Committee on Economic and Monetary Affairs Joint meeting Committee on Budgets CJ16 - BUDG-ECON (Rule 59)
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ECON European Parliament
Follow its sittingsNathalie Berger
Since its introduction, the InvestEU programme has faced high demand for its financial products ranging from loans to equity and guarantees offered directly by our implementing partners, but also indirectly through financial intermediaries to projects and companies of all sizes and all levels of risks, as well as various stages of development from startups to scale-ups. More than 60% of InvestEU guarantee is used to support high-risk products and financial recipients in the form of intermediate equity and quasi-equity investments. Most of this support is provided through financial intermediaries like equity funds investing in innovative startup and scale-up SMEs and also in infrastructure projects. The EIB and other implementing partners like, for example, Invest-NL, also deploy thematic products like equity and quasi-equity, such as the green transition and thematic innovation products.
These products provide direct and quasi-equity investments to companies that are aiming to bridge the financing gaps for high-risk, early-to-market and scale-up of green and innovative technologies across the European Union. Thanks to the Omnibus 2 package that was adopted in December last year, the program has been simplified and reinforced by an EU guarantee of 2.9 billion euros, before there, sorry, therefore increasing the size of the available EU guarantee from 26.2 billion euros to 29.1 billion euros, complemented by additional firepower generated by the combination with the legacy financial instruments and the EFSI guarantee. In June this year, the European Commission and the EIB Group have signed the amended agreement reflecting the adoption of the Omnibus 2. The EIB Group expects the total financial impact of the projects supported through this amendment to be around 70 billion euros until the end of the current MFF, therefore exceeding the 55 billion euros target of the Omnibus 2 package. And InvestEU has also been successful in attracting additional resources, particularly from Member States and other EU programs.
The total EU guarantee available through the InvestEU Fund amounts to 34.9 billion euros. The budget set out in the InvestEU regulation and increased via the Omnibus 2 to 29.1 billion has been strengthened by contributions made through the Member States' national compartments. And we have 10 countries who have contributed with 4.3 billion euros. And by third country contributions from Iceland and Norway, and by considerable top-ups from nine other EU sectoral programs. And I would like to add two observations on the Member States' compartments.
First, Member States' contributions have been overall substantial, and especially when it comes to the Recovery and Resilience Facility. Member States' compartments have proven to be a very efficient way to make good use of the funds provided.
Hence, we have seen some last minute surge in demand from Member States, including Italy, Romania and Greece, which we managed to conclude over the summer break. Second, looking into the Member States compartments from the perspective of the InvestEU programme, the implementation spreads across several implementing partners: the EIF, the EBRD, but also national promotional banks, even if the EIF has been by far the largest partner in this context, thanks to its proactive and strong engagement with the Member States authorities. And clearly, the main beneficiaries of the Member States compartments have been SMEs and small mid-caps, with products supporting them in general, but also more specifically supporting their sustainability and their innovative capacity and digitalization. Just to give some numbers, we have supported 750,000 SMEs, and with the Omnibus 2, we have been able to support 150,000 SMEs.
So, in terms of implementation, InvestEU is delivering on what we have promised. Out of the 34.9 billion euros available European guarantee, 33.5 billion euros, which amounts to almost 96%, have already been allocated to implementing partners through signed guarantee agreements. The implementing partners have already approved 29.2 billion of EU guarantee, which equivalent, which is equivalent to 84% for financing and investment operations, according to the latest data that we have from the end of March 26. Out of the approved European guarantee amount, 64% has already been signed, which amounts to 18.8 billion euros. Importantly, InvestEU has shown strong results in mobilizing additional investment to support the Union's priorities.
Based on the approved operations at the end of December 25, InvestEU is expected to mobilize almost 400 billion of additional public and private investment.
Each euro of guarantee is supporting more than 15 euros in total investment, with around 67% stemming from private sources. I would also very briefly highlight the importance of other pillars of InvestEU, like the InvestEU Advisory Hub as the largest EU-funded advisory program, implementing in partnership with international and financial instruments. And indicate that with the high demand for the InvestEU Advisory Hub support and thanks to the very strong support of the European Parliament in the InvestEU Omnibus legislative process, now the advisory hub operates with a substantial budget envelope which is expected to reach close to 700 million by the end of the current MFF. So, to summarize, the InvestEU program has proven its value added in view of the next MFF.
Its policy-driven governance and structure reflected in its four policy windows is well suited to support the EU's long-term commitment to a green and digital transition as well as the competitiveness and resilience of strategic sectors. It has been designed as a flexible program that can be easily adapted to the new priorities over its lifetime. InvestEU makes an efficient use of EU budget resources. As I mentioned it, for each euro of EU budget set aside with a risk buffer provisioned at 40%, more than 15 euros of investments are being supported. As highlighted in the Draghi report, existing EU financial instruments, including InvestEU, have been effective in supporting investments, but their scale is not commensurate with Europe's investment needs.
Europe must act now with greater ambition, speed, and unity to close its innovation and investment gap.
In this context, InvestEU is a key instrument to mobilize strategic public and private funding, support Europe's competitiveness and accelerate the green and digital transition. A strong and reinforced InvestEU will be essential to deliver on our common European priorities, to strengthen economic resilience and to respond to citizens' expectations for jobs, prosperity and long-term security. And this is why under the European Competitiveness Fund, the ECF, InvestEU instrument, which is the InvestEU Fund successor, which will consist of the budgetary guarantee and financial instruments, will be the preferred mode of implementation. It will help to de-risk private investments and activate capital for growth, ensuring that Europe's innovative start-ups and scale-ups can find funding for growth and stay in Europe in a wide spectrum of EU policy priorities. Thank you very much, Mr. Chair.
Thank you very much, Madam Chair.
Aurore Lalucq
Thank you, Ms. Berger. We have less than 20 minutes left, so I will suggest to group the questions. You have one minute each for the question. And I will start with the members in charge of following InvestEU for EPP, Ms. Benjumea.
