ISLA welcomes the publication of the European Commission’s Competitiveness Compass.
Following much movement at the Commission, this paper signals the start of the EU agenda setting for the new term, at a time when the region faces its own economic challenges, geopolitical tensions, and the arrival of Donald Trump’s administration.
The Compass provides a central framework encompassing previously announced initiatives put forward by President Ursula von der Leyen pointing towards “Sustainable prosperity & competitiveness” by focusing on three key pillars underpinned by a drive toward greater simplification and coordination:
- Closing the innovation gap
- Joint roadmap for decarbonization & competitiveness
- Increasing security & reducing excessive dependencies
Notably, for our sector and members, and with a focus on the competitiveness pillar, the paper underlines the importance of the Savings Investment Union / Capital Markets Union to long-term competitiveness by stating, “the EU must integrate and have deeper and more liquid capital markets as a necessary step to foster greater mobilisation of private sector resources and direct them towards future-oriented growth sectors.” The paper also references the need for the commission to review rules on financial collateral and settlement.
Our manifesto published in 2024 outlines several recommendations fully aligned to this objective and acts as the basis for our EU advocacy efforts.
Our overarching message is that to boost EU competitiveness through vibrant capital markets, Europe should support the demand for the borrowing of securities through a consistent and pragmatic approach to the regulation and legal financial frameworks that may impact market liquidity.
With further details expected in the coming months, ISLA will continue to actively engage with the Commission and other EU policymakers to ensure the important role of securities lending to deep and liquid capital markets, is not undervalued.
ISLA’s full manifesto is available here.
