The Capital Markets Union (CMU) will be an opportunity if it provides new sources of financing for SMEs, but it must not become a tool to deregulate the financial sector, say leading members of the S&D Group on the action plan for a Capital Markets Union proposed today by the European Commission.
S&D Group spokesperson on economic and monetary affairs, Elisa Ferreira said:
"The Capital Markets Union (CMU) should be seen as an opportunity to harmonise legislation and achieve a common European capital market, serving the needs of the real economy and offering a credible alternative funding opportunity to complement banking financing.
"We support efforts to revamp credit through innovative forms of business financing; simple, transparent and standardised securitisation; harmonising accounting standards for SMEs; measures to support venture capital or building a pan-European covered bond framework, but we will remain vigilant in order to ensure that the CMU does not undermine investor protection and becomes a tool to deregulate the financial sector."
S&D Group spokesperson on this issue, Paul Tang added:
"The Capital Markets Union must serve everyone, and not just capital providers and market traders. It provides an opportunity for everyone, but the burden of proof lies with the Commission. It must show that the old practices are relegated to the past and are not 'relived' in the current proposals.
"Equal access to finance for European SMEs should be a leading principle in the CMU. SMEs in Europe struggle to find banking loans, and often do not have access to capital market. The action plan of the Commission has some important proposals in this light, including a simplification of the prospectus directive and the development of private placement.
"At the same time, the momentum of the CMU should be seized to fix some longstanding obstacles in effective financial regulation, including the fact that national law often favours debt over equity and the completion of the banking union."