Isabel Benjumea Benjumea
Thank you, Chair. I will be speaking in Spanish.
Muchísimas gracias por la muy detallada, muy detallada presentación. Sin lugar a dudas, InvestEU ha sido y sigue siendo un instrumento muy eficaz que cumple con los objetivos para los que ha sido diseñado. Una colaboración público-privada que consigue movilizar inversión privada de empresas y pymes, la que realmente genera riqueza y oportunidades. Un instrumento que fomenta la competitividad, la atracción de inversiones y, por lo tanto, la creación de empleo y oportunidades. InvestEU es un claro caso de éxito y de cumplimiento de objetivos y deberíamos entonces potenciarlo y reforzarlo, tomándolo como modelo para desarrollar prioridades estratégicas y reforzar nuestra capacidad competitiva.
Tengo dos cuestiones concretas. La primera, diversos estudios y análisis muestran cómo una de las debilidades de InvestEU son las diferentes informaciones que hay sobre su verdadero impacto económico y los datos de ejecución final, problemas que se repiten en otros programas de la Unión y que ha denunciado el Tribunal de Cuentas Europeo. ¿Qué posibles mejoras en transparencia y rendición de cuentas se pueden implementar?
En segundo lugar, seguimos teniendo dificultades para financiar el crecimiento de nuestras empresas más prometedoras porque no tienen acceso a capital. Muchas de ellas, muchas scale-ups, acaban saliendo de Europa. ¿Qué podemos hacer para que estas scale-ups tengan acceso a ese capital que necesitan para crecer aquí en Europa y competir a nivel global? Muchas gracias.
Irene Tinagli
Yes, thank you very much. You mentioned that, you know, it's a very efficient instrument. We often pride ourselves about that. An important component is the additionality evaluation. And the thing that I want to ask you is about the ex-post evaluation of additionality, because normally it is evaluated ex-ante.
It's not so clear what kind of ex-post evaluation is made.
Many remarks about that have been raised. I would like to know if the Commission is evaluating, for example, in light of the role within the ECF, the next MFF, to ask implementing partners to provide ex-post additionality evaluations, if so, with which methodology, because it's not that easy to do the evaluation. And one last thing very quickly, on the provisioning and the risk diversification. The risk profile of the portfolio is very important, it determines the provisioning. But as of now, the risk is evaluated around 7 billion and 2.2 billion are kind of offset or abated because of the diversification of the portfolio.
However, it's not so clear how this evaluation has been made, what are the criteria, what are the assumptions for this risk evaluation. The Parliament does not have access to this data and information, so I would like to know if the Commission is ready to disclose, at least in aggregated form, the main product-level assumptions, correlation, sensitivity analysis underlying the risk assessment. Thank you.
Enikő Győri
Thank you. Madam Berger, welcome.
I agree with you that the InvestEU is a good instrument because it's business-oriented, because it concentrates on SMEs and is quite close to real world. It took a while to set it up, two years. It was not easy, but we have a mechanism now that is working. But I'm very, very worried about is the future and the transition to the MFF and how we will be able to maintain this kind of now more or less flexible instrument. My first question would be that what is your opinion on this new structure, on the European Competitiveness Fund issue?
And don't you think that the overly prescriptive nature and centralized system which is implied by the new MFF ideas, so how will it impact the concept of InvestEU and how do you think it will be able to survive? I know the figures, I'm not worried about the figures, but I'm quite worried about the transition, how do you think it can be, we can not have a cliff-edge impact because I'm quite worried for the running programs and how to do that. And my final question is about conditionality. You know that we're going to have a conditionality umbrella above MFF and I find it very hardly compatible with the business-oriented and back-to-real-world impact or concept of InvestEU. So your opinion on conditionality.
Thank you so much.
Bogdan Rzońca
Dziękuję bardzo. Mój komentarz jest taki, mój komentarz jest taki, że jest oczywiste, że program InvestEU jest dobrym programem. Natomiast jest on bardzo głęboko zakorzeniony w promocji zielonej energii i wszystkiego tego, co wiąże się z zieloną energią. Jeśli promujemy jednoznacznie tę zieloną energię, to ignorujemy w pewien sposób miks energetyczny w Unii Europejskiej. Brak tego miksu energetycznego w Unii Europejskiej powoduje, że firmy z Unii Europejskiej uciekają, przenoszą swoją działalność, zwalniają pracowników.
Dowodem na to jest Fundusz Globalizacji.
My na Komisji Budżetowej bardzo często pokazujemy tę sytuację, że firmy z wysokich półek technologicznych po prostu albo upadają w Unii Europejskiej, albo zamykają swoją działalność, albo tracą konkurencyjność względem firm ze Stanów Zjednoczonych czy z Chin. Wobec tego moje pytanie jest takie, czy w dalszym ciągu ten fundusz konkurencyjności nie będzie uwzględniał, nie będzie uwzględniał realiów gospodarczych, tego, tego gospodarczego eurorealizmu, który powoduje, że mamy wielokrotnie droższą energię w Unii niż na innych kontynentach? Dziękuję bardzo.
Aurore Lalucq
Thank you. I think that Ms. Rosso is not, not here anymore. For the Greens, Mr. Nordqvist.
Rasmus Nordqvist
Yes, thank you, and thank you for, for the presentation here. I mean, no discussion about the success. My question is a bit, we've seen the investments within the climate objectives really reaching well beyond the, the minimum target, and this is fantastic and good. I'm just a bit worried with the Omnibus if you see any challenge here to, to do this great performance when it comes to the climate, to reach the climate objectives, if the Omnibus is interfering in, in that transition we see here from InvestEU.
And also how ready you see InvestEU when it comes to new objectives, for example within the circular economy where we see a lot of companies with the need of investment to scale up for for European solutions, but we we see they have difficulties with with actually being valued at at the right level and and reaching the right investment. Thank you.
