Who has never dreamed of having all the information they needed in a single click? The European Commission’s future one-stop shop intends to fulfil this wish
Continuing the implementation of its Capital Markets Union, the European Commission in 2021 proposed a new set of measures aimed at improving “the ability of companies to raise capital across the EU and ensure that Europeans get the best deals for their savings and investments”*. In addition to the amendment of existing texts, the principle of a single access point for investors was introduced. The European Single Access Point (ESAP) initiative was launched.
The objective of the ESAP is to provide the entire EU with access to information on the activities or products provided by entities where such information relates to financial markets, financial services or sustainable finance. The ESAP will create a single point from which all these data can be accessed, thus facilitating their consultation, comparison and therefore decision-making. The targeted information is information already subject to a disclosure obligation. However, in certain circumstances, information could be transmitted on a voluntary basis.
The ESAP initiative builds on two other European Commission (EC) programmes: its commitment to the green transition of the EU economy1 and its digital financing strategy2.
It is hard to keep track of the number of European directives/regulations incorporating a disclosure obligation (the EC cites 200 obligations affecting the financial markets3) and the forthcoming texts are unlikely to reverse the trend.
It is therefore not the scarcity of information that poses a concern, but its access. In fact, according to the EC, 17% of this data is transmitted to “official collectors” and out of the remaining 83%, only half must be available on the website of the entity subject to the obligation4.
The research difficulties resulting from this scattered access were seen as a major obstacle to the implementation of the Capital Markets Union (CMU), particularly in terms of economic support and financing of the green and digital transition. How can I make investment choices easily if the information is not centralised?
What data are concerned, and for whom?
Not all published information is intended to be on the ESAP (for example, information that is frequently updated or must be promptly made public will remain accessible only via the current channel). The EC finally adopted 16 directives and 21 regulations5. Although they will be of a variety of types (concerning products, entities and infrastructure), it is clear that the ESAP primarily targets ESG6 data to promote sustainable finance.
Access will be open to everyone and most often free of charge. The general public, professionals, NGOs, regulators, consumer associations, academics, public authorities, data providers, etc. will be able to access this information, barring exceptional circumstances, for 10 years. In practical terms, the ESAP should have all the ingredients to offer easy access to information: a user-friendly, multi-language interface, API7, multiple search criteria, downloads, data extraction formats that are open and widely used, etc.
Quantity… But above all, quality
However, it is not a matter of simply grouping the scattered information into one place. The quality/accuracy of the information and integrity/credibility of the source will be essential for the ESAP to be considered a reference point.
Due to its contribution to the smooth functioning of financial markets, the ESMA8 (one of the three European regulators) will be responsible for establishing and operating the ESAP. On this last point, it will act in close cooperation with the other two regulators (the European Banking Authority and the European Insurance and Occupational Pensions Authority).
Regarding the provision of data to the platform, the EC will create a new player, the “collection body”, to serve as a link between the information providers (the “preparers”) and the ESAP. On the list of these collectors, we will find national or European regulators and official mechanisms.
“Preparers” must transmit the information to the “collection bodies” at the time they make it public. Because a variety of types of data are concerned, it is very likely that a “preparer” will also be a user.
The question of “when”?”
First, it is important to know that the information will not be available all at the same time; the EC proposes a provision in three batches. ESG (taxonomy) information and information related to the Transparency Directive or the Prospectus Regulation should be accessible from the outset.
But the most important point is the progress of the legislative project itself. After the Council, which adopted in June 2022 the changes it wished to make to the EC proposal, it is Parliament (EP)’s turn to decide on its positions (in January 2023).
What deadlines will be adopted: a one-year lag compared to the EC proposals (with an end in 2027) or a more staggered timeline (until 2030)? What will be the final list of the texts concerned (and thus the information selected)? The trialogue phase that is launching will be an opportunity for the three bodies to discuss their differences and agree on a compromised text. We will then have the answers to the questions: “what and when”.
The “how” will be provided with the delegated texts, based on the ESMA’s proposals.
*2021 Capital Markets Union package (europa.eu)
1A European Green Deal (europa.eu)
2Digital finance package (europa.eu)
3 EC impact assessment(page 7)
4EC impact assessment (page 9)
5(EC) amended directives and (EC) amended regulations
6 ESG: Environmental, Social and Governance
7API: Application Programming Interface
8 ESMA: European Securities and Markets Authority