On 18 March 2016, the European Commission published a speech by Jonathan Hill, the European Commissioner for Financial Stability, Financial Services and Capital Markets Union, on the Commission's work on the capital markets union (CMU). Points of interest in the speech include:
- This year, the Commission will start its work to strenghten venture capital markets by amending existing legislation governing venture capital funds, in order to build up scale, diversity and choice. It will look to see how it can use public money to attract private investment, with a pan-European venture capital fund. The Commission is keen to encourage the development of crowd-funding as a source of financing for start-ups, and it also wants to see whether it can encourage the development of industry-led business growth funds, in order to support equity in small and medium-sized enterprises (SMEs).
- The Commission has made a proposal to restart Europe's securitisation markets, in order to free up more bank lending to smaller companies. Its proposal sets out criteria for simple, transparent and standardised securitisation, with reduced bank capital requirements for securitisations that qualify. The Council of the EU has reached an agreement on this "in record time", as governments recognise the importance of freeing up the supply of bank lending. The onus is now on the European Parliament to take this forward.
- To deepen financial markets for companies of all sizes, the Commission is working to remove barriers to cross-border investment. To give investors more choice, it wants to remove the passport system for investment funds, so that they can offer their services more easily and compete in different markets. This year, the Commission will launch a consultation to identify the main barriers to funds operating in countries other than their own.