Crypto-assets, Capital Markets, AML and Climate on the European Commission’s Agenda
FEBRUARY 26, 2020
Deputy Counsel Ryan Borg from MFSA's EU and International Affairs takes a closer look at the policy objectives set out in the European Commission's 2020 work programme, which are specifically related to financial services.

The MFSA participating in consultation process to  implement EU objectives

The MFSA is currently taking part in an ongoing EU-level public consultation process launched by the European Commission on creating a Union-wide crypto-assets framework.

The measure is one of several included in the Commission’s Work Programme for 2020 – launched in January – which sets out the actions the Commission will take to turn the political guidelines of its new president, Ursula von der Leyen, into tangible benefits for EU citizens, businesses and societies. For the first time, the Commission is attempting to directly set the stage for legislation on crypto-assets and to address cyber security concerns in the financial services sector, with a view towards ensuring the safety of both the industry and the EU in general.

The MFSA’s participation in the consultation process is based on the experience it gained through the implementation of the Virtual Financial Assets Framework.

Capital markets, anti-money laundering and climate also on the agenda

Other financial services objectives on the agenda of the Commission’s 2020 programme centre around integrating capital markets further, enhancing anti-money laundering actions and incorporating climate initiatives into law.

The Commission is very keen on strengthening the Capital Markets Union (CMU), with a plan to launch a CMU action plan in the second quarter of 2020, together with a MiFID II, MiFIR and Benchmark Regulation review. The Commission  will also be reviewing the Capital Requirement’s legislation, with Malta’s regulator being one of the participants in the Commission’s Expert Group meetings which will lead to the drawing-up of a legislative proposal for “finalised Basel III standards” which will be binding on European banks. Within this context, the MFSA is formulating a Capital Markets Strategy, which should be published later this year.

The Commission has announced a new anti-money laundering action plan to enhance the EU’s supervisory system and improve rules enforcement by the first half of this year. The MFSA remains committed to ensuring the financial system’s integrity and reducing instability risks.

Von der Leyen has moreover placed climate at the top of the Commission’s agenda, with the EU aiming to incorporate climate measures into all its legislative areas and to enshrine its target of becoming climate-neutral by 2050 into Union law. The Authority has taken cognizance of the fact that sustainability poses a direct and indirect risk to the financial industry, and is looking into devising a cross-sectoral viewpoint to integrate sustainability into its supervision and reporting guidelines to a higher degree.

The Commission’s Work Programme is ambitious, and, within this context, the MFSA is actively engaged in policy dialogue, negotiations and follow-ups of EU institutional affairs and dossiers to contribute to the programme and reach its objectives.