Damian Boeselager
Yes, I just wanted to ask on the whole question of startups and SMEs, but especially startups. You mentioned that there are instruments there. I was just wondering what you think in general about a startup quota when it comes to InvestEU instruments.
Nathalie Berger
Thank you very much, Mrs. Chair, Madame la Présidente, and many thanks for for these questions.
I see several questions that relate to the power or to the margin of action that we have and that we will have in the context of InvestEU, in the context of the ECF InvestEU, notably with the question of the attribution or the specificity of the attribution to the windows or to the general envelope. In what several MEPs have said, I understand that we need to preserve, or I would say that we need, we will need to be able to preserve the capacity to go beyond the specific elements because otherwise we are going to be very restrained by the thematic labeling of the windows. So that is something that we have observed and we have been able to proceed in the context of InvestEU and that we will need to be able to keep in the context of the ECF and the ECF InvestEU. The transition is going to be very important and what I have said on the capacity to be able to get beyond the very specific labeling will be particularly relevant for the transition.
So we will be able to have the possi- we will need to be able to have the possibility to adapt to the needs notably for what has been raised for SMEs and for startups in order to be able to go beyond the strict labeling. Um you have also asked about the assessment of the impact and and how to improve the transparency of information and what can we do in this regard on this to be able to communicate more detailed information on impact and how what can we do as this is quite technical and I'm in a very new capacity in this position I would propose to pass the floor to my colleague Mr. Marin who will be able to respond on this point.
Antongiulio Marin
Yes thanks a lot. Indeed as for the impact as you know there are a large number of key performance indicators which reflect the impact of the InvestEU in term of economic and also in term of greening and and digital capacity.
The climate target, for example, has been overachieved, we are already at 50%. Now, in terms of evaluation, you know, the regulation foresees a final evaluation at the latest by December 2031 to the Parliament and to the Council. And this, I think, is the opportunity to review more in depth indeed the economic impact that, as you know, for a program like InvestEU, which takes some time to get to the ground, I think we would need some extra year after the investment period, which is ending in 2028, to have such an independent evaluation. So this is, I think, the point in time where we can actually draw a line. You know that the midterm evaluation was already looking at this aspect, but only with the preliminary data.
So, the investment period ending, all the key performance indicators already, of course, reported, and then by 2031 at the very latest, the Parliament will receive a full in-depth assessment, including on the economic impact. Now, as for the, for the, again, for the, for the issue of how we look at the risk and if the provisioning rate, which is set in the regulation at 40%, is at stake. Yes, the budgetary authority receive yearly, of course, the latest in spring, the so-called Article 41(5) report.
This this of course give an indication of where we stand with the expected provisioning before and after the so-called diversification. All the data that we have at the point available are there and the discussion indeed take place with the budgetary authority which can of course ask additional information about the methodology. Just to give you a recall of where we stand. Yeah, the provisioning rate is indeed at stake with a very very very conservative risk assessment which is done with with a confidence level at 95%. This is what we are actually using in in our modeling.
We we based ourselves again very conservative and very strong model and and a very robust risk assessment framework which you know since we have under the the Commission appointed a new a new department led by the Chief Risk Officer so-called CRO are also under review in view of the next MFF. So I think that with this one I gave the information.
Georgios Aftias
Dear colleagues, I will talk to Greek. Θέλω να εγγυηθείτε σήμερα, επειδή μαθαίνω ότι η Τουρκία ενδιαφέρεται για το InvestEU, είναι τρίτη χώρα η οποία απειλεί την Ελλάδα, δηλαδή απειλεί και ευρωπαϊκή χώρα, αντιλαμβάνεστε τι εννοώ. Θέλω να εγγυηθείτε σήμερα ότι μόνο ευρωπαϊκές χώρες θα λαμβάνουν χρήματα από το InvestEU και όχι τρίτες χώρες οι οποίες κάθε τρεις ή πέντε μέρες απειλούν χώρα της Ευρωπαϊκής Ένωσης όπως είναι η πατρίδα μου. Ευχαριστώ θερμά.
Mireia Borrás Pabón
Sí, muchas gracias, señora Berger. InvestEU es una garantía con dinero público para que bancos e inversores financien proyectos que sin ese respaldo, pues no saldrían adelante, ¿no? Usted dice que es una herramienta muy exitosa y ha puesto aquí en valor el enorme reconocimiento de esta herramienta, pero lo cierto es que al cierre del 2025 se habían aprobado 83.900 millones de euros, pero solo se han desembolsado 13.600. De cada 100 euros, básicamente 16.
Anuncian además 19.700 millones para pymes, pero la pregunta importante de todos estos números es: ¿cuánto dinero ha llegado realmente a las pequeñas y medianas empresas? Además el 40% de las garantías se destinan a infraestructuras sujetas a objetivos climáticos, así lo dicen claramente en su informe. Así que yo le pregunto: ¿aquí se financian a los mejores proyectos o únicamente a los que obtienen el sello ideológico de la Comisión del Pacto Verde? Bruselas no puede seguir arruinando la competitividad europea con...
Aurore Lalucq
Excuse me, we have, excuse me, excuse me, we have only two minutes left and there is, there are also other catch-the-eyes, so please go, I mean, just like Mr. Afthiat, he went straight to the point, if you could do the same, it would be much appreciated. So what is your question? Can I finish? My question... Bah, thank you.
Ask your question. We are wasting more time. No, you're wasting some time because I mean, the beginning of your question was not a question, so so please ask your question. If you want me to do my, my speech, if you want, if you want to do it, you do it. I mean, if you don't want to ask a question, then I will give the floor to other colleagues.
Thank you. Can you allow me to continue? Mr. Navarrette for EPP. Okay, thank you very much. Mr. Navarrette for EPP.
Fernando Navarrete Rojas
Ah, thank, thank, thank you, Chair.
I want to go back to the additionality assessment, and I've heard that technically that is expected to be fully run at 2031, if I heard properly. I'm sorry, I think we need something, I mean, even if it's intermediate, it's not completely final, because now we are designing a new successor. So, sorry, that information is really needed today. The other is just an academic exercise. So please, if you can do something before that, that can help us co-legislators, that would be extremely helpful.
