2022/0405(COD) | [ParlTrack]

download json

2022/0405(COD) Making public capital markets in the Union more attractive for companies and facilitating access to capital for small and medium-sized enterprises

Progress: Awaiting Parliament's position in 1st reading

Role	Committee	Rapporteur	Shadows
Lead	ECON	SANT Alfred ( S&D)	VAIDERE Inese ( EPP), POPTCHEVA Eva Maria ( Renew), GRUFFAT Claude ( Verts/ALE), GRANT Valentino ( ID), VAN OVERTVELDT Johan ( ECR), PAPADIMOULIS Dimitrios ( GUE/NGL)
Committee Opinion	ITRE
Committee Opinion	JURI

Lead committee dossier:

ECON/9/10906

Legal Basis:

RoP 57, TFEU 050, TFEU 051-p2, TFEU 114

Subjects

Events

2023/11/09

EP - Committee decision to enter into interinstitutional negotiations confirmed by plenary (Rule 71)

2023/11/08

EP - Committee decision to enter into interinstitutional negotiations announced in plenary (Rule 71)

2023/10/26

EP - Committee report tabled for plenary, 1st reading

Details

The Committee on Economic and Monetary Affairs adopted the report by Alfred SANT (S&D, MT) on the proposal for a directive of the European Parliament and of the Council amending Directive 2014/65/EU to make public capital markets in the Union more attractive for companies and to facilitate access to capital for small and medium-sized enterprises and repealing Directive 2001/34/EC.

The committee responsible recommended that the European Parliament's position adopted at first reading under the ordinary legislative procedure should amend the proposal as follows:

General principles and information to clients

Members called on the ESMA to develop draft regulatory technical standards to establish a harmonised Union code of conduct for issuer-sponsored research . The code of conduct shall set out minimum standards of independency and objectivity to be complied with by the providers of such research and specify procedures for the identification and prevention of conflicts of interest.

The Union-wide code of conduct for issuer-sponsored research should be made publicly available on ESMA’s website.

Research that is labelled as issuer-sponsored research should indicate on its front page in a clear and prominent way that it has been prepared in accordance with the Union code of conduct. Any other research material paid fully or in part by the issuer but not prepared in compliance with the Union code of conduct should be labelled as marketing communication. Member States should ensure that competent authorities have the necessary supervisory and investigative powers to enforce compliance by investment firms producing or using issuer-sponsored research with the Union code of conduct.

Obligation to execute orders on terms most favourable to the client

Member States should require that investment firms take all sufficient steps to obtain, when executing orders, the best possible result for their clients taking into account price, costs, speed, likelihood of execution and settlement, size, nature, the provision of investment research, or any other consideration relevant to the execution of the order.

ESMA should develop guidelines on how investment firms providing portfolio management or other investment or ancillary services to clients can comply with their best execution obligations when the investment firm uses joint payments for execution services and research.

SME growth markets

The amended text proposed that Member States should require that a financial instrument of an issuer which is admitted to trading on an SME growth market is able to be traded on another trading venue only if the issuer has been duly informed and has not objected.

Documents

A9-0303/2023

2023/10/24

EP - Vote in committee, 1st reading

2023/10/24

EP - Committee decision to open interinstitutional negotiations with report adopted in committee

2023/07/11

EP - Amendments tabled in committee

Documents

PE751.683

2023/06/15

EP - Referral to associated committees announced in Parliament

2023/06/14

EP - Committee draft report

Documents

PE749.149

2023/03/23

ES_PARLIAMENT - Contribution

Documents

COM(2022)0760

2023/03/22

ESC - Economic and Social Committee: opinion, report

Documents

CES5409/2022

2023/02/01

EP - Committee referral announced in Parliament, 1st reading

2023/01/25

EP - SANT Alfred (S&D) appointed as rapporteur in ECON

2022/12/08

EC - Document attached to the procedure

Documents

SEC(2022)0760

2022/12/08

EC - Document attached to the procedure

Documents

EUR-Lex
SWD(2022)0762

2022/12/08

EC - Document attached to the procedure

Documents

EUR-Lex
SWD(2022)0763

2022/12/07

EC - Legislative proposal published

Details

PURPOSE: to ease EU small and medium capitalisation companies’ access to capital markets, and to increase the coherence of Union listing rules.

PROPOSED ACT: Directive of the European Parliament and of the Council.

ROLE OF THE EUROPEAN PARLIAMENT: the European Parliament decides in accordance with the ordinary legislative procedure and on an equal footing with the Council.

BACKGROUND: Directive 2014/65/EU of the European Parliament and of the Council has been amended by Regulation (EU) 2019/2115 of the European Parliament and of the Council, which introduced proportionate alleviations to enhance the use of SME growth markets and to reduce the excessive regulatory requirements for issuers seeking admission of securities on SME growth markets, while preserving an appropriate level of investor protection and market integrity. However, to streamline the listing process and to render the regulatory treatment of companies more flexible and proportionate to their size, further amendments to Directive 2014/65/EU are necessary.

Directive 2014/65/EU and Commission Delegated Directive (EU) 2017/593 30 set out the conditions under which the provision of investment research by third parties to investment firms providing portfolio management or other investment or ancillary services is not to be regarded as an inducement. To foster more investment research on companies in the Union, in particular small and medium capitalisation companies, and to bring those companies greater visibility and more prospect of attracting potential investors, it is necessary to introduce some amendments to that Directive.

This proposal is part of the Listing Act package, a set of measures to make public capital markets more attractive for EU companies and facilitate access to capital for small and medium-sized companies (SMEs).

CONTENT: the Commission proposal seeks to introduce targeted adjustments to the EU rulebook in order to enhance visibility of listed companies, especially SMEs, and streamline the listing process with a view to enhancing legal clarity.

The proposal:

- introduces a new provision regarding the qualities of investment research. It sets out that research provided by third parties shall be fair, clear and not misleading;

- includes the conditions to label research as ‘issuer-sponsored research’. Such conditions include the requirement for research to comply with a code of conduct, as well as the requirements for the content, publication and review of such code of conduct;

- clarifies that issuers may submit their issuer-sponsored research to the collection body under the proposal for a European single access point. A final clarification is added that any research material paid by the issuer but not produced in compliance with such code of conduct should be labelled as a marketing communication;

- increases the threshold of companies’ market capitalisation from EUR 1 billion to EUR 10 billion to capture a broader scope of small and medium capitalisation companies, and in particular more medium size companies;

- clarifies that a segment of multilateral trading facilities can be registered as an SME growth market and set out the conditions and requirements for its registration or de-registration;

- covers conditions for the admission of shares to trading on a regulated market. Such conditions are the EUR 1 million minimum market capitalisation requirement for companies that seek to list their shares on a regulated market, as well as a 10% minimum free float requirement. Furthermore, the Commission is empowered to adopt delegated acts to change such thresholds when they hamper the liquidity on public markets, taking into account financial developments.

