EU weighs up benefits of capital markets union


Consultations are currently underway in the EU to determine whether a single market for capital could be rolled out across all 28 member states.

Called a “Green Paper” the consultation round aims to spark debate on how such a market could be created. It will then use the insights harvested from the round to develop an action plan that, it says, would help to open up non-bank funding sources.

In addition, the key aims of the capital union market would be to improve access to finance for business and infrastructure projects across Europe and remove barriers to cross-border investments. In turn, it says, this would diversify the ways in which the economy is funded while reducing the cost of raising capital

As groups such as Business for New Europe have suggested, the move could have benefits for start-ups and SMEs as well as larger corporations. The Commission says that it wants smaller firms to be able to raise capital as easily as large ones.

“Capital markets union is about unlocking liquidity that is abundant, but currently frozen, and putting it to work in support of Europe’s businesses, and particularly SMEs,” said EU Commissioner Jonathan Hill.

“The free flow of capital was one of the fundamental principles on which the EU was built. More than 50 years on from the Treaty of Rome, let us seize that opportunity to turn that vision into reality.”

Those wishing to contribute to the Green Paper should do so by the 13th May.