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Events

2014/07/22
   EC - Commission response to text adopted in plenary
Documents
2014/02/26
   EP - Results of vote in Parliament
2014/02/26
   EP - Decision by Parliament, 1st reading/single reading
Details

The European Parliament adopted by 560 votes to 55 with 19 abstentions a resolution on long-term financing of the European economy in response to the Commission Green Paper on the subject. Members stressed that there was a persistent lack of confidence and a high level of risk aversion on the part of both private and institutional investors, and the low-interest environment, low growth projections, and economic uncertainty had significantly decreased the supply of long-term financing and the risk appetite for long-term projects.

Reasoning: Parliament stated that concrete advances needed to be made as a matter of urgency in order to relaunch long-term investment and job creation in the EU. Training and education costs should be treated as long-term investments in this respect. It noted that banks in the EU provided over 75 % of long-term financing, which created significant dependence on this funding source, while in the US less than 20 % of all long-term financing is provided by banks, and a large majority through well-developed capital markets.

Emphasising that fiscal consolidation was the priority for public budgets with a view to restoring compliance with the Stability and Growth Pact and the ‘two-pack’, Parliament supported the initiative aimed at enhancing private investment in long-term financing.

Barriers to growth : the resolution noted that some countries we re facing serious obstacles to, or even being denied, access to capital markets because they have contracted excessive levels of debt in recent years, while capital markets were the main cause of the recent crisis . F urther more , SMEs in many Member States we re having great difficulty accessing ca pital because commercial banks we re only prepared to grant loans subject to unduly tough conditions . Parliament pointed to limited public financing and the need for investors in the banking and insurance sectors to adapt their business models to evolving and tightened regulatory requirements. It called on the Commission to assess systemic risks to capital markets and society at large owing to the overhang of unburnable carbon assets.

Alternative funding mechanisms: Parliament stressed the need for Member States to establish new sources to complement established mechanisms and fill the funding gap, and proposed that consideration be given to the creation of an investment section in the EU budget . It emphasised the strengthened role of new, innovative financial instruments in all the funding covered by the European Structural and Investment Funds, and the need for legal clarity and transparency of the new off-the-shelf financial instruments.

Parliament also called for:

· an enhanced European framework for less liquid investment funds in order to channel private households’ short-term liquidity into long-term investments and provide an additional retirement solution;

· a harmonised approach to the long-term valuation of projects of general interest supported with public resources at the EU and national levels;

· appropriate networks for cooperation and the exchange of information, and national or regional long-term public investors which can learn from the best practice of already established institutions;

· ways to support Member States requiring financial and technical assistance to set up their long-term national and regional public investors, and to study the possibility of an EU guarantee mechanism for long-term national public investors ;

· improved access to capital markets through new sources of funding such as initial public offerings, crowd funding, peer-to-peer lending and (covered) bonds or through new market segments;

· strengthening both the banking system, including cooperative and public savings banks, and banks’ ability to access long-term refinancing to cover their long-term investments;

· further assessment of the role of venture capital and private equity firms in financing the EU economy.

Regulatory environment : Parliament emphasised that an investor-friendly business climate with a strong drive for technological progress is a prerequisite for making the EU an attractive destination for foreign direct investment. Such an environment would feature initiatives aimed at pooling financial resources, a sound taxation system, appropriate accounting principles, effective corporate governance and efficient prudential regulation - all embedded in a functioning single market. Parliament believed that a specific impact assessment of long-term financing should be included in any legislative proposals for relevant financial services regulation. It encouraged the Commission to follow closely the G20's work on proposals to create a multilateral investment framework that set minimum standards and modified certain long-term investment regulations and fair value accounting rules. The Commission was also asked to assess the impact of Member States’ tax incentives on long-term finance and the energy transition.

Parliament asked for SMEs to be given priority access to European long-term investment funds (ELTIFs), since they constituted the backbone of growth and job creation in the EU.

Lastly, Parliament stressed the need for a reliabl e tax environment that prevented impe diments to long-term investment, and encouraged Member States and the Commission to assess the possibility of granting tax-advantageous yields on sustainable infrastructure projects or other tax incentives and concessions to promote long-term investment .

Documents
2014/02/26
   EP - End of procedure in Parliament
2014/01/29
   EP - Committee report tabled for plenary, single reading
Details

The Committee on Economic and Monetary Affairs adopted the own-initiative report by Wolf Klinz (ALDE, DE) on long-term financing of the European economy in response to the Commission Green Paper on the subject. It noted that banks in the EU provided over 75 % of long-term financing, which created significant dependence on this funding source, while in the US less than 20 % of all long-term financing is provided by banks, and a large majority through well-developed capital markets. Members stressed that there was a persistent lack of confidence and a high level of risk aversion on the part of both private and institutional investors, and the low-interest environment, low growth projections, and economic uncertainty had significantly decreased the supply of long-term financing and the risk appetite for long-term projects.

Barriers to growth : the report points to limited public financing and the need for investors in the banking and insurance sectors to adapt their business models to evolving and tightened regulatory requirements. It called on the Commission, in cooperation with the European Systemic Risk Board, to assess systemic risks to capital markets and society at large owing to the overhang of unburnable carbon assets.

Alternative funding mechanisms: Members stressed the need for Member States to establish new sources to complement established mechanisms and fill the funding gap, and proposed that consideration be given to the creation of an investment section in the EU budget . They emphasised the strengthened role of new, innovative financial instruments in all the funding covered by the European Structural and Investment Funds, and the need for legal clarity and transparency of the new off-the-shelf financial instruments.

The report also called for:

· an enhanced European framework for less liquid investment funds in order to channel private households’ short-term liquidity into long-term investments and provide an additional retirement solution;

· a harmonised approach to the long-term valuation of projects of general interest supported with public resources at the EU and national levels;

· appropriate networks for cooperation and the exchange of information, and national or regional long-term public investors which can learn from the best practice of already established institutions;

· ways to support Member States requiring financial and technical assistance to set up their long-term national and regional public investors, and to study the possibility of an EU guarantee mechanism for long-term national public investors ;

· improved access to capital markets through new sources of funding such as initial public offerings, crowd funding, peer-to-peer lending and (covered) bonds or through new market segments;

· strengthening both the banking system, including cooperative and public savings banks, and banks’ ability to access long-term refinancing to cover their long-term investments;

· further assessment of the role of venture capital and private equity firms in financing the EU economy.