Documents

COM(2022)0760
EUR-Lex

Documents

Committee report tabled for plenary, 1st reading: A9-0303/2023
Amendments tabled in committee: PE751.683
Committee draft report: PE749.149
Contribution: COM(2022)0760
Economic and Social Committee: opinion, report: CES5409/2022
Document attached to the procedure: SEC(2022)0760
Document attached to the procedure: EUR-Lex
Document attached to the procedure: SWD(2022)0762
Document attached to the procedure: EUR-Lex
Document attached to the procedure: SWD(2022)0763
Legislative proposal published: COM(2022)0760
Legislative proposal published: EUR-Lex
Document attached to the procedure: SEC(2022)0760
Document attached to the procedure: EUR-Lex SWD(2022)0762
Document attached to the procedure: EUR-Lex SWD(2022)0763
Economic and Social Committee: opinion, report: CES5409/2022
Committee draft report: PE749.149
Amendments tabled in committee: PE751.683
Contribution: COM(2022)0760

Amendments	Dossier
47	2022/0405(COD) 2023/07/11 ECON 47 amendments... Amendment 11 # Jonás FERNÁNDEZ, Pedro MARQUES, Margarida MARQUES, Paul TANG, Eero HEINÄLUOMA, René REPASI Proposal for a directive Recital 2 ~~(2) Directive 2014/65/EU and Commission D~~delegated Directive (EU) 2017/59330 set out the conditions under which the provision of investment research by third parties to investment firms providing portfolio management or other investment or ancillary services is not to be regarded as an inducement. In order to foster more investment research on companies in the Union, in particular small and medium capitalisation companies, and to bring those companies greater visibility and more prospect of attracting potential investors, it is necessary to introduce some amendments to that Directive. __________________ 30 Commission Delegated Directive (EU) 2017/593 of 7 April 2016 supplementing Directive 2014/65/EU of the European Parliament and of the Council with regard to safeguarding of financial instruments and funds belonging to clients, product governance obligations and the rules applicable to the provision or reception of fees, commissions or any monetary or non-monetary benefits (OJ L 87, 31.3.2017, p. 500). Amendment 12 # Jonás FERNÁNDEZ, Pedro MARQUES, Margarida MARQUES, Paul TANG, Eero HEINÄLUOMA, René REPASI Proposal for a directive Recital 3 (3) The provisions concerning research laid down in Directive 2014/65/EU require investment firms to separate payments which they receive as brokerage commissions from the compensation perceived for providing investment research (‘research unbundling rules’), or to pay for investment research from their own resources and assess the quality of the research they purchase based on robust quality criteria and the ability of such research to contribute to better investment decisions. In 2021, those rules have been amended by Directive (EU) 2021/338 of the European Parliament and of the Council31 to allow for bundled payments for execution services and research for small and medium capitalisation companies below a market capitalisation of EUR 1 billion. The decline of investment research has, however, not slowed down. __________________ 31 Directive (EU) 2021/338 of the European Parliament and of the Council of 16 February 2021 amending Directive 2014/65/EU as regards information requirements, product governance and position limits, and Directives 2013/36/EU and (EU) 2019/878 as regards their application to investment firms, to help the recovery from the COVID-19 crisis (OJ L 68, 26.2.2021, p. 14).deleted Amendment 13 # Eva Maria POPTCHEVA, Stéphanie YON-COURTIN, Gilles BOYER Proposal for a directive Recital 3 (3) The provisions concerning research laid down in Directive 2014/65/EU require investment firms to separate payments which they receive as brokerage commissions from the compensation perceived for providing investment research (‘research unbundling rules’), or to pay for investment research from their own resources and assess the quality of the research they purchase based on robust quality criteria and the ability of such research to contribute to better investment decisions. While the unbundling rules have created more transparency on the costs of research and allowed for a better management of conflicts of interest, they have had a negative impact on the EU’s investment research ecosystem and, particularly, on the research coverage of small and medium capitalization companies. In 2021, those rules have been amended by Directive (EU) 2021/338 of the European Parliament and of the Council31 to allow for bundled payments for execution services and research for small and medium capitalisation companies below a market capitalisation of EUR 1 billion. The decline of investment research has, however, not slowed down. __________________ 31 Directive (EU) 2021/338 of the European Parliament and of the Council of 16 February 2021 amending Directive 2014/65/EU as regards information requirements, product governance and position limits, and Directives 2013/36/EU and (EU) 2019/878 as regards their application to investment firms, to help the recovery from the COVID-19 crisis (OJ L 68, 26.2.2021, p. 14). Amendment 14 # Jonás FERNÁNDEZ, Pedro MARQUES, Margarida MARQUES, Paul TANG, Eero HEINÄLUOMA, René REPASI Proposal for a directive Recital 4 (4) In order to revitalise the market for investment research and to ensure sufficient research coverage of companies, in particular the small and medium capitalisation companies, further alleviation of the research unbundling rules are necessary. By increasing from EUR 1 billion to EUR 10 billion the threshold of companies’ market capitalisation below which the unbundling rules do not apply, more small and medium capitalisation companies, and in particular more medium capitalisation companies will benefit from a larger research coverage, bringing those companies more visibility from potential investors and thus increasing their capacity to raise funding in the markets.deleted Amendment 15 # Claude GRUFFAT Proposal for a directive Recital 4 (4) In order to revitalise the market for investment research and to ensure sufficient research coverage of companies, in particular the small and medium capitalisation companies, further alleviation of the research unbundling rules are necessary. By increasing from EUR 1 billion toSMEs continue to be characterised by lower amount of analyst research, higher probability of losing coverage, worse quality of research and limited secondary market liquidity, as compared to larger firms. According to ESMA findings, this situation appears to have been neither improved nor worsened by the MiFID II research unbundling provisions. For this reason, an expansion of the EUR 10 billion ~~the~~ threshold of companies’ market capitalisation below which the unbundling rules do not apply, more small and medium capitalisation companies, and in particular more medium capitalisation companies will benefit from a larger research coverage, bringing those companies more visibility from potential investors and thus increasing their capacity to raise funding in the marketis not likely to have a positive impact on research for small and medium capitalisation companies, while on the other hand it would reduce transparency and clarity for investors and weaken rules against conflict of interest. In order to revitalise the market for investment research and to ensure sufficient research coverage of companies, in particular the small and medium capitalisation companies, further measures are therefore necessary to promote ad strengthen the capacity to produce and distribute research through both public funding programmes and supervisory initiatives, while improving at the same time the rules to prevent conflict of interest associated with research sponsored by issuers. Amendment 16 # Eva Maria POPTCHEVA, Stéphanie YON-COURTIN, Gilles BOYER Proposal for a directive Recital 4 (4) In order to revitalise the market for investment research and to ensure sufficient research coverage of companies, in particular the small and medium capitalisation companies, ~~further alleviation of the research unbundling rules are necessary. By increasing from EUR 1~~ unbundling rules should be further adjusted. Investment firms should have more flexibillionty to EUR 10 billion the threshold of companies’ market capitalisation below which the unbundling rules do not apply, more small and medium capitalisation companies, and in particular more medium capitalisation companies will benefit from a larger research coverage, bringing those companies mochoose the way in which they wish to organise the payments of execution services and research. This would however require to maintain a level of transparency vis-a-vis the client as to the payment choice made by the investment firms. Investment firms should inform their clients whether they apply a separate or joint payment for the execution services and the provision of third party research. Appropriate information to the clients should be ensured vi~~sibility from potential investors and thus increasing their capacity to raise funding in the