European Securities and Markets Authority (ESMA)

Retired CNN executive producer Donna Krache once told my journalism class that the most essential question a producer can ask is, "Why should I care?" Why should the person watching my piece care about it? Most high-end productions miss the mark when answering this question. Read my latest on the why:

Supporting Europe's transition to a more sustainable economy remains a high priority, and even more so amid increasing geopolitical complexity. I had the pleasure of speaking on a panel at Les Rencontres de l’IFD 2026 – The Institut de la Finance Durable, focusing on Reconciling transition and Sovereignty right after an inspiring and clear call for action speech from Enrico Letta . Europe’s green transition should be seen as an essential component of its strategic autonomy. In this respect, the EU sustainable finance framework plays a crucial role. At ESMA, our objective is clear: to contribute to a regulatory framework that is more coherent, more effective and easier for market participants to navigate. Simplification is necessary, but it must not come at the expense of our climate ambition. Not only because it matters for our planet, but also because, over the long term, decarbonisation strengthens energy security, economic resilience. A clear, stable and predictable framework is essential for investors and market participants to invest with confidence, and for Europe to mobilise the scale of investment needed for the climate transition. This is the direction we are supporting, together with national competent authorities across the EU. Many thanks to all the panelists, and to our moderator Isabelle Gounnin-Levy, for a timely and insightful discussion. #SustainableFinance #GreenDeal #GreenTransition #LesRencontresIFD Jean-Jacques Barbéris Pascal Canfin Enrico Letta Sebastien Raspiller Sébastien Windsor

CJEU | Consumer credit pricing & transparency — interest cannot be charged on “credit costs” (incl. insurance premium) In its 23 April 2026 judgment in Case C‑744/24, P.W. v Bank Polska Kasa Opieki (Seventh Chamber), the Court of Justice clarifies the perimeter of the “taux débiteur” under Directive 2008/48/EC: it is the annual rate “appliqué … au montant de crédit prélevé (drawn down)”, i.e., to amounts actually made available to the consumer, not to amounts earmarked to pay credit-related costs. The case concerned a loan where part of the nominal “credit” financed an insurance premium; the bank applied interest to the disbursed amount plus that premium. The Court treated the premium as part of the “coût total du crédit pour le consommateur” where the (nominally “voluntary”) insurance was required to obtain the loan on the offered terms (“… requise pour l’obtention du prêt aux conditions prévues par l’offre”). Key holding (operative impact): Article 3(g) and (j), read with Article 10(2) of Directive 2008/48, precludes contractual clauses applying the borrowing rate not only to the total amount of credit but also to sums allocated to pay credit costs. In the Court’s own words: “il s’oppose à l’inclusion, dans les contrats de crédit aux consommateurs, de clauses prévoyant l’application du taux d’intérêt, non seulement sur le montant total du crédit, mais également sur des sommes affectées au paiement de coûts liés à ce crédit …”. Practically, this pushes lenders to separate (i) amounts “drawn down” from (ii) total credit costs (fees/insurance) and avoid “interest-on-costs” mechanics—while still allowing pricing to be structured transparently (e.g., via the borrowing rate applied to the drawn amount). Notably, once the Court found the practice unlawful, it considered there was no need to answer the second transparency question. #CJEU #ConsumerCredit #Directive2008_48 #APR #FinancialServicesLaw #BankingLaw [123 | PDF]

A recent decision of the Geneva Court of Justice (ACJC/151/2026) provides a noteworthy clarification on the scope of a bank’s duty of care vis-à-vis qualified investors. The case concerned losses incurred following equity investments, where the client alleged insufficient advisory support and monitoring by the bank. https://lnkd.in/dVCPC2Bk The Court adopted a restrictive approach, confirming that, in both advisory and execution-only relationships, banks are under no general obligation to monitor portfolios or proactively inform clients of adverse market developments. This conclusion was driven by the client’s status as a qualified and professionally experienced investor, combined with contractual provisions explicitly assigning responsibility for investment oversight to the client. Importantly, the Court also rejected the application of the “special trust” (exceptional circumstances) doctrine. It emphasized that such corrective mechanisms cannot be readily invoked where the client possesses sufficient financial expertise. In parallel, the decision reinforces the evidentiary and substantive significance of complaint clauses, which may operate as a presumption of ratification in the absence of timely objections. From a broader perspective, the judgment illustrates a continued trend toward a differentiated and contractualized standard of care in Swiss banking law. For practitioners, it underscores the centrality of client classification, documentation, and contractual allocation of responsibilities—while serving as a reminder that qualified investor status entails not only privileges, but also materially reduced legal protection.

