MISP (Market Integration and Supervision Package)

Overview

The European Commission’s Market Integration and Supervision Package (MISP) is viewed as a core element of its Savings and Investments Union strategy. It aims to deepen capital market integration in the EU by strengthening ESMA’s role, harmonising rules, promoting innovation (DLT, tokenisation) and simplifying the EU regulatory framework.

Formally, this initiative is divided into three legislative pillars: A number of amendments to UCITS, AIFMD and MiFID, an “Omnibus” simplification package (including changes to CSDR, MiCAR and ESMA’s founding regulation) and a new regulation replacing the Settlement Finality Directive.

Main provisions

As regards the Financial Market infrastructures European ecosystem :

• A stronger, more centralised ESMA supervision for the largest players (trading venues, CCPs, CSDs); and changes to rules on interoperability and cross‑border functioning

 

As regards asset management:

• More harmonised European “cross‑border” fund distribution rules (communications, regulatory fees and charges), together with a new “EU Group” concept for large Asset Managers, with specific provisions for intra‑group resource allocation and supervisory obligations.

• The initiative  proposes to introduce a European depositary passport in AIFMD/UCITS. Yet, this unexpected proposal is widely viewed by the industry as premature and potentially confusing for investors.

 

As regards DLT, tokenisation and crypto:

• Easing of limitations in the current DLT Pilot Regime (e;g; higher value threshold; duration of existence) and ESMA would directly supervise crypto‑asset service providers (CASPs) when these services are their main activity.

• Regulatory simplification and revised ESMA powers account for a large part of the initiative: they include the conversion of some directives into directly applicable regulations; a tighter framing of Level 2 empowerments, and an stronger ESMA role through convergence tools, mandatory cooperation with national supervisors, enhanced conflict‑resolution powers and a wider use of “no‑action letters”

CACEIS opinion

CACEIS supports the overall objective of a more integrated, efficient and innovative European financial market. However, feedback from CACEIS and other stakeholders highlight several concerns and open points that require clarification to avoid unintended consequences:

• A need for clearer allocation of responsibilities between ESMA and national regulators

• The risk that mandatory interoperability and revised supervision schemes could generate additional costs ultimately borne by the users and investors.

• Significant reservations in the industry about the timing and design of a European depositary passport, seen as a potential source of operational complexity and investor confusion