EU Finance & Regulatory Services

Regulation and supervision

The EU has introduced a specific regulatory process for financial services. The EU’s supervisory architecture consists of 3 European supervisory authorities and a board to monitor systemic risks. 

The European system of financial supervision (ESFS) was introduced in 2010. It consists of

• The European Systemic Risk Board (ESRB)
• 3 European supervisory authorities (ESAs), namely
  • the European Banking Authority (EBA)
  • the European Securities and Markets Authority (ESMA)
  • the European Insurance and Occupational Pensions Authority (EIOPA)

Regulatory process in financial services

A specific regulatory process for financial services was introduced with the Lamfalussy report and then upgraded after the financial crisis.This report recommended the adoption of a new approach to improve the regulatory process in financial services in order to make it quicker and more effective.

The Lamfalussy regulatory approach involved four institutional levels:

• At level 1 the European Parliament and Council adopt the basic laws proposed by the Commission, in the traditional co-decision procedure. As this procedure is usually complex and time-consuming, the Lamfalussy report recommends using it only for setting out framework principles.
• At level 2 the Commission can adopt, adapt and update technical implementing measures with the help of consultative bodies composed mainly of EU countries representatives. This allows the Council and Parliament to focus on the key political decisions, while technical implementing details can be worked out afterwards by the Commission.

Capital Movement

Find information on the right to the free movement of capital in the EU, including its legal basis, monitoring, and investment outside of the EU.

Article 63 of the Treaty on the Functioning of the European Unionrequires that all restrictions on the movement of capital between EU countries and between EU countries and non-EU countries be prohibited unless they are necessary to pursue legitimate public interests.

The purpose of free movement of capital is to enable an efficient cross-border deployment of physical and financial capital for investment and financing purposes.

For individuals, this means being able to carry out many transactions, including

• opening bank accounts abroad
• buying shares in non-domestic companies
• investing where the best return is
• purchasing real estate in another country

Sustainable finance

The EU is examining how to make sustainability considerations an integral part of its financial policy in order to support the European green deal. In the EU's policy context, sustainable finance is understood as finance to support economic growth while reducing pressures on the environment to help reach the climate- and environmental objectives of the European Green Deal, taking into account social and governance aspects. Sustainable finance also encompasses transparency when it comes to risks related to ESG factors that may have an impact on the financial system, and the mitigation of such risks through the appropriate governance of financial and corporate actors.

Consumer finance and payments

Financial services have a major impact on consumers' lives. Consumers should be able to make well-informed decisions on financial matters and feel confident that they are well protected if something goes wrong. The Commission is working to ensure a safer and more integrated market for retail financial services in the EU.

Consumer financial services, also called retail financial services, are financial services offered to ordinary consumers. They cover a wide array of products such as:

• current and savings accounts
• payment services
• credit cards
• mortgages
• insurance
• investment products

Digital finance

New financial technologies can facilitate access to financial services and improve the efficiency of the financial system. While technological innovation in finance is not new, investment in new technologies has substantially increased in recent years and the pace of innovation is exponential. We now interact with our bank using mobile technology. We make payments, transfer money and make investments using a variety of new tools that were not there few years ago. Artificial intelligence, social networks, machine learning, mobile applications, distributed ledger technology, cloud computing and big data analytics have given rise to new services and business models by established financial institutions and new market entrants. All these technologies can benefit both consumers and companies by enabling greater access to financial services, offering wider choice and increasing efficiency of operations. The financial services industry has been influenced by innovative technology, which can benefit both consumers and companies by giving a greater access to financial services