Regulatory environment : Members emphasised that an investor-friendly business climate with a strong drive for technological progress is a prerequisite for making the EU an attractive destination for foreign direct investment. Such an environment would feature initiatives aimed at pooling financial resources, a sound taxation system, appropriate accounting principles, effective corporate governance and efficient prudential regulation - all embedded in a functioning single market. Members believed that a specific impact assessment of long-term financing should be included in any legislative proposals for relevant financial services regulation.

They encouraged the Commission to follow closely the G20's work on proposals to create a multilateral investment framework that set minimum standards and modified certain long-term investment regulations and fair value accounting rules. The Commission was also asked to assess the impact of Member States’ tax incentives on long-term finance and the energy transition.

Lastly, the committee asked for SMEs to be given priority access to European long-term investment funds (ELTIFs), since they constituted the backbone of growth and job creation in the EU.

Documents
2014/01/22
   EP - Vote in committee, 1st reading/single reading
2013/12/20
   EP - Committee opinion
Documents
2013/12/11
   EP - Committee opinion
Documents
2013/12/05
   EP - Amendments tabled in committee
Documents
2013/11/05
   EP - Committee draft report
Documents
2013/09/12
   EP - Committee referral announced in Parliament, 1st reading/single reading
2013/09/11
   EP - GUTIÉRREZ PRIETO Sergio (S&D) appointed as rapporteur in EMPL
2013/07/11
   EP - ZELLER Joachim (PPE) appointed as rapporteur in REGI
2013/06/18
   EP - KLINZ Wolf (ALDE) appointed as rapporteur in ECON
2013/03/25
   EC - Non-legislative basic document published
Details

PURPOSE: to launch a debate on how to improve the possibilities of long-term financing of the European Union (Commission Green Paper).

BACKGROUND: to return to a path of growth and crating jobs building on its areas of competitive advantage, Europe faces large-scale, long-term investment needs. This relates to investment in energy, transport and communication or housing infrastructure, in industrial and service facilities, climate change-related and eco-innovation technologies or in assets, such as education and research and development.

Trends in climate change and the depletion of natural resources further underline the sustainable growth challenge, as they call for more long-term investment in low-carbon energy, energy and resource efficiency and infrastructure.

To fund these long-term investments, governments and businesses need access to predictable, long-term financing . The capacity of the economy to make such long-term financing available depends on the ability of the financial system to channel the savings of governments, companies and households effectively and efficiently to the right users and uses. This can be carried out indirectly by various intermediaries (e.g. banks, insurers and pension funds) and directly by access to capital markets.

The financial crisis has affected the ability of the financial sector in Europe to channel savings to long-term investment needs. Above all, it has created a climate of uncertainty and risk aversion, particularly in those Member States under financial pressure and for SMEs.

In this context, the Commission considers that it is urgent to give consideration as to how the availability of long-term financing might be improved. That is the purpose of this Green Paper.

CONTENT: by means of this Green Paper, the Commission is seeking to initiate a broad debate about how to foster the supply of long-term financing and how to improve and diversify the system of financial intermediation for long-term investment in Europe by allowing significantly higher shares of direct capital market financing and greater involvement of institutional investors and alternative financial markets.

The focus is on long-lived capital goods (such as economic and social infrastructure, buildings and R&D, education and innovation), not because they are more important for growth than shorter-lived capital goods (such as computers, mobile phones and vehicles). Rather, investment volumes for short-lived capital goods are strongly pro-cyclical. These volumes are currently down because of the weak macroeconomic outlook in Europe.

As part of the measures taken in response to the crisis, the Commission considers that the new regulatory and prudential framework must be calibrated, including in the area of taxation, in such a way as to enable and provide an incentive to the financial sector to support the real economy without jeopardising financial stability .

On this basis, action to enhance the long-term financing of the European economy should address a broad range of interconnected factors :

the capacity of financial institutions to channel long-term finance: given the evolving nature of the banking sector, the Green Paper asks the question as to what is the role of the banks, national and multilateral development banks and institutional investors (insurance companies, life assurance, pension funds, mutual funds and endowments) going forward in the financing of long-term investments; the efficiency and effectiveness of financial markets to offer long-term financing instruments: the questions relate to: (i) the improvement of capital market financing of long-term investment; (ii) the contribution of capital markets to filling the equity gap in Europe; (iii) the pros and cons of developing a more harmonised framework for covered bonds; (iv) ways to revive the securitisation market in the EU; cross-cutting factors enabling long-term saving and financing: (i) the setting in place of specific vehicles at EU level, more directly linked to general social objectives with a view to mobilising long-term savings; (ii) identification of the types of corporate tax incentives that are beneficial; (iii) deepening tax coordination in the EU; (iv) what kinds of tax incentives could help to promote better long-term shareholder engagement; the ease of SMEs to access bank and non-bank financing: the Commission considers that additional measures could be envisaged, such as: (i) the development of venture capital; (ii) the development of dedicated markets and networks for SMEs; (iii) the development of standards for credit scoring assessments of SMEs; (iv) the development of “non-traditional” sources of finance, such as leasing, supply-chain finance or funding via the internet (e.g. crowdfunding).

On the basis of the outcome of this consultation, the Commission will consider the appropriate actions to pursue further. Stakeholders are invited to send their comments by 25 June 2013.