Second, lessons learned, because we need to draw lessons out of the experience from this instrument and EFSI as well. So how are you going to ensure that there is no gap between current instrument and future instrument in terms of time to market? Thank you.
Angéline Furet
Merci beaucoup. Je vais parler en français. Madame la Directrice, je vous souhaite une bonne prise de fonction. Quand l'Union européenne impose ses normes, elle exige une transparence punitive à nos artisans et à nos agriculteurs, mais quand vos méga-projets InvestEU s'effondrent, c'est soudainement l'opacité totale. Vos documents avouent que 196 millions d'euros d'argent public ont déjà été perdus pour éponger des faillites.
Pourtant, la Commission nous interdit l'accès aux dossiers sous couvert de secret des affaires. Assumez-vous de réclamer des milliards tout en refusant de rendre le moindre compte aux élus du peuple ?
Plus grave encore, ce programme garantit 29 milliards d'euros, mais seulement 40 % sont réellement provisionnés pour couvrir les pertes. J'ai donc deux questions simples : ce fonds sert-il à réindustrialiser l'Europe ou à maintenir sous perfusion idéologique des entreprises non viables ? Et le jour où une crise fera exploser ce fragile matelas de 40 %, confirmez-vous que c'est le contribuable français qui paiera l'addition ? Je vous remercie.
Aurore Lalucq
Merci Madame Bergé, je vous rends la parole pour conclure très rapidement parce qu'on a déjà dépassé le temps. Je vous remercie.
Nathalie Berger
Merci beaucoup Madame la Présidente. Sorry, I should move to English. Thank you very much, Madam President. So I will try to cover very quickly the different questions. On the funding that is granted to Member States and the question of potential third countries, as you know, Iceland and Norway are participating.
For the rest, you are asking for a guarantee, but looking at the future, we are still in the middle of the interinstitutional process. So it will be up to the co-legislators to take the final decision on this in the context of the forthcoming trilogues, of course.
I can guarantee what is in the Commission proposal, and then the Commission will try to facilitate the decision-making between the two branches of the legislative power. We had a question on how much money has gone to the SMEs. We have for the SMEs around 25.6 billion euros that have been signed so far and 21.3 billion euros that have been proceeded for SMEs. Then on the question on the final evaluation of the program. So we have proceeded with the mid-term evaluation in 2025.
The impact assessment for the European Competitiveness Fund has been based on this mid-term evaluation, and the full complete final evaluation of the InvestEU program will be proceeded at the latest by 2031, but we will of course do our best to complete it as early as is technically possible. And then last but not least, on the question on the provisioning.
And then, last but not least, on the question on the provisioning, in the context of InvestEU, we have gone for 40% provisioning, which allows us to cover some rather risky investments. In the context of the forthcoming ECF InvestEU program, we will rise, we have risen the proposal for provisioning to 50%. So this will increase our possibility to support what is actually needed, which is to support our SMEs, our startups, our scale-ups, particularly to make sure that we have innovative industry that is being developed, that we support the smallest, but we also support those which are growing, and we make sure that they stay in Europe, because that is our common objective. Thank you very much, Madame la Présidente.
Aurore Lalucq
Thank you, Ms. Bergius, thank you to all of you, and the next meeting will take place on Monday, October 9th in Strasbourg, and thank you to my co-chair, Mr. Van Overtveldt.
Thank you so much. Merci beaucoup.
A lot on SMEs. A lot on SMEs.
Yeah, yeah.
The window is 6.7. Yeah, this is the proof, this is the sign.
Yeah, yeah. But you corrected after, you said... Yeah, yeah, yeah. It's... sorry, it was very quick to... Yeah, yeah, yeah, yeah.
And thanks for having this point because the other questions were too technical. I mean, I... But this is a different composition, it's the budget stories. Yeah, yeah. We do every year this... this report.
This is more the file of our colleagues' file, of course. Yeah, yeah, yeah. No, but it was good that you could... I... I was completely unable to take this.
Speaker 33
No, I noticed. Which we should have had. But okay. Merci. Merci.
Thank you very much, Mr. Chair.
Speaker 30
Yeah, the... our colleagues have put a lot on KPI, but they didn't put this part of the risk, which is also important.
Aurore Lalucq
Yeah, yeah. But you said it at the beginning, it was fine. Yeah, yeah. Yeah, no, it was good.
Okay, so dear colleagues. If you can go back to your seats and welcome to this first ECON committee meeting after the summer recess. I hope you're full of energy.
We will start today's meeting with the adoption of the agenda. If there is no remarks, the agenda is adopted. Interpretation is available today in twelve languages. The final summary of decisions and recommendations taken at the coordinator meeting of July 15th has been made available on e-meeting and there is no objection. They are endorsed.
So, I would like to welcome very warmly to this public hearing in ECON Mr. Carlo Comporti, currently commissioner of CONSOB, the Italian supervisor. Today's hearing is organized in the context of the procedure for the appointment of Mr. Comporti as chairperson of the European Securities and Markets Authority, which is governed by Article 48(2) of the ESMA regulation. By letter of July 22nd, the Council informed the European Parliament of its intention to adopt a decision on the appointment of Mr. Carlo Comporti as chairperson of ESMA, subject to Parliament's confirmation.
This formal hearing in public session serves an important role in the context of the accountability of the ESMA to this Parliament. So, you know the rule. I will give the floor for an opening statement to Mr. Comporti for six minutes, and then there will be a Q&A session: one minute and a half for the questions, three minutes for the answer. So, Mr. Comporti, welcome, and you have the floor for six minutes.