marke~~a the recording by the firm of the charges attributable to research and execution services and also via the provision of an annual report on those payments to the clients. Amendment 17 # Eva Maria POPTCHEVA, Stéphanie YON-COURTIN, Gilles BOYER Proposal for a directive Recital 4 a (new) (4 a) The adjustment of unbundling rules alone will not suffice to revitalize the market of research investment and address the longstanding shortage of research coverage of small and medium capitalization companies. The measures introduced in this directive should not undermine the progress made in terms of price transparency, reduction of conflicts of interest and other regulatory objectives of MiFID II. Further measures should be introduced to improve the coverage of SMEs and the promotion of independent research in the market. Amendment 18 # Claude GRUFFAT Proposal for a directive Recital 5 (5) In addition, to further support the coverage of small and medium capitalisation companies by investment research, research material paid fully or partially by issuers should be labelled as ‘issuer-sponsored research’. To ensure an adequate level of objectivity and independence of such research material, such material should be produced in line with a code of conduct developed ~~or endorsed by a market operator registered in a Member State or by a competent authority. In order to support more~~by ESMA by means of regulatory technical standards. For this purpose, investment firms should have in place governance and organisational procedures to ensure that the issuer-sponsored research they produce, use or distribute is produced in compliance with the EU code of conduct and with the requirements laid down in this Directive. Member States should ensure that competent authorities have all the necessary supervisory and investigatory powers to ensure that the investment firms comply with the requirements. In order to ensure the necessary visibility of the issuer-sponsored research, issuers should ~~have the possibility to~~ submit their issuer- sponsored research to the relevant collection body as defined32 in [Article 2 (2) of the proposal for a Regulation33 on a European Single Access Point]. __________________ 32 See Article2.2 o proposal for a Regulation [2021.78.COD] 33 Proposal for a Regulation [2021/03.78.COD] Amendment 19 # Johan VAN OVERTVELDT Proposal for a directive Recital 5 (5) In addition, to further support the coverage of small and medium capitalisation companies by investment research, research material paid fully or partially by issuers should be labelled as ‘issuer-sponsored research’. To ensure an adequate level of objectivity and independence of such research material, such material should be produced in line with a code of conduct ~~developed or endorsed by a market operator registered in a Member State or by a competent authority~~published by ESMA. In order to support more visibility of the issuer-sponsored research, issuers should have the possibility to submit their issuer-sponsored research to the relevant collection body as defined32 in ~~[Article 2 (2)~~Regulation (EU) .../... of the pEurop~~osal for a Regulation33 on~~ean Parliament and the Council33a. __________________ 33a Regulation (EU) .../... of the European Parliament and the Council establishing a European Ssingle Aaccess Ppoint~~]. __________________ 32 See Article2.2 o proposal for a Regulation [2021.78.COD] 33 Proposal for a Regulation [~~ providing centralised access to publicly available information of relevance to financial services, capital markets and sustainability (2021/03.78.(COD] )). Amendment 20 # Markus FERBER, Inese VAIDERE, Isabel BENJUMEA BENJUMEA Proposal for a directive Recital 5 (5) In addition, to further support the coverage of small and medium capitalisation companies by investment research, research material paid fully or partially by issuers should be labelled as ‘issuer-sponsored research’. To ensure an adequate level of objectivity and independence of such research material, such material should be produced in line with a code of conduct developed or endorsed by a market operator registered in a Member State or by a competent authority. In order to support more visibility of the issuer-sponsored research, issuers should have the possibility to submit their issuer-sponsored research to the relevant collection body as defined32 in [Article 2 (2) of the proposal for a Regulation33 on a European Single Access Point]. ESMA should develop minimum standards for the code of conduct in order to establish a minimum level of convergence across jurisdictions. __________________ 32 See Article2.2 o proposal for a Regulation [2021.78.COD] 33 Proposal for a Regulation [2021/03.78.COD] Amendment 21 # Danuta Maria HÜBNER, Isabel BENJUMEA BENJUMEA, Frances FITZGERALD Proposal for a directive Recital 6 a (new) (6 a) Shares in SMEs are often illiquid as they have a smaller market capitalisation, a narrower investor base, and a lower trading volume. Issuers should therefore be given the opportunity to maximise their access to capital by having their instruments available for trading for the greatest number of investors, whilst needing to be protected if being traded on another trading venue would subject them to additional disclosures obligations or responsibilities. Member States should therefore be able to require that, until the consolidated tape for shares and ETFs is established, a share of an issuer which is admitted to trading on an SME growth market may also be traded on another trading venue that imposes new obligations or responsibilities on the issuer only if the issuer has been notified and has not objected. Where admission to trading on another venue does not impose any new obligations or responsibilities, no such notification will be required. Amendment 22 # Jessica POLFJÄRD Proposal for a directive Recital 6 a (new) (6 a) Member States should require that a financial instrument of an issuer which is admitted to trading on an SME growth market may also be traded on another trading venue only if the issuer has been informed and has not objected. Shares in SMEs are often illiquid by nature as they have a smaller market capitalisation and a lower trading volume. Issuers should therefore be able to object to being traded on another trading venue, as this could be beneficial in terms of reducing the risks of fragmentation of liquidity. Amendment 23 # Christophe HANSEN Proposal for a directive Recital 7 (7) Directive 2001/34/EC of the European Parliament and of the Council34 lays down rules concerning listing on Union markets. That Directive aims at coordinating the rules on the admission of securities to official stock exchange listing and on information to be published on those securities to provide equivalent protection for investors at Union level. That Directive also lays down the rules of the regulatory and supervisory framework for Union primary markets. In the course of the years, Directive 2001/34/EC has been amended significantly several times. Directives 2003/71/EC of the European Parliament and of the Council35 and Directive 2004/109/EC of the European Parliament and of the Council36 have replaced most of the provisions harmonising the conditions for the provision of information regarding requests for the admission of securities to official stock exchange listing and the information on securities admitted to trading, and have made large parts of Directive 2001/34/EC redundant. Directive 2001/34/EC as a minimum harmonisation Directive gives Member States a rather broad discretion to deviate from the rules laid down in that Directive, which has led to market fragmentation in the Union. To drive market harmonisation at Union level and create a single rule book, Directive 2001/34/EC shouldshould therefore be repealed. __________________ 34 Directive 2001/34/EC of the European Parliament and of the Council of 28 May 2001 on the admission of securities to official stock exchange listing and on information to be published on those securities (OJ L 184, 6.7.2001, p. 1). 35 Directive 2003/71/EC of the European Parliament and of the Council of 4 November 2003 on the prospectus to be published when securities are offered to the public or admitted to trading and amending Directive 2001/34/EC (OJ L 345, 31.12.2003, p. 64). 