Documents

Votes

A7-0065/2014 - Wolf Klinz - § 26

2014/02/26 Outcome: +: 524, -: 82, 0: 21
DE ES FR IT RO PL HU BG PT BE EL SK AT IE FI LT SE NL SI HR LU MT LV EE DK CY GB CZ
Total
89
50
58
52
26
42
19
16
16
18
17
12
16
12
12
9
19
23
7
11
6
6
7
5
9
5
53
11
icon: PPE PPE
231

Luxembourg PPE

3

Malta PPE

2

Estonia PPE

For (1)

1

Cyprus PPE

1

Czechia PPE

1
icon: S&D S&D
160

Ireland S&D

2

Finland S&D

2

Netherlands S&D

3

Slovenia S&D

For (1)

1

Luxembourg S&D

For (1)

1

Estonia S&D

For (1)

1

Czechia S&D

2
icon: ALDE ALDE
74
4

Greece ALDE

1

Slovakia ALDE

For (1)

1

Austria ALDE

1

Lithuania ALDE

1

Slovenia ALDE

2

Luxembourg ALDE

For (1)

1

Latvia ALDE

For (1)

1
2

Denmark ALDE

2
icon: Verts/ALE Verts/ALE
49

Portugal Verts/ALE

For (1)

1

Belgium Verts/ALE

Abstain (1)

3

Greece Verts/ALE

1

Austria Verts/ALE

1

Finland Verts/ALE

2
3

Netherlands Verts/ALE

2

Luxembourg Verts/ALE

For (1)

1

Latvia Verts/ALE

1

Estonia Verts/ALE

For (1)

1

Denmark Verts/ALE

For (1)

1

United Kingdom Verts/ALE

5
icon: NI NI
24

Spain NI

1

France NI

2

Italy NI

For (1)

1
2

Hungary NI

For (1)

Against (1)

2

Bulgaria NI

Against (1)

1

Belgium NI

Against (1)

1

Ireland NI

For (1)

1

United Kingdom NI

3
icon: EFD EFD
25

France EFD

Against (1)

1

Poland EFD

3

Bulgaria EFD

For (1)

1

Belgium EFD

Against (1)

1

Greece EFD

2

Finland EFD

Against (1)

1

Lithuania EFD

For (1)

1

Netherlands EFD

Against (1)

1

Denmark EFD

Abstain (1)

1
icon: GUE/NGL GUE/NGL
24
3

Portugal GUE/NGL

Against (1)

1

Greece GUE/NGL

2

Ireland GUE/NGL

Abstain (1)

1

Sweden GUE/NGL

Against (1)

1

Netherlands GUE/NGL

Against (1)

1

Croatia GUE/NGL

Against (1)

1

Latvia GUE/NGL

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1

Denmark GUE/NGL

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1

Cyprus GUE/NGL

2

United Kingdom GUE/NGL

Against (1)

1

Czechia GUE/NGL

Abstain (1)

1
icon: ECR ECR
39

Italy ECR

2

Hungary ECR

Against (1)

1

Lithuania ECR

1

Netherlands ECR

Against (1)

1

Croatia ECR

Against (1)

1

Denmark ECR

Against (1)

1

A7-0065/2014 - Wolf Klinz - § 28

2014/02/26 Outcome: +: 521, -: 74, 0: 32
DE ES IT FR RO PL HU BG PT BE EL SK IE LT SE AT HR NL SI LU FI MT DK EE LV CY GB CZ
Total
88
51
50
60
26
43
19
16
17
18
16
12
12
9
18
16
11
23
7
6
12
6
9
5
6
5
55
10
icon: PPE PPE
230

Luxembourg PPE

3

Malta PPE

2

Estonia PPE

For (1)

1

Cyprus PPE

1

Czechia PPE

1
icon: S&D S&D
155

Ireland S&D

2

Netherlands S&D

2

Slovenia S&D

For (1)

1

Luxembourg S&D

For (1)

1

Finland S&D

2

Estonia S&D

For (1)

1

Czechia S&D

2
icon: ALDE ALDE
72
4

Greece ALDE

1

Slovakia ALDE

For (1)

1

Lithuania ALDE

1

Austria ALDE

1

Slovenia ALDE

2

Luxembourg ALDE

For (1)

1

Denmark ALDE

2
2
icon: Verts/ALE Verts/ALE
51

Portugal Verts/ALE

For (1)

1

Belgium Verts/ALE

Abstain (1)

4

Greece Verts/ALE

1
3

Austria Verts/ALE

1

Netherlands Verts/ALE

3

Luxembourg Verts/ALE

For (1)

1

Finland Verts/ALE

2

Denmark Verts/ALE

For (1)

1

Estonia Verts/ALE

For (1)

1

Latvia Verts/ALE

1

United Kingdom Verts/ALE

5
icon: EFD EFD
25

France EFD

Against (1)

1

Bulgaria EFD

For (1)

1

Belgium EFD

Against (1)

1

Greece EFD

2

Lithuania EFD

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1

Netherlands EFD

Against (1)

1

Finland EFD

Against (1)

1

Denmark EFD

Abstain (1)

1
icon: GUE/NGL GUE/NGL
28

Portugal GUE/NGL

3

Greece GUE/NGL

Abstain (1)

2

Ireland GUE/NGL

Abstain (1)

1

Sweden GUE/NGL

Abstain (1)

1

Croatia GUE/NGL

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1

Netherlands GUE/NGL

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1

Denmark GUE/NGL

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1

Latvia GUE/NGL

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1

Cyprus GUE/NGL

2

United Kingdom GUE/NGL

Abstain (1)

1

Czechia GUE/NGL

Abstain (1)

1
icon: NI NI
23

Spain NI

1

Italy NI

For (1)

1

France NI

2
2

Hungary NI

2

Bulgaria NI

Against (1)

1

Belgium NI

Against (1)

1

Ireland NI

For (1)

1
5

United Kingdom NI

2
icon: ECR ECR
42

Italy ECR

For (1)

1

Hungary ECR

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1

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1

Croatia ECR

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1

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1

Denmark ECR

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1

A7-0065/2014 - Wolf Klinz - Résolution

2014/02/26 Outcome: +: 560, -: 55, 0: 19
DE ES IT PL FR GB RO HU BE BG SE SK EL PT NL FI CZ IE LT HR AT LU SI MT DK EE LV CY
Total
88
51
52
43
61
54
26
19
19
16
18
12
16
18
24
12
12
12
9
11
16
6
6
6
9
5
7
5
icon: PPE PPE
228

Czechia PPE

1

Luxembourg PPE

3

Malta PPE

2

Estonia PPE

For (1)

1

Cyprus PPE

1
icon: S&D S&D
159

Netherlands S&D

3

Finland S&D

2

Czechia S&D

2

Ireland S&D

2

Luxembourg S&D

For (1)

1

Slovenia S&D

For (1)

1

Estonia S&D

For (1)

1
icon: ALDE ALDE
73
4

Slovakia ALDE

For (1)

1

Greece ALDE

1

Ireland ALDE

Abstain (1)

4

Lithuania ALDE

1

Austria ALDE

1

Luxembourg ALDE

For (1)

1

Slovenia ALDE

For (1)