Carlo Comporti
Thank you so much. And Madam Chair, dear members of the ECON Committee, thank you for the opportunity to appear before you today. It is an honor to be considered for the role of Chair of ESMA at this important moment for European financial markets, and also a privilege to seek the leadership of an institution I helped to build. I spent my career at the heart of European financial regulation and supervision, from the ECB and the European Commission to CESR and ESMA, to hands-on supervisory work today as a Consob Commissioner and sitting in the boards of the Financial Stability Board and IOSCO. I know ESMA machinery, its people, its potential, as well as other European and international bodies.
My vision for ESMA is articulated in five priorities. First, in the context of current geopolitical risks, rapidly changing market, technological dynamics, and expected legislative changes, transforming ESMA into a more agile, skilled, trusted, and data-driven supervisor. Second, strengthening supervisory cooperation and convergence. Third, promoting efforts for simplification and burden reduction. Fourth, accompanying and managing financial innovation.
And fifth, managing communications and external relations. This vision rests on three commitments: convergence, credibility, and contribution, and I will elaborate on all of these three. First, convergence. Europe's capital markets remain too fragmented to finance our needs: the green and digital transitions, security and defense, the retirement savings of our citizens. The CMU will not be built by legislation alone.
It requires supervisory convergence as a measurable discipline, not an aspiration.
As chair, I will ensure that all ESMA powers and tools are activated to achieve common outcomes, always respecting proportionality for SMEs. Businesses have a legitimate expectation that the common rulebook is applied consistently across the Union, and investors must be confident they receive the same protection regardless of where their service provider is located. Where the co-legislators entrust ESMA with new direct supervisory mandates, I will guide that transformation and the implementation of the MIS package in strict adherence to cost efficiency, transparency, clarity of roles and responsibilities, good governance, and accountability, fostering new forms of cooperation with national authorities, not competition nor overlap. Second is credibility. Credibility means rigorous evidence-based regulation.
It means a genuine commitment to simplification and burden reduction with the broader objective of fostering competitiveness. I'm convinced that stronger convergence will itself reduce unnecessary costs for authorities, for firms, and for investors, delivering substantive rather than formal protection. It means honesty about resources, requiring sustainable funding, rigorous attention to cost, and full accountability in the use of funds. And I will always be transparent with this Parliament about what ESMA can deliver and at what cost.
And it means also respecting good internal governance. Third, contribution. ESMA must contribute to Europe's strategic agenda. Technology is profoundly transforming our markets, while the geopolitical environment raises the stakes of cyber risk. Having chaired ESMA's Digital Finance Standing Committee, I'm ready from day one to accompany technological changes, making ESMA a center of expertise for technological development, strengthening its data and analytical capabilities to deliver common risk-based supervision.
ESMA must also remain vigilant on non-bank financial intermediation and keep sustainable finance workable. And in this new geopolitical context, ESMA must invest in its external relations within IOSCO and the Financial Stability Board and bilaterally with the key partners that are relevant for global capital markets, so that Europe's voice is influential and coherent as global standards take shape.
Dear members, ESMA is accountable to this Parliament, and I regard that accountability as a source of strength. You will find me a chair who appears before the ECON Committee regularly and candidly, who listens to all, and who never forgets that behind every regulation stand European savers, investors, and pensioners, whose trust we must earn every day. I commit to offer all my experience and energy with cooperative spirit in all relevant matters and fora. It is with excitement that I stand before you, aware of the importance, responsibility, and challenges of serving as chair of ESMA. If appointed, I will devote all my knowledge, experience, and energy to a strong, open, diverse, transparent, and inclusive ESMA and to the growth of financial markets throughout the European Union.
Thank you so much.
Aurore Lalucq
Thank you so much. Q&A session, I will give the floor to Regina Doherty for EPP.
Regina Doherty
Thank you, Chair. Mr. Campa, congratulations first of all on your nomination.
I would like to raise the market integration and supervision package with you, specifically the proposal to transfer direct supervision of significant cross-border infrastructures and crypto-asset service providers from our national competency authorities to ESMA. At a Member State level, current supervisors have spent the last two years building up real supervisory expertise and capacity under MiCA and developing genuine specialisms as a result. And the trade-off with centralizing direct supervision at ESMA is the loss of proximity and accountability for a single layer that's more remote from the firms it's supervising and further from the people whose savings and investments are actually at stake. So do you believe that ESMA has all the tools needed to deliver on its mandate? And how can ESMA make best use of the expertise and experience that currently exists in all of our Member States?
And on a separate note, when we all know the important role that digital assets will play in the future, where do you see the benefits of digital assets for European financial markets and how should ESMA effectively assure that these assets are both available and supervised? Thank you.
Carlo Comporti
Thank you very much, Mrs. Doherty, also for the kind words that you expressed on my recent activity.
I mentioned the, the fact that I've been chairing the Digital Finance Standing Committee as a point of, let's say, to some extent, pride for what I've been doing within ESMA, but also as setting a sort of benchmark on what I see as a potential development of ESMA into supervisory convergence. So let me start by addressing your question with what I consider as an absolute must. Supervisory convergence has been currently lagging behind and, let's say, the, the objective of the single market by single, let's say, the single rulebook proved not to be sufficient. So we need to address the fact that supervisory, let's say, convergence has not been achieved until now, and there are different ways. You can, let's say, reinforce the way in which NCAs cooperate and achieve common understanding on how to implement rules, and that is what we have been doing.
Or you can attribute to ESMA, let's say, direct supervisory responsibility. These two go, I would say, hand in hand. They are not necessarily mutually exclusive, because even when ESMA will be entrusted with direct supervisory responsibility, if this remains within the significant ones, there are the non-significant that will still remain under the responsibility of national authorities that still need to be, let's say, convergent in their national approaches.
So that is a fundamental point. Regarding where to put the bar, I would always take the principle of subsidiarity, that is a common principle of the functioning of the European Union, as an inspiring guidance or criteria, let's say, to make the allocation. But honestly, this is the role of co-legislators, and I will fully respect whatever co-legislators will end up in deciding on how to, let's say, transfer responsibility to ESMA or not. If this is the case and where certain, let's say, activities, you mentioned trading venues, CASP, would be transferred, I will ensure that ESMA would be fit for the purpose, of course, with some sort of time, and I will be able to elaborate on what the plans are.