36 Directive 2004/109/EC of the European Parliament and of the Council of 15 December 2004 on the harmonisation of transparency requirements in relation to information about issuers whose securities are admitted to trading on a regulated market and amending Directive 2001/34/EC (OJ L 390, 31.12.2004, p. 38). Amendment 24 # Inese VAIDERE, Isabel BENJUMEA BENJUMEA Proposal for a directive Recital 9 (9) To allow for more flexibility for issuers and to make Union capital markets more competitive, the minimum free float requirement should be decreased to 10%, which is a threshold that ensures for a sufficient level of liquidity in the market. In some cases, Member States should be able to allow a lower free float rate to be applied as long as alternative requirements are met to ensure a well- functioning capital market. The free float requirement laid down in Directive 2001/34/EC that a sufficient number of shares is to be distributed to the public in one or more Member States refers to the public within the Union and the European Economic Area (EU/EEA). That geographical restriction of the free float requirement to the EU/EEA should not be maintained as Directive 2014/65/EU does not provide for such restriction for financial instruments admitted to trading. The requirement that a company is to have published or filed its annual accounts for a specific period of time should not be transferred to Directive 2014/65/EU since Regulation (EU) 2017/1129 of the European Parliament and of the Council37 already contains a provision to that effect. Directive 2014/65/EU already lays down provisions to designate competent authorities. Thus, the provisions laid down in Directive 2001/34/EC to appoint one or more competent authorities are redundant. The requirement for debt securities that the amount of the loan is not be less than EUR 200 000 are considered obsolete in light of current market practice. __________________ 37 Regulation (EU) 2017/1129 of the European Parliament and of the Council of 14 June 2017 on the prospectus to be published when securities are offered to the public or admitted to trading on a regulated market, and repealing Directive 2003/71/EC (OJ L 168, 30.6.2017, p. 12). Amendment 25 # Christophe HANSEN Proposal for a directive Recital 10 (10) The concept of admission of securities to official listing on stock exchanges provided for in Directive 2001/34/EC is no longer frequently used given market developments, as Directive 2014/65/EU already provides for the concept of ‘admission of financial instruments to trading on a regulated market’. TWhile in some Member States the two concepts ‘admission to official listing’ and ‘admission to trading on a regulated market’ are ~~often~~ used interchangeably, in ~~some~~other Member States~~. That means that, in some Member States, no distinction is made between the~~ the concept of ‘admission to official listing’ continues two ~~concepts. Furthermore, the dual regime~~play an important role alongside the concept of ‘admission to trading, on the one hand, and admission to official listing, on the other hand, could lead to legal uncertainty at Union level, in particular, due to the fact that the requirements laid down in Directive 2003/71/EC, Directive 2004/109/EC and Directive 2014/57/EU of the European Parliament and of the Council38 do not apply to instruments admitted to official listing, while those requirements apply to instruments admitted to trading on a regulated marketa regulated market’, in particular by providing an alternative to issuers of securities, notably debt securities, who seek increased visibility but for whom admission to trading is not a relevant or viable option. The repeal of Directive 2001/34/EC by this Directive should be without prejudice to the validity and continuation of the regimes of ‘admission of securities to official listing’ on stock exchanges in Member States, as well as to Member States’ ability to provide for and regulate such regimes under national law. __________________ 38 Directive 2014/57/EU of the European Parliament and of the Council of 16 April 2014 on criminal sanctions for market abuse (market abuse directive) (OJ L 173, 12.6.2014, p. 179). Amendment 26 # Eva Maria POPTCHEVA, Stéphanie YON-COURTIN, Gilles BOYER Proposal for a directive Recital 11 (11) To enhance the visibility of listed companies, in particular SMEs and to adapt the listing conditions to improve requirements for issuers, the power to adopt acts in accordance with Article 290 of the Treaty on the Functioning of the European Union should be delegated to the Commission in respect of amending Directive 2014/65/EU. The market capitalisation threshold for companies, for which the re-bundling of trading execution and research fees would be possible~~, to capture small and medium capitalisation companies, and providing a framework for the development of a particular form of research for which the issuer pays should be adapted~~ should be removed while introducing safeguards to maintain a level of transparency regarding the costs associated to research. The adaption of the listing rules in the Union should also reflect market practice for it to be effective and promote competition. It is of particular importance that the Commission carry out appropriate consultations during its preparatory work, including at expert level, and that those consultations be conducted in accordance with the principles laid down in the Interinstitutional Agreement of 13 April 2016 on Better Law-Making39 . In particular, to ensure equal participation in the preparation of delegated acts, the European Parliament and the Council receive all documents at the same time as Member States' experts, and their experts systematically have access to meetings of Commission expert groups dealing with the preparation of delegated acts. __________________ 39 OJ L 123, 12.5.2016, p. 1. Amendment 27 # Eva Maria POPTCHEVA, Stéphanie YON-COURTIN, Gilles BOYER Proposal for a directive Article 1 – paragraph 1 – point 2 – point a Directive 2014/65/EU Article 24 – paragraph 3 a 3a. research ~~provided by third parties to~~used or distributed to clients or potential clients by investment firms providing portfolio management or other investment or ancillary services ~~and research prepared and distributed by such~~that has been produced by these firms, or produced by third parties and provided to these firms, shall be fair, clear and not misleading. Research shall be clearly identifiable as such or in similar terms, provided that all conditions applicable to the research are met. Amendment 28 # Claude GRUFFAT Proposal for a directive Article 1 – paragraph 1 – point 2 – point a Directive 2014/65/EU Article 24 – paragraph 3 b – subparagraph 1 Where the research is paid, fully or partially, by the issuer and disseminated to the public or to investment firms or to the clients of investment firms providing portfolio management or other investment or ancillary services, such research shall be labelled as “issuer-sponsored research” provided that it is produced in compliance with a EU code of conduct ~~developed or endorsed by a market operator registered in a Member State or by a competent authority~~for issuer- sponsored research to be developed by ESMA. Amendment 29 # Claude GRUFFAT Proposal for a directive Article 1 – paragraph 1 – point 2 – point a Directive 2014/65/EU Article 24 – paragraph 3 b – subparagraph 2 ~~The code of conduct shall set out minimum~~ESMA shall develop draft regulatory technical standards in order to specify the rules, standards of independency and objectivity to be complied with by the providers of such research~~. The market operator or the competent authority shall publish the code of conduct on its website and review and re-endorse it every 2 years~~ and the procedures for the effective identification, prevention and disclosure of conflict of interest. For the purpose of developing those regulatory technical standards, ESMA shall take into account relevant codes of conduct which have been established at national level. ESMA shall submit those draft regulatory technical standards to the Commission by [12 months after the date of entry into force of this Directive]. Power is delegated to the Commission to adopt the regulatory technical standards referred to in the second subparagraph in accordance with Articles 10 to 14 of Regulation (EU) No 1095/2010. The EU-wide code of conduct for issuer- sponsored research shall be made publicly available on ESMA’s website. Amendment 30 # Johan VAN OVERTVELDT Proposal for a directive Article 1 – paragraph 1 – point 2 – point a Directive 2014/65/EU Article 24 – paragraph 3 b – subparagraph 2 The code of conduct shall set out minimum standards of independency and objectivity to be complied with by the providers of such research. The market operator or the competent authority stha~~ll publish~~t has endorsed the code of conduct shall publish it on its website and review and re-endorse it every 2 years. Amendment 31 # Markus FERBER, Inese VAIDERE, Isabel BENJUMEA BENJUMEA Proposal for a directive Article 1 – paragraph 1 – point 2 – point a Directive 2014/65/EU Article 24 – paragraph 3 b – subparagraph 3 (new) ESMA shall develop guidelines to establish minimum standards for the code of conduct for issuer-sponsored research. Amendment 32 # Johan VAN OVERTVELDT Proposal for a directive Article 1 – paragraph 1 – point 2 – point a Directive 2014/65/EU Article 24 – paragraph 3 c 3c. Member States shall ensure that any issuer may submit its issuer- sponsored research, as referred to in paragraph 3b of this Article, to the relevant collection body as defined in [Article 2(2) of the proposal for a Regulation on a European Single Access Point40 ]. __________________ 40 Proposal for a Regulation [2021/0378.COD].deleted Amendment 33 # Claude GRUFFAT Proposal for