1

Denmark ALDE

2
2

Latvia ALDE

For (1)

1
icon: Verts/ALE Verts/ALE
53

United Kingdom Verts/ALE

5

Sweden Verts/ALE

3

Greece Verts/ALE

1

Portugal Verts/ALE

For (1)

1

Netherlands Verts/ALE

3

Finland Verts/ALE

2

Austria Verts/ALE

1

Luxembourg Verts/ALE

For (1)

1

Denmark Verts/ALE

For (1)

1

Estonia Verts/ALE

For (1)

1

Latvia Verts/ALE

Abstain (1)

1
icon: ECR ECR
43

Hungary ECR

For (1)

1

Netherlands ECR

For (1)

1

Lithuania ECR

1

Croatia ECR

For (1)

1

Denmark ECR

For (1)

1
icon: EFD EFD
25

France EFD

Against (1)

1

Belgium EFD

Abstain (1)

1

Bulgaria EFD

For (1)

1

Greece EFD

2

Netherlands EFD

Abstain (1)

1

Finland EFD

Against (1)

1

Lithuania EFD

For (1)

1

Denmark EFD

Against (1)

1
icon: NI NI
24

Spain NI

1

Italy NI

For (1)

1

France NI

2

United Kingdom NI

For (1)

3
2

Hungary NI

For (1)

Against (1)

2

Belgium NI

Against (1)

1

Bulgaria NI

Against (1)

1

Ireland NI

For (1)

1
icon: GUE/NGL GUE/NGL
28

United Kingdom GUE/NGL

Against (1)

1

Sweden GUE/NGL

Against (1)

1

Greece GUE/NGL

2

Portugal GUE/NGL

3

Netherlands GUE/NGL

Against (1)

1

Czechia GUE/NGL

Against (1)

1

Ireland GUE/NGL

Against (1)

1

Croatia GUE/NGL

Against (1)

1

Denmark GUE/NGL

Against (1)

1

Latvia GUE/NGL

Against (1)

1

Cyprus GUE/NGL

2
AmendmentsDossier
204 2013/2175(INI)
2013/11/15 EMPL 30 amendments...
source: PE-522.886
2013/11/28 REGI 19 amendments...
source: PE-524.652
2013/12/05 ECON 155 amendments...
source: PE-523.019

History

(these mark the time of scraping, not the official date of the change)