But clearly we need the leadership, we need transformation, we need a clear roadmap with prioritization. And we need also skill set assessment because the current skills within ESMA are not necessarily the ones that would be needed. And here the point of transferring knowledge from NCAs, because NCAs are currently the ones that are in charge, and we should not duplicate, we should rather see these complementing each other. On digital assets, that is much broader topic. I see this as a clearly transformation, profound transformation of how financial markets function, and I will devote...
Now I have to stop, I know. I hope there will be other, let's say, questions on this because I have a clear vision on how this should be designed and accompanied, designed and accompanied. Sorry, thanks.
Irene Tinagli
No, it's okay. Thank you so much, Irene Tinagli for this and the... Okay, I take up your call on more questions on digitalization. Okay. So, my question is on tokenization because it's increasingly seen by international institutions and financial market participants as potentially transformative for the financial system.
The ECB itself has presented it as an opportunity to overcome fragmentation in the European capital markets, build a more integrated financial ecosystem, but these benefits are not automatic.
So even the ECB itself has warned that without interoperability, tokenization could actually have negative effects on, you know, creating new technological gatekeepers, fragment liquidity. So I would like to hear your view on this, if you think it's just a technical issue, if it involves also, you know, competition, market structure issues, and does the existing framework of ESMA, you know, give ESMA the powers to manage and accompany this process and to prevent closed ecosystems and ensure effective cross-border access to tokenized trading and settlement infrastructures? Thanks.
Carlo Comporti
Thank you, Mrs. Tinagli. I'm happy because it's exactly the kind of opportunity I was seeking to further elaborate on this. Let me start from what I consider to be, let's say, a firm belief. The transformation of tokenization is something that has the potential to change the functioning of financial markets, at least the current mechanism of functioning of financial markets. And I think it should be coupled also with the strategic objective of achieving the savings and investment union.
This is creating a new digital finance ecosystem. There are tangible benefits that have been demonstrated, also to your question, what are the benefits? There are tangible benefits that have been demonstrated through experimentation. And there are countries that are more advanced than Europe all together. There is an atomic settlement, there is a potential reduction of risk, there is the programmability of smart contracts that help in itself by design, let's say, alleviating some of the pains of the current operations.
I will tell you in a minute why.
But we need to, if we want to exploit these, let's say, potentials, we need to move fast. Because Europe has been lagging behind compared to Asia and compared to the latest developments across the Americas and particularly the US, given the recent, let's say, administration policy. Now, what are the axes in order to address and potentially exploit the benefits? The first you mentioned is the regulatory. Currently, we started globally with a very clear framework, the DLT pilot regime.
It proved probably to be too tight, too constraining and it did not allow the market to scale. So I think the proposals coming to get better let's say flexibility in size, in terms of scope of assets, in terms of timing would clearly give the possibility for the market to invest and have a sort of long-term vision. Second is the payments. The payment leg so far have been missing let's say in terms of availability. Some that are more private nature are coming available because of MiCA, but the ECB is projecting let's say a clear let's say strategy with the two projects Pontos and Appia with the target operating model.
And the fact that they started already receiving as collateral digital assets means something in terms of market operations. But I would add another one that is not yet on the table, that is the legal clarity across Europe. In order to exploit the full market we need probably a 28 regime, we need to study a 28 regime for the having a sort of European-wide system of legal system of transfer of entitlements. And last point, but of course there are more, the vision about the infrastructures.
The market ecosystem will work on ledgers. These ledgers, in the recent even speeches by key ECB representatives, could be presented as one single ledger, but with pros and cons also in terms of innovation and competition. But on the other side, more ledgers and then the question of the interoperability runs also in terms of what are the, let's say, standards for safety and establishing the bridges. I have to stop here, but I think that the ecosystem need to be addressed by public and private initiatives.
Enikő Győri
Benvenuto, signor Comporti, piacere di salutarla qua. I have two questions. The first one, and I will take you back to where we started from with my Irish colleague's question concerning centralization versus subsidiarity, because my group is especially worried about over-centralization of financial market supervision, but I will not repeat what has already been said. And let me be a bit more specific on this question.
Having a more centralized approach, how do you think it could be taken into account the interest and specific needs of all Member States, including those with smaller and less developed capital markets? Because my fear is that having more centralization, specific interest, specificities of these countries can be easily ignored. So what you can do as Chair of ESMA to go against that? And my second question would be more on simplification. Despite years of policy initiatives under the CMU, European SMEs and startups remain heavily dependent on bank financing and public markets continue to attract relatively few growth companies.
If appointed as a Chair of ESMA, which existing regulatory requirements you would be prepared to simplify or reconsider to improve market access for SMEs and startups, and would you be willing to accept even a higher level of risk for investors? Thank you so much.
Carlo Comporti
Thank you so much, Mr. Győri. I think that these two questions are very relevant in the understanding of the future interactions between, let's say, the European-wide and the national.
Let me start from your this very much important point. I truly believe that across Europe we should not forget that a local ecosystem should remain the entry point, should represent the, let's say, the first layer of proximity with, particularly with SMEs. You mentioned the SMEs in the second question. Our financial economic structure is largely based on SMEs and I think that proximity matters with them. I will come back to the point on proportionality and how to assist their funding needs.
But vibrant local ecosystem in my view is an important asset across Europe. That doesn't mean that these local ecosystem should remain constrained within the national barriers. That is the problem and we need to address their capacity to link up, to connect, to be interoperable, to, let's say, to create larger liquidity pools because that is the problem and the connection may create the conditions for growth, may create the all what MISP in the end is trying to address.
