Today’s explicit support for the work of CESR, and the key list of recommendations for further supervisory convergence, represent an important political step forward by EU Member States, following on from the adoption of the Stockholm Resolution which introduced the ‘Lamfalussy’ legislative approach for financial services in March 2001 and established CESR.
In particular, CESR acknowledges the commitment by Ministers to monitor the convergence of supervisory powers of EU securities supervisors and welcomes the recognition that equivalence of powers amongst national supervisors is the necessary precondition to any form of cooperation between authorities. The effective convergence of supervisory powers will contribute to greater investor protection by ensuring that investors can enjoy the same protections when buying cross border.
In line with the key recommendations of the Financial Services Committee (FSC) report on Financial Supervision and the White paper of the European Commission on Financial Services Policy, CESR will:
- establish a mediation mechanism in the second half of 2006;
- develop in 2006 and 2007, IT data sharing arrangements for the implementation of the MiFID;
- conduct in 2007, a pilot study on the delegation of powers under the Prospectus Directive;
- foster a common supervisory culture which encourages exchanges of staff and develops joint training initiatives;
- monitor on a more regular basis the issues related to Home/Host cooperation in the implementation of Financial Services Action Plan (FSAP) directives in the field of securities;
- report to the FSC on progress achieved in supervisory convergence and flag any outstanding obstacles;
- contribute to the ongoing assessment by the FSC of challenges arising from the market developments.