committees/0
type
Responsible Committee
body
EP
associated
False
committee_full
Economic and Monetary Affairs
committee
ECON
rapporteur
name: KLINZ Wolf date: 2013-06-18T00:00:00 group: Alliance of Liberals and Democrats for Europe abbr: ALDE
shadows
committees/0
type
Responsible Committee
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EP
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committee_full
Economic and Monetary Affairs
committee
ECON
date
2013-06-18T00:00:00
rapporteur
name: KLINZ Wolf group: Alliance of Liberals and Democrats for Europe abbr: ALDE
shadows
committees/1
type
Committee Opinion
body
EP
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False
committee_full
Employment and Social Affairs
committee
EMPL
rapporteur
name: GUTIÉRREZ PRIETO Sergio date: 2013-09-11T00:00:00 group: Progressive Alliance of Socialists and Democrats abbr: S&D
committees/1
type
Committee Opinion
body
EP
associated
False
committee_full
Employment and Social Affairs
committee
EMPL
date
2013-09-11T00:00:00
rapporteur
name: GUTIÉRREZ PRIETO Sergio group: Progressive Alliance of Socialists and Democrats abbr: S&D
committees/5
type
Committee Opinion
body
EP
associated
False
committee_full
Regional Development
committee
REGI
rapporteur
name: ZELLER Joachim date: 2013-07-11T00:00:00 group: European People's Party (Christian Democrats) abbr: PPE
committees/5
type
Committee Opinion
body
EP
associated
False
committee_full
Regional Development
committee
REGI
date
2013-07-11T00:00:00
rapporteur
name: ZELLER Joachim group: European People's Party (Christian Democrats) abbr: PPE
docs/4/body
EC
events/0
date
2013-03-25T00:00:00
type
Non-legislative basic document published
body
EC
docs
summary
events/0
date
2013-03-25T00:00:00
type
Non-legislative basic document published
body
EC
docs
summary
events/3/docs/0/url
Old
http://www.europarl.europa.eu/sides/getDoc.do?type=REPORT&mode=XML&reference=A7-2014-0065&language=EN
New
http://www.europarl.europa.eu/doceo/document/A-7-2014-0065_EN.html
events/5/docs/0/url
Old
http://www.europarl.europa.eu/sides/getDoc.do?type=TA&language=EN&reference=P7-TA-2014-0161
New
http://www.europarl.europa.eu/doceo/document/TA-7-2014-0161_EN.html
activities
  • date: 2013-03-25T00:00:00 docs: url: http://eur-lex.europa.eu/smartapi/cgi/sga_doc?smartapi!celexplus!prod!DocNumber&lg=EN&type_doc=COMfinal&an_doc=2013&nu_doc=150 title: COM(2013)0150 type: Non-legislative basic document published celexid: CELEX:52013DC0150:EN body: EC commission: DG: url: http://ec.europa.eu/dgs/economy_finance/index_en.htm title: Economic and Financial Affairs Commissioner: REHN Olli type: Non-legislative basic document published
  • date: 2013-09-12T00:00:00 body: EP type: Committee referral announced in Parliament, 1st reading/single reading committees: body: EP responsible: False committee_full: Culture and Education committee: CULT body: EP shadows: group: PPE name: PALLONE Alfredo group: S&D name: HOANG NGOC Liem group: Verts/ALE name: EICKHOUT Bas group: ECR name: FORD Vicky group: GUE/NGL name: CHOUNTIS Nikolaos responsible: True committee: ECON date: 2013-06-18T00:00:00 committee_full: Economic and Monetary Affairs rapporteur: group: ALDE name: KLINZ Wolf body: EP responsible: False committee: EMPL date: 2013-09-11T00:00:00 committee_full: Employment and Social Affairs rapporteur: group: S&D name: GUTIÉRREZ PRIETO Sergio body: EP responsible: False committee_full: Environment, Public Health and Food Safety committee: ENVI body: EP responsible: False committee_full: Industry, Research and Energy committee: ITRE body: EP responsible: False committee: REGI date: 2013-07-11T00:00:00 committee_full: Regional Development rapporteur: group: PPE name: ZELLER Joachim body: EP responsible: False committee_full: Transport and Tourism committee: TRAN
  • date: 2014-01-22T00:00:00 body: EP type: Vote in committee, 1st reading/single reading committees: body: EP responsible: False committee_full: Culture and Education committee: CULT body: EP shadows: group: PPE name: PALLONE Alfredo group: S&D name: HOANG NGOC Liem group: Verts/ALE name: EICKHOUT Bas group: ECR name: FORD Vicky group: GUE/NGL name: CHOUNTIS Nikolaos responsible: True committee: ECON date: 2013-06-18T00:00:00 committee_full: Economic and Monetary Affairs rapporteur: group: ALDE name: KLINZ Wolf body: EP responsible: False committee: EMPL date: 2013-09-11T00:00:00 committee_full: Employment and Social Affairs rapporteur: group: S&D name: GUTIÉRREZ PRIETO Sergio body: EP responsible: False committee_full: Environment, Public Health and Food Safety committee: ENVI body: EP responsible: False committee_full: Industry, Research and Energy committee: ITRE body: EP responsible: False committee: REGI date: 2013-07-11T00:00:00 committee_full: Regional Development rapporteur: group: PPE name: ZELLER Joachim body: EP responsible: False committee_full: Transport and Tourism committee: TRAN
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  • date: 2013-11-05T00:00:00 docs: url: http://www.europarl.europa.eu/sides/getDoc.do?type=COMPARL&mode=XML&language=EN&reference=PE519.604 title: PE519.604 type: Committee draft report body: EP
  • date: 2013-12-05T00:00:00 docs: url: http://www.europarl.europa.eu/sides/getDoc.do?type=COMPARL&mode=XML&language=EN&reference=PE523.019 title: PE523.019 type: Amendments tabled in committee body: EP
  • date: 2013-12-11T00:00:00 docs: url: http://www.europarl.europa.eu/sides/getDoc.do?type=COMPARL&mode=XML&language=EN&reference=PE522.847&secondRef=02 title: PE522.847 committee: EMPL type: Committee opinion body: EP
  • date: 2013-12-20T00:00:00 docs: url: http://www.europarl.europa.eu/sides/getDoc.do?type=COMPARL&mode=XML&language=EN&reference=PE522.948&secondRef=02 title: PE522.948 committee: REGI type: Committee opinion body: EP
  • date: 2014-07-22T00:00:00 docs: url: /oeil/spdoc.do?i=24078&j=0&l=en title: SP(2014)447 type: Commission response to text adopted in plenary
events
  • date: 2013-03-25T00:00:00 type: Non-legislative basic document published body: EC docs: url: http://www.europarl.europa.eu/registre/docs_autres_institutions/commission_europeenne/com/2013/0150/COM_COM(2013)0150_FR.pdf title: COM(2013)0150 url: https://eur-lex.europa.eu/smartapi/cgi/sga_doc?smartapi!celexplus!prod!DocNumber&lg=EN&type_doc=COMfinal&an_doc=2013&nu_doc=150 title: EUR-Lex summary: PURPOSE: to launch a debate on how to improve the possibilities of long-term financing of the European Union (Commission Green Paper). BACKGROUND: to return to a path of growth and crating jobs building on its areas of competitive advantage, Europe faces large-scale, long-term investment needs. This relates to investment in energy, transport and communication or housing infrastructure, in industrial and service facilities, climate change-related and eco-innovation technologies or in assets, such as education and research and development. Trends in climate change and the depletion of natural resources further underline the sustainable growth challenge, as they call for more long-term investment in low-carbon energy, energy and resource efficiency and infrastructure. To fund these long-term investments, governments and businesses need access to predictable, long-term financing . The capacity of the economy to make such long-term financing available depends on the ability of the financial system to channel the savings of governments, companies and households effectively and efficiently to the right users and uses. This can be carried out indirectly by various intermediaries (e.g. banks, insurers and pension funds) and directly by access to capital markets. The financial crisis has affected the ability of the financial sector in Europe to channel savings to long-term investment needs. Above all, it has created a climate of uncertainty and risk aversion, particularly in those Member States under financial pressure and for SMEs. In this context, the Commission considers that it is urgent to give consideration as to how the availability of long-term financing might be improved. That is the purpose of this Green Paper. CONTENT: by means of this Green Paper, the Commission is seeking to initiate a broad debate about how to foster the supply of long-term financing and how to improve and diversify the system of financial intermediation for long-term investment in Europe by allowing significantly higher shares of direct capital market financing and greater involvement of institutional investors and alternative financial markets. The focus is on long-lived capital goods (such as economic and social infrastructure, buildings and R&D, education and innovation), not because they are more important for growth than shorter-lived capital goods (such as computers, mobile phones and vehicles). Rather, investment volumes for short-lived capital goods are strongly pro-cyclical. These volumes are currently down because of the weak macroeconomic outlook in Europe. As part of the measures taken in response to the crisis, the Commission considers that the new regulatory and prudential framework must be calibrated, including in the area of taxation, in such a way as to enable and provide an incentive to the financial sector to support the real economy without jeopardising financial stability . On this basis, action to enhance the long-term financing of the European economy should address a broad range of interconnected factors : the capacity of financial institutions to channel long-term finance: given the evolving nature of the banking sector, the Green Paper asks the question as to what is the role of the banks, national and multilateral development banks and institutional investors (insurance companies, life assurance, pension funds, mutual funds and endowments) going forward in the financing of long-term investments; the efficiency and effectiveness of financial markets to offer long-term financing instruments: the questions relate to: (i) the improvement of capital market financing of long-term investment; (ii) the contribution of capital markets to filling the equity gap in Europe; (iii) the pros and cons of developing a more harmonised framework for covered bonds; (iv) ways to revive the securitisation market in the EU; cross-cutting factors enabling long-term saving and financing: (i) the setting in place of specific vehicles at EU level, more directly linked to general social objectives with a view to mobilising long-term savings; (ii) identification of the types of corporate tax incentives that are beneficial; (iii) deepening tax coordination in the EU; (iv) what kinds of tax incentives could help to promote better long-term shareholder engagement; the ease of SMEs to access bank and non-bank financing: the Commission considers that additional measures could be envisaged, such as: (i) the development of venture capital; (ii) the development of dedicated markets and networks for SMEs; (iii) the development of standards for credit scoring assessments of SMEs; (iv) the development of “non-traditional” sources of finance, such as leasing, supply-chain finance or funding via the internet (e.g. crowdfunding). On the basis of the outcome of this consultation, the Commission will consider the appropriate actions to pursue further. Stakeholders are invited to send their comments by 25 June 2013.
  • date: 2013-09-12T00:00:00 type: Committee referral announced in Parliament, 1st reading/single reading body: EP
  • date: 2014-01-22T00:00:00 type: Vote in committee, 1st reading/single reading body: EP