a directive Article 1 – paragraph 1 – point 2 – point a Directive 2014/65/EU Article 24 – paragraph 3 c 3c. Member States shall ensure that ~~any~~ issuer ~~may~~s submit ~~its~~any issuer-sponsored research, as referred to in paragraph 3b of this Article, to the relevant collection body as defined in [Article 2(2) of the proposal for a Regulation on a European Single Access Point40 ]. __________________ 40 Proposal for a Regulation [2021/0378.COD]. Amendment 34 # Eva Maria POPTCHEVA, Stéphanie YON-COURTIN, Gilles BOYER Proposal for a directive Article 1 – paragraph 1 – point 2 – point a Directive 2014/65/EU Article 24 – paragraph 3 d 3d. Research that is labelled as issuer- sponsored research shall indicate on its front page in a clear and prominent way that it has been prepared in accordance with athe EU code of conduct~~. The name of the market operator or competent authority that has developed or endorsed such code of conduct shall also be mentioned~~ referred to in paragraph 3b. Any other research material paid fully or in part by the issuer but not produced in compliance with a code of conduct as referred to in paragraph 3b shall be labelled as marketing communication.; Amendment 35 # Claude GRUFFAT Proposal for a directive Article 1 – paragraph 1 – point 2 – point a Directive 2014/65/EU Article 24 – paragraph 3 d 3d. Research that is labelled as issuer- sponsored research shall indicate on its front page in a clear and prominent way that it has been prepared in accordance with a EU code of conduct~~. The name of the market operator or competent authority that has developed or endorsed such code of conduct shall also be mentioned~~. Any other research material paid fully or in part by the issuer but not produced in compliance with a code of conduct as referred to in paragraph 3b shall be labelled as marketing communication.; Amendment 36 # Claude GRUFFAT Proposal for a directive Article 1 – paragraph 1 – point 2 – point a Directive 2014/65/EU Article 24 – paragraph 3 d a (new) 3d a. Member States shall provide that investment firms that produce, use or distribute issuer-sponsored research have in place adequate governance and organisational procedures to ensure that any issuer-sponsored research is produced in compliance with the EU code of conduct developed by ESMA and with paragraph 3a to 3d of this Article. Member States shall ensure that competent authorities have the necessary supervisory and investigatory powers to ensure compliance with the relevant requirements and to suspend the distribution of any issuer-sponsored research that is not produced in compliance with the EU code of conduct. Amendment 37 # Jonás FERNÁNDEZ, Pedro MARQUES, Margarida MARQUES, Paul TANG, Eero HEINÄLUOMA, René REPASI Proposal for a directive Article 1 – paragraph 1 – point 2 – point b Directive 2014/65/EC Article 24 – paragraph 9 a – point c (b) in paragraph 9a, point (c) is replaced by the following: ‘ (c) combined charges or the joint payment is made concerns issuers whose market capitalisation for the period of 36 months preceding the provision of the research did not exceed EUR 10 billion, as expressed by end-year quotes for the years when those issuers are or were listed or by the own-capital for the financial years when those issuers are or were not listed.; ’deleted the research for which the Amendment 38 # Johan VAN OVERTVELDT Proposal for a directive Article 1 – paragraph 1 – point 2 – point b Directive 2014/65/EU Article 24 – paragraph 9 a – point c (b) in paragraph 9a, point (c) is replaced by the following: (c) the research for which the combined charges or the joint payment is made concerns issuers whose market capitalisation for the period of 36 months preceding the provision of the research did not exceed EUR 10 billion, as expressed by end-year quotes for the years when those issuers are or were listed or by the own-capital for the financial years when those issuers are or were not listed.;deleted Amendment 39 # Eva Maria POPTCHEVA, Stéphanie YON-COURTIN, Gilles BOYER Proposal for a directive Article 1 – paragraph 1 – point 2 – point b Directive 2014/65/EU Article 24 – paragraph 9 a – point c (b) in paragraph 9a, point (c) is replaced by the following: (c) combined charges or the joint payment is made concerns issuers whose market capitalisation for the period of 36 months preceding the provision of the research did not exceed EUR 10 billion, as expressed by end-year quotes for the years when those issuers are or were listed or by the own-capital for the financial years when those issuers are or were not listed.;deleted the research for which the Amendment 40 # Claude GRUFFAT Proposal for a directive Article 1 – paragraph 1 – point 2 – point b Directive 2014/65/EU Article 24 – paragraph 9 a – point c (c) the research for which the combined charges or the joint payment is made concerns issuers whose market capitalisation for the period of 36 months preceding the provision of the research did not exceed EUR 10 billion, as expressed by end-year quotes for the years when those issuers are or were listed or by the own- capital for the financial years when those issuers are or were not listed.; Amendment 41 # Johan VAN OVERTVELDT Proposal for a directive Article 1 – paragraph 1 – point 2 – point b – introductory part Directive 2014/65/EU Article 24 – paragraph 9 a (b) ~~in p~~Paragraph 9a~~, point (c) is replaced by the~~ is amended as follow~~ing~~s: Amendment 42 # Eva Maria POPTCHEVA, Stéphanie YON-COURTIN, Gilles BOYER Proposal for a directive Article 1 – paragraph 1 – point 2 – point b – introductory part Directive 2014/65/EU Article 24 – paragraph 9 a (b) in paragraph 9a~~, point (c) is replaced by the~~ is amended as follow~~ing~~s: Amendment 43 # Johan VAN OVERTVELDT Proposal for a directive Article 1 – paragraph 1 – point 2 – point b Directive 2014/65/EU Article 24 – paragraph 9 a – subparagraph 1 ~~Member States shall ensure that t~~(a) the first subparagraph is replaced by the following: 'The provision of research by third parties to investment firms providing portfolio management or other investment or ancillary services to clients is to be regarded as fulfilling the obligations under paragraph 1 if~~: (a) before the execution or research services have been provided, an agreement has been entered into between the investment firm and~~ the investment firm informs its clients about the reseparch provider, identifying the part of any combined charges or joint payments for execution services and research that is attributable to research; (b) the investment firm informs its clients about the joint paymentsate or joint payments, as the case may be, for execution services and research made to the third party providers of research; and (c) the research for which the combined charges or the joint payment is made concerns issuers whose market capitalisation for the period of 36 months preceding the provision of the research did not exceed EUR 1 billion, as expressed by end-year quotes for the years when they are or were listed or by the own-capital for the financial years when they are or were not listed.' Amendment 44 # Eva Maria POPTCHEVA, Stéphanie YON-COURTIN, Gilles BOYER Proposal for a directive Article 1 – paragraph 1 – point 2 – point b Directive 2014/65/EU Article 24 – paragraph 9 a – subparagraph 1 ~~Member States shall ensure that t~~(a) the first subparagraph is replaced by the following: 'The provision of research by third parties to investment firms providing portfolio management or other investment or ancillary services to clients is to be regarded as fulfilling the obligations under paragraph 1 if~~: (a) before the execution or research services have been provided, an agreement has been entered into between the investment firm and~~ the investment firm informs its clients about the reseparch provider, identifying the part of any combined charges or joint payments for execution services and research that is attributable to research; (b) the investment firm informs its clients about the joint payments for execution services and research made to the third party providers of research; and (c) the research for which the combined charges or the joint payment is made concerns issuers whose market capitalisation for the period of 36 months preceding the provision of the research did not exceed EUR 1 billion, as expressed by end-year quotes for the years when they are or were listed or by the own-capital for the financial years when they are or were not listed.ate or joint payments, as the case may be, for execution services and research made to the third party providers of research.' Amendment 45 # Jonás FERNÁNDEZ, Pedro MARQUES, Margarida MARQUES, Paul TANG, Eero HEINÄLUOMA, René REPASI Proposal for a directive Article 1 – paragraph 1 – point 2 – point b Directive 2014/65/EC Article 24 – paragraph 9 a – subparagraph 2 (new) (b) the following subparagraph is inserted after point (c): "Member States shall also ensure that the provision of research by third parties to investment firms providing portfolio management or other investment or ancillary