EU Proposes Enhanced Regulatory Powers for Market Oversight

According to PANews, the European Union's executive body has unveiled a proposal to transfer more regulatory and enforcement authority to its market oversight agency, sparking a debate among national regulators about ceding power to Brussels. The proposal, announced on Thursday, suggests granting the Paris-based European Securities and Markets Authority (ESMA) new powers over significant clearinghouses, central securities depositories, and trading venues. Less than a year after introducing a national regulatory framework for cryptocurrency companies, these entities and pan-European market operators are now included under ESMA's jurisdiction. The centralization of most market regulatory powers within the EU requires approval from both the European Parliament and the Council of Member States, with some member countries strongly opposing the move. The proposal aims to bolster ESMA's authority and resources, establishing a board of five independent members with terms of up to five years. The EU budget will cover preparatory costs, while trading venues, central securities depositories, and crypto asset service providers will bear ongoing expenses. To streamline European market operations, the European Commission plans to amend legislation, limiting member states from imposing additional requirements on securities issuers, simplifying licensing processes to enhance cross-border central securities depository services, and integrating distributed ledger technology into the regulatory framework. Negotiations on this comprehensive plan are set to begin in January, with Cyprus assuming the rotating presidency of the EU Council at that time.