  • date: 2014-01-29T00:00:00 type: Committee report tabled for plenary, single reading body: EP docs: url: http://www.europarl.europa.eu/sides/getDoc.do?type=REPORT&mode=XML&reference=A7-2014-0065&language=EN title: A7-0065/2014 summary: The Committee on Economic and Monetary Affairs adopted the own-initiative report by Wolf Klinz (ALDE, DE) on long-term financing of the European economy in response to the Commission Green Paper on the subject. It noted that banks in the EU provided over 75 % of long-term financing, which created significant dependence on this funding source, while in the US less than 20 % of all long-term financing is provided by banks, and a large majority through well-developed capital markets. Members stressed that there was a persistent lack of confidence and a high level of risk aversion on the part of both private and institutional investors, and the low-interest environment, low growth projections, and economic uncertainty had significantly decreased the supply of long-term financing and the risk appetite for long-term projects. Barriers to growth : the report points to limited public financing and the need for investors in the banking and insurance sectors to adapt their business models to evolving and tightened regulatory requirements. It called on the Commission, in cooperation with the European Systemic Risk Board, to assess systemic risks to capital markets and society at large owing to the overhang of unburnable carbon assets. Alternative funding mechanisms: Members stressed the need for Member States to establish new sources to complement established mechanisms and fill the funding gap, and proposed that consideration be given to the creation of an investment section in the EU budget . They emphasised the strengthened role of new, innovative financial instruments in all the funding covered by the European Structural and Investment Funds, and the need for legal clarity and transparency of the new off-the-shelf financial instruments. The report also called for: · an enhanced European framework for less liquid investment funds in order to channel private households’ short-term liquidity into long-term investments and provide an additional retirement solution; · a harmonised approach to the long-term valuation of projects of general interest supported with public resources at the EU and national levels; · appropriate networks for cooperation and the exchange of information, and national or regional long-term public investors which can learn from the best practice of already established institutions; · ways to support Member States requiring financial and technical assistance to set up their long-term national and regional public investors, and to study the possibility of an EU guarantee mechanism for long-term national public investors ; · improved access to capital markets through new sources of funding such as initial public offerings, crowd funding, peer-to-peer lending and (covered) bonds or through new market segments; · strengthening both the banking system, including cooperative and public savings banks, and banks’ ability to access long-term refinancing to cover their long-term investments; · further assessment of the role of venture capital and private equity firms in financing the EU economy. Regulatory environment : Members emphasised that an investor-friendly business climate with a strong drive for technological progress is a prerequisite for making the EU an attractive destination for foreign direct investment. Such an environment would feature initiatives aimed at pooling financial resources, a sound taxation system, appropriate accounting principles, effective corporate governance and efficient prudential regulation - all embedded in a functioning single market. Members believed that a specific impact assessment of long-term financing should be included in any legislative proposals for relevant financial services regulation. They encouraged the Commission to follow closely the G20's work on proposals to create a multilateral investment framework that set minimum standards and modified certain long-term investment regulations and fair value accounting rules. The Commission was also asked to assess the impact of Member States’ tax incentives on long-term finance and the energy transition. Lastly, the committee asked for SMEs to be given priority access to European long-term investment funds (ELTIFs), since they constituted the backbone of growth and job creation in the EU.
  • date: 2014-02-26T00:00:00 type: Results of vote in Parliament body: EP docs: url: https://oeil.secure.europarl.europa.eu/oeil/popups/sda.do?id=24078&l=en title: Results of vote in Parliament
  • date: 2014-02-26T00:00:00 type: Decision by Parliament, 1st reading/single reading body: EP docs: url: http://www.europarl.europa.eu/sides/getDoc.do?type=TA&language=EN&reference=P7-TA-2014-0161 title: T7-0161/2014 summary: The European Parliament adopted by 560 votes to 55 with 19 abstentions a resolution on long-term financing of the European economy in response to the Commission Green Paper on the subject. Members stressed that there was a persistent lack of confidence and a high level of risk aversion on the part of both private and institutional investors, and the low-interest environment, low growth projections, and economic uncertainty had significantly decreased the supply of long-term financing and the risk appetite for long-term projects. Reasoning: Parliament stated that concrete advances needed to be made as a matter of urgency in order to relaunch long-term investment and job creation in the EU. Training and education costs should be treated as long-term investments in this respect. It noted that banks in the EU provided over 75 % of long-term financing, which created significant dependence on this funding source, while in the US less than 20 % of all long-term financing is provided by banks, and a large majority through well-developed capital markets. Emphasising that fiscal consolidation was the priority for public budgets with a view to restoring compliance with the Stability and Growth Pact and the ‘two-pack’, Parliament supported the initiative aimed at enhancing private investment in long-term financing. Barriers to growth : the resolution noted that some countries we re facing serious obstacles to, or even being denied, access to capital markets because they have contracted excessive levels of debt in recent years, while capital markets were the main cause of the recent crisis . F urther more , SMEs in many Member States we re having great difficulty accessing ca pital because commercial banks we re only prepared to grant loans subject to unduly tough conditions . Parliament pointed to limited public financing and the need for investors in the banking and insurance sectors to adapt their business models to evolving and tightened regulatory requirements. It called on the Commission to assess systemic risks to capital markets and society at large owing to the overhang of unburnable carbon assets. Alternative funding mechanisms: Parliament stressed the need for Member States to establish new sources to complement established mechanisms and fill the funding gap, and proposed that consideration be given to the creation of an investment section in the EU budget . It emphasised the strengthened role of new, innovative financial instruments in all the funding covered by the European Structural and Investment Funds, and the need for legal clarity and transparency of the new off-the-shelf financial instruments. Parliament also called for: · an enhanced European framework for less liquid investment funds in order to channel private households’ short-term liquidity into long-term investments and provide an additional retirement solution; · a harmonised approach to the long-term valuation of projects of general interest supported with public resources at the EU and national levels; · appropriate networks for cooperation and the exchange of information, and national or regional long-term public investors which can learn from the best practice of already established institutions; · ways to support Member States requiring financial and technical assistance to set up their long-term national and regional public investors, and to study the possibility of an EU guarantee mechanism for long-term national public investors ; · improved access to capital markets through new sources of funding such as initial public offerings, crowd funding, peer-to-peer lending and (covered) bonds or through new market segments; · strengthening both the banking system, including cooperative and public savings banks, and banks’ ability to access long-term refinancing to cover their long-term investments; · further assessment of the role of venture capital and private equity firms in financing the EU economy. Regulatory environment : Parliament emphasised that an investor-friendly business climate with a strong drive for technological progress is a prerequisite for making the EU an attractive destination for foreign direct investment. Such an environment would feature initiatives aimed at pooling financial resources, a sound taxation system, appropriate accounting principles, effective corporate governance and efficient prudential regulation - all embedded in a functioning single market. Parliament believed that a specific impact assessment of long-term financing should be included in any legislative proposals for relevant financial services regulation. It encouraged the Commission to follow closely the G20's work on proposals to create a multilateral investment framework that set minimum standards and modified certain long-term investment regulations and fair value accounting rules. The Commission was also asked to assess the impact of Member States’ tax incentives on long-term finance and the energy transition. Parliament asked for SMEs to be given priority access to European long-term investment funds (ELTIFs), since they constituted the backbone of growth and job creation in the EU. Lastly, Parliament stressed the need for a reliabl e tax environment that prevented impe diments to long-term investment, and encouraged Member States and the Commission to assess the possibility of granting tax-advantageous yields on sustainable infrastructure projects or other tax incentives and concessions to promote long-term investment .
  • date: 2014-02-26T00:00:00 type: End of procedure in Parliament body: EP
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  • type: Decision by Parliament, 1st reading/single reading title: T7-0161/2014
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  • The Committee on Economic and Monetary Affairs adopted the own-initiative report by Wolf Klinz (ALDE, DE) on long-term financing of the European economy in response to the Commission Green Paper on the subject. It noted that banks in the EU provided over 75 % of long-term financing, which created significant dependence on this funding source, while in the US less than 20 % of all long-term financing is provided by banks, and a large majority through well-developed capital markets. Members stressed that there was a persistent lack of confidence and a high level of risk aversion on the part of both private and institutional investors, and the low-interest environment, low growth projections, and economic uncertainty had significantly decreased the supply of long-term financing and the risk appetite for long-term projects.

