The European Commission has kicked off its project to create a Capital Markets Union (CMU) for all 28 EU Member States with a first orientation debate at the College of Commissioners. The European Commissioner for Financial Services, Jonathan Hill, has today, 18th of February 2015, launched a green paper on Capital Markets Union. This is a multi-pronged effort to ease money flow to business and address Europe’s over-reliance on bank finance. These could include reviving market appetite for securitised bundles of loans, cutting red tape for businesses raising equity or debt, and perhaps better coordinating tax and insolvency rules underpinning markets. Capital Markets Union could deliver an efficiency gain of €60 billion to businesses across the EU, according to the European Parliament.
The CMU is one of the flagship projects of this Commission and ties in with the ambition to boost jobs and growth in the EU. It is designed to help businesses to tap into diverse sources of capital from anywhere in the EU and offer investors and savers additional opportunities to put their money to work. It aims to create a single market for capital for all 28 Member States by removing barriers to cross-border investment and lower costs of funding within the EU. Well-functioning capital markets will also facilitate the mobilisation of private financing in the context of the Investment Plan for Europe.