So I will not repeat what I mentioned in terms of where to put the bar between local and, let's say, but the two are completely coexisting and should continue to coexist. That doesn't mean that there should be a massive transfer of competence from local authorities into the central level. I think that that is a matter of organizing a cost-efficient mechanism of cooperation that would need to be based on clear principles. And here I would really advocate for co-legislators to put in level one clear principles of roles, responsibility, legal grounds on which these cooperation arrangements will be, will need to be built. But these cooperation arrangements will then need to be built on the base of flexibility, because not every single sector, let's say, caters the same mechanism of cooperation.
Not every single sector, let's say, is exactly the same as a point of time. So over time the flexibility should be adjusted. To your point on SMEs, I mentioned already how important they are. And I also, by the way, I come from a country where, let's say, the sector, the economic sector is largely, let's say, based on SMEs.
And at national level, we have been doing all what even recently with legislative changes what is needed to strengthen the alternative means of access to funding. They need to fund for their growth and scale is what we need across the single market. The Listing Act is a good example. We need more. So simplification and burden reduction that I put in one of my key priorities is something that would definitely help from that perspective, but with concrete measures.
So I think that we need to look at the way in which IPOs are, let's say, favored, the way in which conditions for maintaining the admission to trading and the way in which we can favor the trans-listing, because sometimes SMEs start with market growths and then they trans-list to the higher level. That is what we need to look. And last point, I would just echo the fact that venture capital is an additional extra source that I hope that proposal from the Commission will come soon to review the current framework.
Giovanni Crosetto
Thank you, Chair, and thank you very much, Mr. Comporti, for your contribution.
I will go on in Italian. Come lei sa molto bene, è in corso una profonda fase di revisione delle infrastrutture e dei meccanismi di supervisione di mercato e uno dei protagonisti sarà proprio ESMA. Come spesso vediamo accadere in questa commissione, ma non solo in questa, stanno emergendo due chiare visioni di come interpretare questa transizione. Da una parte c'è chi vorrebbe una rapida e sostanziale centralizzazione delle funzioni di vigilanza in capo ad ESMA, penso ad esempio alla governance ed al perimetro di competenza dell'autorità. E dall'altra c'è chi invece ritiene, come ad esempio il gruppo che io qui rappresento, che non basti una revisione legislativa per poter trasferire competenze, cultura e operatività dalle autorità nazionali competenti a quella europea, ma serva un approccio più graduale.
Volevo chiederle, sulla base della sua esperienza maturata in una delle più importanti autorità nazionali competenti, ma anche della sua importante partecipazione a quella che è stata la precedente fase di transizione che ha visto il passaggio da comitato, il CESR, ad autorità, l'ESMA che tutti oggi noi conosciamo, come si può oggi interpretare questa importante revisione legislativa trovando il giusto equilibrio tra opportunità e potenziali rischi? Grazie ancora.
Carlo Comporti
Thank you so much, Mr. Crosetto. That helped me probably to complete a little bit the vision that I started addressing with other questions and I will not repeat what I've been mentioning in terms of exactly the line to be drawn between national and European responsibilities, at least in terms of supervision or direct supervision. And I will not repeat what I already mentioned in terms of supervisory convergence that in my view remains paramount in the new context.
But probably I take your question as an opportunity to elaborate on how I see the next steps, okay? Because I give it for granted that of course it's in your hands, but that some activities then is reduced in or large in the scope and in terms of significance, in terms of let's say areas of business will be transferred as direct supervision. It's not the first time that it happens, but it is true that for the previous let's say activities to be supervised directly by ESMA, these were newly direct supervised entities. So so far there's not been a transfer of competencies from NCAs and national authorities into ESMA. So some very concrete and practical let's say arrangements in order to respond to your questions also based on my experience.
I already mentioned that the current the current competence and knowledge should not be dispersed, okay? So in a way there should be way gradually, I don't think that that is something that happens overnight and I mentioned already the need to have a sort of roadmap. We cannot even from the ESMA side onboard all these new activities in just one go. Probably we need to prioritize a roadmap. I mentioned we need to run assessment about how many new let's say staff, what kind of new staff, how to fund it.
So we need to prepare for it. But probably I see this gradually to transfer, let's say, areas by areas. And probably I give it what it could happen that, for instance, CCPs, if transferred, would be the ones where, let's say, ESMA has already sufficient knowledge. Then you may target CASP where, for the reasons that I mentioned previously, there is already other knowledge. And then you may transfer, let's say, trading venues.
But I'm not advocating now, not committing, but just to give you a sense of what I aim at doing in terms of transition. But preparing, establishing a roadmap, clear communication between all stakeholders, including of course I would say here with this committee in terms of preparation what can be delivered or not. That is, in my view, paramount. I mentioned funding because without resources it is, I would say, unwise to take additional responsibility. And the funding mechanism should be, let's say, corresponding to the new responsibility.
And I mentioned arrangements for transferring knowledge.
These, there are already mechanisms in place, particularly at the SSM. We can look at what has been working well at the SSM and take inspiration. But I keep it for granted that the cooperation between ESMA and NCAs would remain paramount also for the future.
Gilles Boyer
Merci Madame la Présidente et merci Monsieur Comporti pour votre présence ici et pour vos réponses. Évidemment vous êtes candidat à la tête de l'ESMA dans un moment tout à fait crucial de son histoire pour accompagner la mise en place de l'Union de l'épargne et de l'investissement que nous souhaitons sinon tous, du moins dans notre grande majorité. J'aurais une question sur un point peut-être un peu plus général. Nous sommes tous ici à la recherche du, je crois, du bon équilibre entre d'une part la protection des investisseurs, la stabilité de nos marchés financiers et d'autre part la nécessité de renforcer l'attractivité des marchés européens, en particulier vis-à-vis des États-Unis et de l'Asie.
Aujourd'hui une partie trop importante de l'épargne des Européens quitte l'Europe pour aller s'investir sur des marchés qui sont aujourd'hui considérés comme plus attractifs. Et je voulais savoir quelle était votre vision de cet équilibre pour préserver évidemment ce qui doit l'être, la protection des investisseurs, la stabilité des marchés, mais aussi la nécessité de lutter à armes égales contre des compétiteurs qui n'ont peut-être pas exactement les mêmes préoccupations. Et je voulais avoir votre regard sur cet équilibre. Merci.