    Barriers to growth: the report points to limited public financing and the need for investors in the banking and insurance sectors to adapt their business models to evolving and tightened regulatory requirements. It called on the Commission, in cooperation with the European Systemic Risk Board, to assess systemic risks to capital markets and society at large owing to the overhang of unburnable carbon assets.

    Alternative funding mechanisms: Members stressed the need for Member States to establish new sources to complement established mechanisms and fill the funding gap, and proposed that consideration be given to the creation of an investment section in the EU budget. They emphasised the strengthened role of new, innovative financial instruments in all the funding covered by the European Structural and Investment Funds, and the need for legal clarity and transparency of the new off-the-shelf financial instruments. 

    The report also called for:

    ·        an enhanced European framework for less liquid investment funds in order to channel private households’ short-term liquidity into long-term investments and provide an additional retirement solution;

    ·        a harmonised approach to the long-term valuation of projects of general interest supported with public resources at the EU and national levels;

    ·        appropriate networks for cooperation and the exchange of information, and national or regional long-term public investors which can learn from the best practice of already established institutions;

    ·        ways to support Member States requiring financial and technical assistance to set up their long-term national and regional public investors, and to study the possibility of an EU guarantee mechanism for long-term national public investors;

    ·        improved access to capital markets through new sources of funding such as initial public offerings, crowd funding, peer-to-peer lending and (covered) bonds or through new market segments;

    ·        strengthening both the banking system, including cooperative and public savings banks, and banks’ ability to access long-term refinancing to cover their long-term investments;

    ·        further assessment of the role of venture capital and private equity firms in financing the EU economy.

    Regulatory environment: Members emphasised that an investor-friendly business climate with a strong drive for technological progress is a prerequisite for making the EU an attractive destination for foreign direct investment. Such an environment would feature initiatives aimed at pooling financial resources, a sound taxation system, appropriate accounting principles, effective corporate governance and efficient prudential regulation - all embedded in a functioning single market. Members believed that a specific impact assessment of long-term financing should be included in any legislative proposals for relevant financial services regulation.

    They encouraged the Commission to follow closely the G20's work on proposals to create a multilateral investment framework that set minimum standards and modified certain long-term investment regulations and fair value accounting rules. The Commission was also asked to assess the impact of Member States’ tax incentives on long-term finance and the energy transition. 

    Lastly, the committee asked for SMEs to be given priority access to European long-term investment funds (ELTIFs), since they constituted the backbone of growth and job creation in the EU.

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  • PURPOSE: to launch a debate on how to improve the possibilities of long-term financing of the European Union (Commission Green Paper).

    BACKGROUND: to return to a path of growth and crating jobs building on its areas of competitive advantage, Europe faces large-scale, long-term investment needs. This relates to investment in energy, transport and communication or housing infrastructure, in industrial and service facilities, climate change-related and eco-innovation technologies or in assets, such as education and research and development.

    Trends in climate change and the depletion of natural resources further underline the sustainable growth challenge, as they call for more long-term investment in low-carbon energy, energy and resource efficiency and infrastructure.

    To fund these long-term investments, governments and businesses need access to predictable, long-term financing. The capacity of the economy to make such long-term financing available depends on the ability of the financial system to channel the savings of governments, companies and households effectively and efficiently to the right users and uses. This can be carried out indirectly by various intermediaries (e.g. banks, insurers and pension funds) and directly by access to capital markets.

    The financial crisis has affected the ability of the financial sector in Europe to channel savings to long-term investment needs. Above all, it has created a climate of uncertainty and risk aversion, particularly in those Member States under financial pressure and for SMEs.