services to clients is to be regarded as fulfilling the obligations under paragraph 1 if the research is provided by an independent research provider that is not engaged in execution services and is not part of a financial services group that includes an investment firm that offers execution or brokerage services;" Amendment 46 # Eva Maria POPTCHEVA, Stéphanie YON-COURTIN, Gilles BOYER Proposal for a directive Article 1 – paragraph 1 – point 2 – point b Directive 2014/65/EU Article 24 – paragraph 9 a – subparagraph 4 (new) (b) the following subparagraph is added: Investment firms shall keep a record of separate payments and gather information distinguishing the part of combined charges or joint payments for execution services and research that is attributable to research provided to such firms. Investment firms shall inform its clients annually, in an aggregated form, of the annual expenditure on research of the investment firm that is attributable to the client. Amendment 47 # Johan VAN OVERTVELDT Proposal for a directive Article 1 – paragraph 1 – point 2 – point b Directive 2014/65/EU Article 24 – paragraph 9 a – subparagraph 4 (new) (b) the following subparagraph is added: 'Investment firms may keep a record of separate payments and gather information distinguishing the part of combined charges or joint payments for execution services and research that is attributable to research provided to such firms and may inform its clients annually in an aggregated form of the annual expenditure to research of the investment firm that is attributable to the client.' Amendment 48 # Claude GRUFFAT Proposal for a directive Article 1 – paragraph 1 – point 2 – point b a (new) Directive 2014/65/EU Article 24 – paragraph 9 b (new) (b a) the following paragraph is inserted: 9b. ESMA shall establish a platform aimed at creating a "EU research marketplace" to support and develop high quality, independent research covering small and medium enterprises through a combination of public funding programmes and voluntary contributions from market participants. Such platform shall facilitate the regular exchange between competent authorities, investment service providers and research firms and have a special focus on small and midcaps and innovative stat-ups as well as on ESG research covering environmental, governance and social issues. Amendment 49 # Jonás FERNÁNDEZ, Pedro MARQUES, Margarida MARQUES, Paul TANG, Eero HEINÄLUOMA, René REPASI Proposal for a directive Article 1 – paragraph 1 – point 2 – point b a (new) Directive 2014/65/EC Article 24 – paragraph 9 b (new) (b a) the following paragraph is inserted: “9b. ESMA shall organise a procedure for the establishment of a voluntary EU-wide research marketplace focusing on research into small, medium-sized companies and Initial Public Offerings (IPOs). The research marketplace would be funded by a levy on participating firms and would fund independent research on small, medium-sized companies and Initial Public Offerings (IPOs). Research offered through the research marketplace would be commissioned from independent research providers and financed by the levy and shared among contributing firms. Following a consultation with industry stakeholders, ESMA shall develop draft regulatory technical standards setting out the conditions for establishment of a voluntary EU-wide research marketplace on SME research, including at least the following elements: (a) the conditions for joining the research marketplace; (b) the governance principles; (c) the funding arrangements; (d) the research coverage of the research marketplace. ESMA shall submit those draft regulatory technical standards to the Commission by [18 months after the date of entry into force of this Directive]. Power is delegated to the Commission to adopt the regulatory technical standards referred to in the second subparagraph in accordance with Articles to 14 of Regulation (EU) No 1095/2010.” Amendment 50 # Johan VAN OVERTVELDT Proposal for a directive Article 1 – paragraph 1 – point 2 a (new) Directive 2014/65/EU Article 27 – paragraph 7 a (2 a) In Article 27, the following paragraph is inserted: : '7a. Member States shall require that a financial instrument of an issuer which is admitted to trading on an SME growth market may also be traded on another trading venue only if the issuer has been informed and has not objected .' Amendment 51 # Johan VAN OVERTVELDT Proposal for a directive Article 1 – paragraph 1 – point 3 – point c Directive 2014/65/EU Article 33 – paragraph 4 4. The criteria laid down in paragraphs 3 and 3a are without prejudice to compliance by the investment firm or market operator operating the MTF, or a segment thereof, with other obligations under this Directive relevant to the operation of MTFs. They also do not prevent the investment firm or market operator operating the MTF from imposing additional requirements to those specified in that paragraph. Amendment 52 # Danuta Maria HÜBNER, Isabel BENJUMEA BENJUMEA, Frances FITZGERALD Proposal for a directive Article 1 – paragraph 1 – point 3 – point c a (new) Directive 2014/65/EU Article 33 – paragraph 6 a (new) (c a) the following paragraph is inserted as follows: '6a. Member States shall require that a share of an issuer which is admitted to trading on an SME growth market may also be traded on another trading venue that imposes new obligations or responsibilities on the issuer only if the issuer has been notified and has not objected. Where admission to trading on another venue does not impose any new obligations or responsibilities, the notification as referred to in the first subparagraph shall not be required. For shares, the requirements as referred to in the first and second subparagraphs of this paragraph shall only apply until the consolidated tape for shares and ETFs, as referred to in Regulation (EU) 600/2014, is operational.’ Amendment 53 # Alfred SANT Proposal for a directive Article 1 – paragraph 1 – point 3 – point c b (new) Directive 2014/65/EU Article 33 – paragraph 7 (c b) paragraph 7 is replaced by the following: ‘7. Member States shall require that ~~where~~ a financial instrument of an issuer which is admitted to trading on ~~one~~an SME growth market~~, the financial instrument~~ may also be traded on another ~~SME growth market~~trading venue only ~~where~~if the issuer has been informed and has not objected. In such a case however, the issuer shall not be subject to any obligation relating to corporate governance or initial, ongoing or ad hoc disclosure with regard to the latter SME growth markegiven its consent.’ Amendment 54 # Jessica POLFJÄRD Proposal for a directive Article 1 – paragraph 1 – point 3 – point c b (new) Directive 2014/65/EU Article 33 – paragraph 7 (c b) paragraph 7 is replaced by the following: 7. Member States shall require that ~~where~~ a financial instrument of an issuer which is admitted to trading on ~~one~~an SME growth market~~, the financial instrument~~ may also be traded on another ~~SME growth market~~trading venue only ~~where~~if the issuer has been informed and has not objected. ~~In such a case however, the issuer shall not be subject to any obligation relating to corporate governance or initial, ongoing or ad hoc disclosure with regard to the latter SME growth market.~~ Amendment 55 # Inese VAIDERE, Isabel BENJUMEA BENJUMEA Proposal for a directive Article 1 – paragraph 1 – point 4 Directive 2014/65/EU Article 51a – paragraph 4 4. Member States shall ~~requi~~ensure that regulated markets ~~ensu~~require that at ~~any time at~~ least 10% of the subscribed capital represented by the class of shares concerned by the application for admission to trading is held by the public at the time of admission. Amendment 56 # Eva Maria POPTCHEVA, Stéphanie YON-COURTIN, Gilles BOYER Proposal for a directive Article 1 – paragraph 1 – point 4 Directive 2014/65/EU Article 51 a – paragraph 4 4. Member States shall require that regulated markets ensure that at ~~any time at~~ least 10% of the subscribed capital represented by the class of shares concerned by the application for admission to trading is held by the public at the time of the admission. Amendment 57 # Inese VAIDERE Proposal for a directive Article 1 – paragraph 1 – point 4 Directive 2014/65/EU Article 51a – paragraph 5 5. ~~Where the percentage of shares held by the public is below 10% of the subscribed capital, Member States shall ensure that regulated market~~By way of derogation from paragraph 4, Member States may require that regulated markets establish at least one of the following rules, as considered adequate by the relevant national competent authority, for application for admission to trading of shares at the time of admission: (a) a sufficient number of shares is held by the public; (b) the shares are~~quire that~~ held by a sufficient number of share~~s is distributed to the public to fulfil the requirement laid down in paragraph 4~~holders; (c) the market value of the shares held by the public represents a sufficient level of subscribed capital in the class of shares concerned. source: 751.683