Carlo Comporti
Thank you so much, Monsieur Boyer. You go back to the fundamentals of what we are what we have been discussing and what is let's say I would say in the broader CMU agenda, the strategy and the individual let's say legislative proposals that you are currently discussing. This equilibrium clearly I would say the current mechanism, the current situation is unsatisfactory. So I don't have to elaborate. There are excellent reports that have been prepared that have been convincing I would say all institutions and stakeholders.
There is a strong commitment to ensure that the objectives that have been identified will be implemented also in the short time. I think that the fact that you combine the three elements, investor protection, stability and attractiveness, that is also a matter of competitiveness to add another keywords in this triangle, I would say that is most important is to ensure a coherence. What is different from my understanding compared to the past is that we have been working under action plans with isolated, let's say, actions that comprehensively did not give necessarily a coherent picture. I would say that the coherence of these three elements would be paramount in order to achieve the objectives. Clearly, do I have to compromise investor protection if I strengthen the investment of, let's say, retail investors in the equity market?
If I create a good conditions and a market, better market integration, better market deepening with better liquidity, with more participation from retail but also from institutional investors, by definition, I think that these markets will be more protecting investors but will be also more competitive and attractive by definition. So I think that there are elements that are reinforcing themselves, but we need to take all together. The fact that most of our savings, let's say, are directed, some of them, of course, either because of direct choice or because of mandates by portfolio managers that are seeking yield, they are channeled through the US. I think that in the near future, the new market conditions will repatriate these savings and will be important for the growth of our economy, for the success overall of the single market and ultimately the investor protection. So I think the key message I wanted to give is that in isolation you can challenge or you can discuss, all together they are reinforcing themselves to achieve the strategy.
Pasquale Tridico
Thank you, Madam Chair. First of all, congratulation to Mr. Comporti for the nomination.
I would like to insist on digitalization because I think this is the real challenge for the future supervision of the authority. Because actually this is increasingly transforming the European financial system so far, creating new opportunity, but also new challenge for regulators. From artificial intelligence and digital assets to new forms of financial services. These developments can raise significant risk for investor, market integrity and financial stability as well. As incoming chair of ESMA, what would you see as the main risk and opportunity arising from digital finance and what would be your priority to ensure that innovation does not come at the expense of investor protection and resilient financial market?
Thank you very much.
Carlo Comporti
Thanks to you, Mr. Tridico, because you allow me to elaborate also. We have been discussing about the current implementation of certain, let's say, pieces of legislation on the digital finance, the opportunities and some sort of risk, but how to accompany the financial innovation.
You go back to the same question but with another perspective, that is the risk, broadly speaking, that these innovations bring in order in our mandate as supervisor, but also to the broader community of users and particularly the investors, as you mentioned. So I, I start with one clear assessment, that is the speed and the uncertainty of the technological developments make us necessarily not fully aware of the, the developments themselves and the combined impacts. So the first point I want to retain is clearly to be always up to the standards, up to the most important developments to understand their risk. And that's why I've been in my introductory remarks, if Europe wants to take leadership, and we know that we have been lagging behind on some technological developments and we had dependence from other non-European, let's say, jurisdictions, we need to regain competence, we need to regain capacity to master the developments and related risk.
I just mention one that is very clear: cyber risk. In this new geopolitical context, cyber risk is evident, but I would echo the words that Andrew Bailey, the chair of the Financial Stability Board, just released few days ago with a letter to the G20, raising the risk of the frontier models for AI, for which there is a risk, exacerbated risk for cyber, but also the opportunity to use the same models in order to defend. So the consequence of all of this is to master the developments and to master also how the supervisory efforts should be done vis-à-vis supervised entities with preparedness, capacity to patch, and capacity to restore operational conditions shortly. From that perspective, we are good that we have the DORA framework that is currently being implemented.
ESMA is one of the key supervisors together with the others. There is a joint committee effect on ESMA because it's by definition horizontal. And from that perspective, ESMA would need to ensure that the market infrastructures, let's say, comply with the DORA framework. Just last point is you just to add additional risk. Of course, the concentration and dependence are important ones.
The dependence, I think that we go back to the VSIU conditions. If we create capacity to fund our technological industry, we'll probably in future reduce the dependence from non-EU providers and these concentration effects. Thanks.
Siegbert Frank Droese
Yeah, thank you, Chair. I will be speaking German. Mr. Gambotti, vielen Dank für Ihre Vorstellung und interessant, das teilt ja hier meine Meinung, was Sie zur Subsidiarität gesagt haben und die Frage zum Binnenmarkt, die ich habe. Also ein Binnenmarkt kann ja logischerweise nur ordnungsgemäß funktionieren, wenn dieselben europäischen Vorschriften von den nationalen Aufsichtsbehörden alle gleich ausgelegt und durchgesetzt werden.
Eine weitere Zentralisierung auf europäischer Ebene ist jedoch nicht automatisch ein Ersatz für eine wirksame nationale Verantwortlichkeit. Ab welchen objektiv feststellbaren Punkt sollte eine anhaltend unterschiedliche Anwendung des europäischen Kapitalmarktrechts bei ein Eingreifen der ESMA auslösen und welche der bestehenden Konvergenz- und Durchsetzungsbefugnisse der ESMA wären Sie tatsächlich bereit, in so einem Fall einzusetzen? Vielen Dank.
Carlo Comporti
Thank you so much, Mr. Druse. We go back to the issue of supervisory convergence to some extent and let's say the fact that the attempt to achieve the single market in itself by virtue of having a single rulebook proved to be, let's say, unrealistic. I mentioned already and I repeat that my vision is to properly reduce the burden but not the effectiveness of the of the regulatory framework with the simplification and burden reduction agenda and to complement this with an increased attention on how supervisors implement the different the different the rules in a coherent manner. I think that by readjusting...
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