Cryptoasset service providers (CASPs) are rapidly evolving beyond their original roles as exchanges and custodians into vertically integrated financial intermediaries. The largest platforms now combine trading, lending, derivatives, and yield-generating products within a single entity, effectively operating as multifunction crypto intermediaries (MCIs). This structural shift mirrors the functions traditionally performed by banks and prime brokers, but without comparable prudential safeguards. At the core of this transformation is the emergence of “earn” and yield products that economically resemble deposit-taking. In many cases, users transfer ownership of their cryptoassets to the platform, which then deploys them across lending, market-making, or proprietary strategies. These arrangements create short-term, redeemable liabilities on the platform’s balance sheet, while assets are often longer-term or less liquid—introducing classic maturity and liquidity mismatches. MCIs also engage in credit and collateral transformation at scale. Margin lending, leveraged derivatives, and rehypothecation of assets amplify both returns and vulnerabilities. The high volatility and correlation of cryptoassets further exacerbate these risks, increasing the likelihood of cascading liquidations during periods of stress. Episodes such as the Celsius collapse in 2022 or the crypto market flash crash in October 2025 illustrate how quickly confidence shocks can propagate through interconnected platforms. A key concern is the opacity of these institutions. Many large MCIs do not publish detailed financial statements, making it difficult to assess their balance sheet exposures, risk management practices, or interconnections with traditional finance. At the same time, their growing links to banks, asset managers, and institutional investors raise the stakes: disruptions are no longer confined to the crypto ecosystem. ⚠️ Important takeaway: The rapid expansion of crypto intermediation without commensurate regulation creates vulnerabilities analogous to pre-crisis shadow banking. Ignoring these parallels risks repeating familiar patterns—only in a more opaque and globally fragmented environment. From a policy perspective, the challenge is clear but complex. A combination of entity-based and activity-based regulation appears necessary to address the hybrid nature of MCIs. This includes capital and liquidity requirements, enhanced disclosure standards, and stronger cross-border supervisory coordination. As crypto intermediation continues to scale, aligning risk with regulation will be critical to safeguarding both market integrity and financial stability. Full paper: Cryptoasset service providers as financial intermediaries: risks and policy approaches (BIS, April 2026) https://lnkd.in/df7MkGJa

The International Capital Market Association has just published its Quarterly Report (Q2 2026), offering a comprehensive and timely perspective on structural developments in global debt capital markets. https://lnkd.in/dG5mxFgX From a regulatory standpoint, several themes merit particular attention: 1. Tokenisation as a structural shift in market infrastructure The report frames tokenisation not as incremental innovation, but as a fundamental redesign of capital market infrastructure. The transition toward “assets on chain” and “cash on chain” raises core legal questions around the nature of securities, settlement finality, custody, and applicable jurisdiction. The emphasis on standardisation, interoperability, and regulatory clarity is well placed and reflects the scale of the transformation underway. 2. Market Integration and Supervision Package – ambition vs. institutional balance The discussion of MISP highlights the EU’s renewed ambition to achieve a genuinely integrated capital market. However, two aspects deserve critical reflection: The proposed expansion of supervisory convergence tools (including broader use of “no action letters” and Commission intervention in technical standards) may enhance flexibility, but also risks increasing legal uncertainty and discretionary regulatory intervention. The evolving role of ESMA, particularly in asset management oversight, raises legitimate concerns regarding the balance between centralisation and the preservation of national supervisory expertise. The risk of a gradual shift toward de facto centralised supervision without corresponding accountability frameworks should not be underestimated. 3. Systemic risk and the repo market – a data problem as much as a policy problem The findings from the UK gilt market and the System-Wide Exploratory Scenario underscore a critical point: systemic risk increasingly arises from the interaction of market participants rather than from individual institutions. The report rightly identifies data gaps—particularly in relation to leverage and non-bank financial intermediaries—as a key constraint on effective supervision. This reinforces the need for a more granular, system-wide, and data-driven regulatory approach. 4. Securitisation – between over-regulation and under-utilisation The report contributes to the ongoing reassessment of securitisation in Europe. While post-crisis reforms have significantly strengthened the framework, the current regime appears operationally burdensome. Excessive reporting and due diligence requirements may be inhibiting market development without proportionate gains in stability. A recalibration toward a more efficient, yet still robust, regime seems both necessary and timely. Overall, the report illustrates a broader transition: from regulating institutions and products toward regulating systems, infrastructures, and interconnections. #CapitalMarkets #FinancialRegulation #Tokenisation