that make smaller companies more visible and remove unnecessary regulatory complexity for issuers and investors; and improve companies’ indirect access through a review of the framework for securitisation to allow it to act as a bridge between lending and capital markets;
- Embarking on an EU-wide campaign of financial literacy to educate the current and future generations of investors and entrepreneurs through EU coordination of model curricula, promotion of best practice and training of teachers, in collaboration with private sector and academic experts;
- Strengthening the EU’s international role through a stronger presence in international financial dialogues, new euro-based benchmarks, more convergent supervision in the EU, and better-connected financial centres.