MEPs from ECON have backed the Commission’s proposal for a proportionate regime for smaller, non-systemic investment firms. The proposals suggest that firms’ whose total average monthly assets over a 12 month period exceed €30 bn should be subject to the current capital requirements for banks, but that smaller firms can either be regulated at that level if they pose a systemic risk or else may benefit from proportionate rules on capital requirements and supervision. ECON has also voted through changes that tighten the equivalence rules for third country investment firms, so that they can provide services of systemic importance only after detailed assessment by the Commission and subject to monitoring by ESMA. Certain services would also require third country firms to set up a subsidiary in the EU.
The Council now needs to reach its common stance and then the trilogue negotiations on the proposal can begin.