    In this context, the Commission considers that it is urgent to give consideration as to how the availability of long-term financing might be improved. That is the purpose of this Green Paper.

    CONTENT: by means of this Green Paper, the Commission is seeking to initiate a broad debate about how to foster the supply of long-term financing and how to improve and diversify the system of financial intermediation for long-term investment in Europe by allowing significantly higher shares of direct capital market financing and greater involvement of institutional investors and alternative financial markets.

    The focus is on long-lived capital goods (such as economic and social infrastructure, buildings and R&D, education and innovation), not because they are more important for growth than shorter-lived capital goods (such as computers, mobile phones and vehicles). Rather, investment volumes for short-lived capital goods are strongly pro-cyclical. These volumes are currently down because of the weak macroeconomic outlook in Europe.

    As part of the measures taken in response to the crisis, the Commission considers that the new regulatory and prudential framework must be calibrated, including in the area of taxation, in such a way as to enable and provide an incentive to the financial sector to support the real economy without jeopardising financial stability.

    On this basis, action to enhance the long-term financing of the European economy should address a broad range of interconnected factors:

    1. the capacity of financial institutions to channel long-term finance: given the evolving nature of the banking sector, the Green Paper asks the question as to what is the role of the banks, national and multilateral development banks and institutional investors (insurance companies, life assurance, pension funds, mutual funds and endowments) going forward in the financing of long-term investments;
    2. the efficiency and effectiveness of financial markets to offer long-term financing instruments: the questions relate to: (i) the improvement of capital market financing of long-term investment; (ii) the contribution of capital markets to filling the equity gap in Europe; (iii) the pros and cons of developing a more harmonised framework for covered bonds; (iv) ways to revive the securitisation market in the EU;
    3. cross-cutting factors enabling long-term saving and financing: (i) the setting in place of specific vehicles at EU level, more directly linked to general social objectives with a view to mobilising long-term savings; (ii) identification of the types of corporate tax incentives that are beneficial; (iii) deepening tax coordination in the EU; (iv) what kinds of tax incentives could help to promote better long-term shareholder engagement;
    4. the ease of SMEs to access bank and non-bank financing: the Commission considers that additional measures could be envisaged, such as: (i) the development of venture capital; (ii) the development of dedicated markets and networks for SMEs; (iii) the development of standards for credit scoring assessments of SMEs; (iv) the development of “non-traditional” sources of finance, such as leasing, supply-chain finance or funding via the internet (e.g. crowdfunding).

    On the basis of the outcome of this consultation, the Commission will consider the appropriate actions to pursue further. Stakeholders are invited to send their comments by 25 June 2013.

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  • PURPOSE: to launch a debate on how to improve the possibilities of long-term financing of the European Union (Commission Green Paper).

    BACKGROUND: to return to a path of growth and crating jobs building on its areas of competitive advantage, Europe faces large-scale, long-term investment needs. This relates to investment in energy, transport and communication or housing infrastructure, in industrial and service facilities, climate change-related and eco-innovation technologies or in assets, such as education and research and development.

    Trends in climate change and the depletion of natural resources further underline the sustainable growth challenge, as they call for more long-term investment in low-carbon energy, energy and resource efficiency and infrastructure.

    To fund these long-term investments, governments and businesses need access to predictable, long-term financing. The capacity of the economy to make such long-term financing available depends on the ability of the financial system to channel the savings of governments, companies and households effectively and efficiently to the right users and uses. This can be carried out indirectly by various intermediaries (e.g. banks, insurers and pension funds) and directly by access to capital markets.

    The financial crisis has affected the ability of the financial sector in Europe to channel savings to long-term investment needs. Above all, it has created a climate of uncertainty and risk aversion, particularly in those Member States under financial pressure and for SMEs.

    In this context, the Commission considers that it is urgent to give consideration as to how the availability of long-term financing might be improved. That is the purpose of this Green Paper.

    CONTENT: by means of this Green Paper, the Commission is seeking to initiate a broad debate about how to foster the supply of long-term financing and how to improve and diversify the system of financial intermediation for long-term investment in Europe by allowing significantly higher shares of direct capital market financing and greater involvement of institutional investors and alternative financial markets.

    The focus is on long-lived capital goods (such as economic and social infrastructure, buildings and R&D, education and innovation), not because they are more important for growth than shorter-lived capital goods (such as computers, mobile phones and vehicles). Rather, investment volumes for short-lived capital goods are strongly pro-cyclical. These volumes are currently down because of the weak macroeconomic outlook in Europe.

    As part of the measures taken in response to the crisis, the Commission considers that the new regulatory and prudential framework must be calibrated, including in the area of taxation, in such a way as to enable and provide an incentive to the financial sector to support the real economy without jeopardising financial stability.

    On this basis, action to enhance the long-term financing of the European economy should address a broad range of interconnected factors:

    1. the capacity of financial institutions to channel long-term finance: given the evolving nature of the banking sector, the Green Paper asks the question as to what is the role of the banks, national and multilateral development banks and institutional investors (insurance companies, life assurance, pension funds, mutual funds and endowments) going forward in the financing of long-term investments;
    2. the efficiency and effectiveness of financial markets to offer long-term financing instruments: the questions relate to: (i) the improvement of capital market financing of long-term investment; (ii) the contribution of capital markets to filling the equity gap in Europe; (iii) the pros and cons of developing a more harmonised framework for covered bonds; (iv) ways to revive the securitisation market in the EU;
    3. cross-cutting factors enabling long-term saving and financing: (i) the setting in place of specific vehicles at EU level, more directly linked to general social objectives with a view to mobilising long-term savings; (ii) identification of the types of corporate tax incentives that are beneficial; (iii) deepening tax coordination in the EU; (iv) what kinds of tax incentives could help to promote better long-term shareholder engagement;
    4. the ease of SMEs to access bank and non-bank financing: the Commission considers that additional measures could be envisaged, such as: (i) the development of venture capital; (ii) the development of dedicated markets and networks for SMEs; (iii) the development of standards for credit scoring assessments of SMEs; (iv) the development of “non-traditional” sources of finance, such as leasing, supply-chain finance or funding via the internet (e.g. crowdfunding).

    On the basis of the outcome of this consultation, the Commission will consider the appropriate actions to pursue further. Stakeholders are invited to send their comments by 25 June 2013.

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Long-term financing of the European economy
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