The Finnish Government has reviewed the EU’s proposed reform of the financial supervisory system and taken a wise stand. According to the Government, strengthening the European supervisory system is advisable, but its costs need to stay at a reasonable level. The Government’s stand is a response to the European Commission’s proposal to strengthen supervision in the European financial markets, given earlier this autumn.
The Government, similarly to the financial sector, thinks that the Commission’s proposal does not entirely help diminish the regulatory burden of small organisations. According to the Government, it would be justifiable to allow national authorities to supervise domestic financial products in the future as well.
The Commission also proposes that trade reporting should be transferred from national authorities to the European Supervisory Authorities. “The costs of collecting supervisory data incurred to financial companies are a key aspect of these reforms”, explains adviser Elina Kamppi from Finance Finland.
“Every year, companies collect huge amounts of data for financial authorities. Implementing changes to these practices is thus very expensive. If the practices themselves remain unchanged, it is of little difference to the financial sector whether the data is collected by a European or a national authority”, continues Kamppi.
Both the Finnish Government and the financial sector are critical of the financing model employed in the proposed supervisory system, but the financial sector takes a stricter attitude and opposes the reform of the financing model. According to the financial sector’s view, national organisations should not have to pay overlapping fees or do overlapping administrative work.
The EU’s system of financial supervision consists of the three European Supervisory Authorities (ESAs): the European Banking Authority (EBA), the European Insurance and Occupational Pensions Authority (EIOPA) and the European Securities and Markets Authority (ESMA).