On 4 December, the European Commission published the Market Integration & Supervision Package (the ‘MIP package’). The package fits within the broader Savings and Investments Union agenda and underlines the ambition to mobilise capital more efficiently within the EU. With this package, the Commission takes an important step towards further integration of European capital markets, with the aim of facilitating cross-border capital flows and reducing market fragmentation. For our sector, the MIP package contains several relevant elements. It offers opportunities to contribute to a better-functioning internal market, where cross-border activities are simplified and European asset managers can further strengthen their role in financing the economy. Last summer, DUFAS responded to the consultation.
European passport regime
Although the EU passport regime has existed for many years, cross-border asset managers still face differing national requirements and supervisory practices. With its proposals, the Commission aims to largely remove these differences. By harmonising authorisation procedures for UCITS and AIFMs, limiting gold-plating, and facilitating cross-border marketing, the framework for cross-border asset managers will be clarified, creating a more level playing field within the EU.
Group structures
Another important element of the MIP package concerns the treatment of group structures for UCITS managers and AIFMs. By no longer automatically treating intra-group cooperation as delegation, the legislative framework better reflects how international asset managers are organised, enabling more efficient use of resources and expertise within groups. This will make it easier to outsource activities within a group.
Depositary passport
The proposal to introduce an EU depositary passport aims to increase choice and competition in the European depositary market. For funds and managers, this could lead to a broader range of services and greater flexibility in the structuring of funds. The further development of this proposal offers an opportunity to better align market dynamics with supervisory objectives.
Supervisory convergence
In addition to market integration, the package focuses on further harmonisation of supervisory practices and a more central role for ESMA across various aspects of supervision. A common supervisory framework is seen as an important precondition for further market integration. For asset managers, this will primarily affect large internationally operating firms.
Settlement finality
The conversion of the Settlement Finality Directive into a directly applicable Settlement Finality Regulation strengthens the legal foundation of the European market infrastructure. By removing differences in national treatment and explicitly taking into account technological developments such as DLT and tokenisation, the basis for an innovative capital market is further reinforced. This represents an important step for the future resilience of European capital markets.
The MIP package demonstrates that the European Commission is serious about further integrating European capital markets. The upcoming legislative phase will be decisive for the final shape of the package, but the strategic direction is clear. The proposal is now before the Council and the European Parliament. In the Council, an initial introductory working party has taken place, and the Cypriot Presidency will take forward the substantive discussions from 2026. In the European Parliament, a rapporteur will be appointed in the coming period.
In the coming weeks, DUFAS will analyse the package in detail together with the relevant expert groups.
This column was written by Daan Zebel, Manager Regulatory Affairs at DUFAS.