Amendments

Dossier

2022/0405(COD)

2023/07/11 ECON 47 amendments...

Amendment 11 #

Jonás FERNÁNDEZ, Pedro MARQUES, Margarida MARQUES, Paul TANG, Eero HEINÄLUOMA, René REPASI

Proposal for a directive
Recital 2

~~(2) Directive 2014/65/EU and Commission D~~delegated Directive (EU) 2017/59330 set out the conditions under which the provision of investment research by third parties to investment firms providing portfolio management or other investment or ancillary services is not to be regarded as an inducement. In order to foster more investment research on companies in the Union, in particular small and medium capitalisation companies, and to bring those companies greater visibility and more prospect of attracting potential investors, it is necessary to introduce some amendments to that Directive. __________________ 30 Commission Delegated Directive (EU) 2017/593 of 7 April 2016 supplementing Directive 2014/65/EU of the European Parliament and of the Council with regard to safeguarding of financial instruments and funds belonging to clients, product governance obligations and the rules applicable to the provision or reception of fees, commissions or any monetary or non-monetary benefits (OJ L 87, 31.3.2017, p. 500).

Amendment 12 #

Jonás FERNÁNDEZ, Pedro MARQUES, Margarida MARQUES, Paul TANG, Eero HEINÄLUOMA, René REPASI

Proposal for a directive
Recital 3

(3) The provisions concerning research laid down in Directive 2014/65/EU require investment firms to separate payments which they receive as brokerage commissions from the compensation perceived for providing investment research (‘research unbundling rules’), or to pay for investment research from their own resources and assess the quality of the research they purchase based on robust quality criteria and the ability of such research to contribute to better investment decisions. In 2021, those rules have been amended by Directive (EU) 2021/338 of the European Parliament and of the Council31 to allow for bundled payments for execution services and research for small and medium capitalisation companies below a market capitalisation of EUR 1 billion. The decline of investment research has, however, not slowed down. __________________ 31 Directive (EU) 2021/338 of the European Parliament and of the Council of 16 February 2021 amending Directive 2014/65/EU as regards information requirements, product governance and position limits, and Directives 2013/36/EU and (EU) 2019/878 as regards their application to investment firms, to help the recovery from the COVID-19 crisis (OJ L 68, 26.2.2021, p. 14).deleted

Amendment 13 #

Eva Maria POPTCHEVA, Stéphanie YON-COURTIN, Gilles BOYER

Proposal for a directive
Recital 3

(3) The provisions concerning research laid down in Directive 2014/65/EU require investment firms to separate payments which they receive as brokerage commissions from the compensation perceived for providing investment research (‘research unbundling rules’), or to pay for investment research from their own resources and assess the quality of the research they purchase based on robust quality criteria and the ability of such research to contribute to better investment decisions. While the unbundling rules have created more transparency on the costs of research and allowed for a better management of conflicts of interest, they have had a negative impact on the EU’s investment research ecosystem and, particularly, on the research coverage of small and medium capitalization companies. In 2021, those rules have been amended by Directive (EU) 2021/338 of the European Parliament and of the Council31 to allow for bundled payments for execution services and research for small and medium capitalisation companies below a market capitalisation of EUR 1 billion. The decline of investment research has, however, not slowed down. __________________ 31 Directive (EU) 2021/338 of the European Parliament and of the Council of 16 February 2021 amending Directive 2014/65/EU as regards information requirements, product governance and position limits, and Directives 2013/36/EU and (EU) 2019/878 as regards their application to investment firms, to help the recovery from the COVID-19 crisis (OJ L 68, 26.2.2021, p. 14).

Amendment 14 #

Jonás FERNÁNDEZ, Pedro MARQUES, Margarida MARQUES, Paul TANG, Eero HEINÄLUOMA, René REPASI

Proposal for a directive
Recital 4

Amendment 15 #

Claude GRUFFAT

Proposal for a directive
Recital 4

(4) In order to revitalise the market for investment research and to ensure sufficient research coverage of companies, in particular the small and medium capitalisation companies, further alleviation of the research unbundling rules are necessary. By increasing from EUR 1 billion toSMEs continue to be characterised by lower amount of analyst research, higher probability of losing coverage, worse quality of research and limited secondary market liquidity, as compared to larger firms. According to ESMA findings, this situation appears to have been neither improved nor worsened by the MiFID II research unbundling provisions. For this reason, an expansion of the EUR 10 billion ~~the~~ threshold of companies’ market capitalisation below which the unbundling rules do not apply, more small and medium capitalisation companies, and in particular more medium capitalisation companies will benefit from a larger research coverage, bringing those companies more visibility from potential investors and thus increasing their capacity to raise funding in the marketis not likely to have a positive impact on research for small and medium capitalisation companies, while on the other hand it would reduce transparency and clarity for investors and weaken rules against conflict of interest. In order to revitalise the market for investment research and to ensure sufficient research coverage of companies, in particular the small and medium capitalisation companies, further measures are therefore necessary to promote ad strengthen the capacity to produce and distribute research through both public funding programmes and supervisory initiatives, while improving at the same time the rules to prevent conflict of interest associated with research sponsored by issuers.

Amendment 16 #

Eva Maria POPTCHEVA, Stéphanie YON-COURTIN, Gilles BOYER

Proposal for a directive
Recital 4

(4) In order to revitalise the market for investment research and to ensure sufficient research coverage of companies, in particular the small and medium capitalisation companies, ~~further alleviation of the research unbundling rules are necessary. By increasing from EUR 1~~ unbundling rules should be further adjusted. Investment firms should have more flexibillionty to EUR 10 billion the threshold of companies’ market capitalisation below which the unbundling rules do not apply, more small and medium capitalisation companies, and in particular more medium capitalisation companies will benefit from a larger research coverage, bringing those companies mochoose the way in which they wish to organise the payments of execution services and research. This would however require to maintain a level of transparency vis-a-vis the client as to the payment choice made by the investment firms. Investment firms should inform their clients whether they apply a separate or joint payment for the execution services and the provision of third party research. Appropriate information to the clients should be ensured vi~~sibility from potential investors and thus increasing their capacity to raise funding in the marke~~a the recording by the firm of the charges attributable to research and execution services and also via the provision of an annual report on those payments to the clients.

Amendment 17 #

Eva Maria POPTCHEVA, Stéphanie YON-COURTIN, Gilles BOYER

Proposal for a directive
Recital 4 a (new)

(4 a) The adjustment of unbundling rules alone will not suffice to revitalize the market of research investment and address the longstanding shortage of research coverage of small and medium capitalization companies. The measures introduced in this directive should not undermine the progress made in terms of price transparency, reduction of conflicts of interest and other regulatory objectives of MiFID II. Further measures should be introduced to improve the coverage of SMEs and the promotion of independent research in the market.

Amendment 18 #

Claude GRUFFAT

Proposal for a directive
Recital 5

(5) In addition, to further support the coverage of small and medium capitalisation companies by investment research, research material paid fully or partially by issuers should be labelled as ‘issuer-sponsored research’. To ensure an adequate level of objectivity and independence of such research material, such material should be produced in line with a code of conduct developed ~~or endorsed by a market operator registered in a Member State or by a competent authority. In order to support more~~by ESMA by means of regulatory technical standards. For this purpose, investment firms should have in place governance and organisational procedures to ensure that the issuer-sponsored research they produce, use or distribute is produced in compliance with the EU code of conduct and with the requirements laid down in this Directive. Member States should ensure that competent authorities have all the necessary supervisory and investigatory powers to ensure that the investment firms comply with the requirements. In order to ensure the necessary visibility of the issuer-sponsored research, issuers should ~~have the possibility to~~ submit their issuer- sponsored research to the relevant collection body as defined32 in [Article 2 (2) of the proposal for a Regulation33 on a European Single Access Point]. __________________ 32 See Article2.2 o proposal for a Regulation [2021.78.COD] 33 Proposal for a Regulation [2021/03.78.COD]

Amendment 19 #

Johan VAN OVERTVELDT

Proposal for a directive
Recital 5

(5) In addition, to further support the coverage of small and medium capitalisation companies by investment research, research material paid fully or partially by issuers should be labelled as ‘issuer-sponsored research’. To ensure an adequate level of objectivity and independence of such research material, such material should be produced in line with a code of conduct ~~developed or endorsed by a market operator registered in a Member State or by a competent authority~~published by ESMA. In order to support more visibility of the issuer-sponsored research, issuers should have the possibility to submit their issuer-sponsored research to the relevant collection body as defined32 in ~~[Article 2 (2)~~Regulation (EU) .../... of the pEurop~~osal for a Regulation33 on~~ean Parliament and the Council33a. __________________ 33a Regulation (EU) .../... of the European Parliament and the Council establishing a European Ssingle Aaccess Ppoint~~]. __________________ 32 See Article2.2 o proposal for a Regulation [2021.78.COD] 33 Proposal for a Regulation [~~ providing centralised access to publicly available information of relevance to financial services, capital markets and sustainability (2021/03.78.(COD] )).

