In December 2025, the European Commission published a set of legislative proposals known as the Market Integration and Supervision Package, or MISP. The package aims to support more integrated, efficient and competitive financial markets across the European Union.
MISP forms part of the Savings and Investments Union strategy, which seeks to channel savings towards productive investment and expand funding opportunities for European businesses.
Although the EU has developed a common framework for financial services, its capital markets remain fragmented along national lines. Differences in laws, supervisory practices and market infrastructure can make it more complex and costly to operate across Member States. They can also prevent businesses and investors from benefiting fully from the scale of the Single Market.
The package seeks to address these challenges by supporting market integration, simplifying certain regulatory requirements, modernising financial-market infrastructure and reviewing aspects of the European supervisory framework.
A Wide-Ranging Package
MISP covers several interconnected areas of the European financial system, including trading, clearing, securities settlement, asset management and crypto-asset services. Its legislative proposals would amend a wide range of existing EU financial-services rules.
In the area of trading, the Commission is proposing measures to make it easier for trading venues to operate across Member States. This includes a proposed Pan-European Market Operator framework, which could allow qualifying operators to manage several trading venues through a more integrated regulatory structure.
The package also seeks to improve the functioning of equity markets and support more efficient trading. In clearing and settlement, the proposals aim to reduce obstacles affecting cross-border services and improve connections between market infrastructures.
Another proposal concerns settlement finality, which provides legal certainty that completed payment and securities transactions remain valid, including if a participant in the relevant system becomes insolvent. The Commission is proposing more consistent application of these protections across the EU.
Supporting Innovation and Digital Finance
Technological development is another important part of the package. The Commission is proposing changes to the EU framework for market infrastructures that use distributed ledger technology, commonly known as the DLT Pilot Regime.
The regime provides a controlled environment in which market participants can test the trading and settlement of tokenised financial instruments. The proposed changes are intended to make the framework more practical and commercially viable while maintaining appropriate safeguards for investors, market integrity and financial stability.
The package also considers how crypto-asset services interact with the rules governing investment services and traditional market infrastructures.
These proposals reflect the growing links between traditional capital markets and digital finance. They also underline the need for innovation to be supported by clear governance, effective risk management and proportionate investor protection.
The Future of European Supervision
MISP also concerns the role and governance of the European Securities and Markets Authority, or ESMA. The Commission is proposing that ESMA take on direct supervisory responsibilities in selected areas, together with changes to its governance and decision-making arrangements.
The proposals raise important questions about how responsibilities should be shared between ESMA and national authorities. Any future framework will need to promote consistent supervision across the EU while continuing to benefit from national expertise and knowledge of local markets.
It will also need to recognise that trading venues, central securities depositories and central counterparties perform different functions and may require different supervisory approaches.
A Coordinated MFSA Contribution
Given the package’s broad scope covering different aspects of traditional finance to the more innovative models of digital finance, required input from several areas of expertise. Various functions within the MFSA have therefore been analysing the proposals and their potential implications for Malta’s financial-services sector and the wider European market.
This cross-functional approach reflects the interconnected nature of the package. Mindful that changes in one area could have wider implications for market structure, innovation, investor protection, operational resilience and competitiveness, MFSA is following this package very closely.
Looking Ahead
MISP is an ambitious attempt to address long-standing barriers within European capital markets. Its success will depend on whether it can promote greater integration, efficiency and innovation while maintaining proportionate rules, legal certainty and effective supervision.
Through its continued technical and policy engagement, the MFSA is contributing to the assessment of how the European framework can support deeper and more competitive capital markets while maintaining high standards of market integrity, investor protection and financial stability.
Suggested Standfirst
The European Commission’s Market Integration and Supervision Package seeks to reduce fragmentation, modernise market infrastructure and review aspects of financial supervision across the EU. Several MFSA functions are working together to assess the proposals and their implications for Malta and the wider European market.