Amendment 20 #

Markus FERBER, Inese VAIDERE, Isabel BENJUMEA BENJUMEA

Proposal for a directive
Recital 5

(5) In addition, to further support the coverage of small and medium capitalisation companies by investment research, research material paid fully or partially by issuers should be labelled as ‘issuer-sponsored research’. To ensure an adequate level of objectivity and independence of such research material, such material should be produced in line with a code of conduct developed or endorsed by a market operator registered in a Member State or by a competent authority. In order to support more visibility of the issuer-sponsored research, issuers should have the possibility to submit their issuer-sponsored research to the relevant collection body as defined32 in [Article 2 (2) of the proposal for a Regulation33 on a European Single Access Point]. ESMA should develop minimum standards for the code of conduct in order to establish a minimum level of convergence across jurisdictions. __________________ 32 See Article2.2 o proposal for a Regulation [2021.78.COD] 33 Proposal for a Regulation [2021/03.78.COD]

Amendment 21 #

Danuta Maria HÜBNER, Isabel BENJUMEA BENJUMEA, Frances FITZGERALD

Proposal for a directive
Recital 6 a (new)

(6 a) Shares in SMEs are often illiquid as they have a smaller market capitalisation, a narrower investor base, and a lower trading volume. Issuers should therefore be given the opportunity to maximise their access to capital by having their instruments available for trading for the greatest number of investors, whilst needing to be protected if being traded on another trading venue would subject them to additional disclosures obligations or responsibilities. Member States should therefore be able to require that, until the consolidated tape for shares and ETFs is established, a share of an issuer which is admitted to trading on an SME growth market may also be traded on another trading venue that imposes new obligations or responsibilities on the issuer only if the issuer has been notified and has not objected. Where admission to trading on another venue does not impose any new obligations or responsibilities, no such notification will be required.

Amendment 22 #

Jessica POLFJÄRD

Proposal for a directive
Recital 6 a (new)

(6 a) Member States should require that a financial instrument of an issuer which is admitted to trading on an SME growth market may also be traded on another trading venue only if the issuer has been informed and has not objected. Shares in SMEs are often illiquid by nature as they have a smaller market capitalisation and a lower trading volume. Issuers should therefore be able to object to being traded on another trading venue, as this could be beneficial in terms of reducing the risks of fragmentation of liquidity.

Amendment 23 #

Christophe HANSEN

Proposal for a directive
Recital 7

(7) Directive 2001/34/EC of the European Parliament and of the Council34 lays down rules concerning listing on Union markets. That Directive aims at coordinating the rules on the admission of securities to official stock exchange listing and on information to be published on those securities to provide equivalent protection for investors at Union level. That Directive also lays down the rules of the regulatory and supervisory framework for Union primary markets. In the course of the years, Directive 2001/34/EC has been amended significantly several times. Directives 2003/71/EC of the European Parliament and of the Council35 and Directive 2004/109/EC of the European Parliament and of the Council36 have replaced most of the provisions harmonising the conditions for the provision of information regarding requests for the admission of securities to official stock exchange listing and the information on securities admitted to trading, and have made large parts of Directive 2001/34/EC redundant. Directive 2001/34/EC as a minimum harmonisation Directive gives Member States a rather broad discretion to deviate from the rules laid down in that Directive, which has led to market fragmentation in the Union. To drive market harmonisation at Union level and create a single rule book, Directive 2001/34/EC shouldshould therefore be repealed. __________________ 34 Directive 2001/34/EC of the European Parliament and of the Council of 28 May 2001 on the admission of securities to official stock exchange listing and on information to be published on those securities (OJ L 184, 6.7.2001, p. 1). 35 Directive 2003/71/EC of the European Parliament and of the Council of 4 November 2003 on the prospectus to be published when securities are offered to the public or admitted to trading and amending Directive 2001/34/EC (OJ L 345, 31.12.2003, p. 64). 36 Directive 2004/109/EC of the European Parliament and of the Council of 15 December 2004 on the harmonisation of transparency requirements in relation to information about issuers whose securities are admitted to trading on a regulated market and amending Directive 2001/34/EC (OJ L 390, 31.12.2004, p. 38).

Amendment 24 #

Inese VAIDERE, Isabel BENJUMEA BENJUMEA

Proposal for a directive
Recital 9

(9) To allow for more flexibility for issuers and to make Union capital markets more competitive, the minimum free float requirement should be decreased to 10%, which is a threshold that ensures for a sufficient level of liquidity in the market. In some cases, Member States should be able to allow a lower free float rate to be applied as long as alternative requirements are met to ensure a well- functioning capital market. The free float requirement laid down in Directive 2001/34/EC that a sufficient number of shares is to be distributed to the public in one or more Member States refers to the public within the Union and the European Economic Area (EU/EEA). That geographical restriction of the free float requirement to the EU/EEA should not be maintained as Directive 2014/65/EU does not provide for such restriction for financial instruments admitted to trading. The requirement that a company is to have published or filed its annual accounts for a specific period of time should not be transferred to Directive 2014/65/EU since Regulation (EU) 2017/1129 of the European Parliament and of the Council37 already contains a provision to that effect. Directive 2014/65/EU already lays down provisions to designate competent authorities. Thus, the provisions laid down in Directive 2001/34/EC to appoint one or more competent authorities are redundant. The requirement for debt securities that the amount of the loan is not be less than EUR 200 000 are considered obsolete in light of current market practice. __________________ 37 Regulation (EU) 2017/1129 of the European Parliament and of the Council of 14 June 2017 on the prospectus to be published when securities are offered to the public or admitted to trading on a regulated market, and repealing Directive 2003/71/EC (OJ L 168, 30.6.2017, p. 12).

Amendment 25 #

Christophe HANSEN

Proposal for a directive
Recital 10

(10) The concept of admission of securities to official listing on stock exchanges provided for in Directive 2001/34/EC is no longer frequently used given market developments, as Directive 2014/65/EU already provides for the concept of ‘admission of financial instruments to trading on a regulated market’. TWhile in some Member States the two concepts ‘admission to official listing’ and ‘admission to trading on a regulated market’ are ~~often~~ used interchangeably, in ~~some~~other Member States~~. That means that, in some Member States, no distinction is made between the~~ the concept of ‘admission to official listing’ continues two ~~concepts. Furthermore, the dual regime~~play an important role alongside the concept of ‘admission to trading, on the one hand, and admission to official listing, on the other hand, could lead to legal uncertainty at Union level, in particular, due to the fact that the requirements laid down in Directive 2003/71/EC, Directive 2004/109/EC and Directive 2014/57/EU of the European Parliament and of the Council38 do not apply to instruments admitted to official listing, while those requirements apply to instruments admitted to trading on a regulated marketa regulated market’, in particular by providing an alternative to issuers of securities, notably debt securities, who seek increased visibility but for whom admission to trading is not a relevant or viable option. The repeal of Directive 2001/34/EC by this Directive should be without prejudice to the validity and continuation of the regimes of ‘admission of securities to official listing’ on stock exchanges in Member States, as well as to Member States’ ability to provide for and regulate such regimes under national law. __________________ 38 Directive 2014/57/EU of the European Parliament and of the Council of 16 April 2014 on criminal sanctions for market abuse (market abuse directive) (OJ L 173, 12.6.2014, p. 179).

Amendment 26 #

Eva Maria POPTCHEVA, Stéphanie YON-COURTIN, Gilles BOYER

Proposal for a directive
Recital 11

(11) To enhance the visibility of listed companies, in particular SMEs and to adapt the listing conditions to improve requirements for issuers, the power to adopt acts in accordance with Article 290 of the Treaty on the Functioning of the European Union should be delegated to the Commission in respect of amending Directive 2014/65/EU. The market capitalisation threshold for companies, for which the re-bundling of trading execution and research fees would be possible~~, to capture small and medium capitalisation companies, and providing a framework for the development of a particular form of research for which the issuer pays should be adapted~~ should be removed while introducing safeguards to maintain a level of transparency regarding the costs associated to research. The adaption of the listing rules in the Union should also reflect market practice for it to be effective and promote competition. It is of particular importance that the Commission carry out appropriate consultations during its preparatory work, including at expert level, and that those consultations be conducted in accordance with the principles laid down in the Interinstitutional Agreement of 13 April 2016 on Better Law-Making39 . In particular, to ensure equal participation in the preparation of delegated acts, the European Parliament and the Council receive all documents at the same time as Member States' experts, and their experts systematically have access to meetings of Commission expert groups dealing with the preparation of delegated acts. __________________ 39 OJ L 123, 12.5.2016, p. 1.

Amendment 27 #

Eva Maria POPTCHEVA, Stéphanie YON-COURTIN, Gilles BOYER