EU to make public capital markets in the Union more attractive for companies and to facilitate access to capital for SME's - Main contents

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dossier	COM(2022)760 - Amendment of Directive 2014/65/EU to make public capital markets in the Union more attractive for companies and to ...
document	COM(2022)760
date	October 23, 2024

Article 1

Amendments to Directive 2014/65/EU

Directive 2014/65/EU is amended as follows:

(1)

in Article 4(1), point (12) is replaced by the following:

‘(12)

“SME growth market” means an MTF, or a segment of an MTF, that is registered as an SME growth market in accordance with Article 33;’

;

(2)

Article 24 is amended as follows:

(a)

the following paragraphs are inserted:

‘3a.   Research produced by investment firms or by third parties and used by, or distributed to, investment firms, their clients or potential clients, shall be fair, clear and not misleading. Research shall be clearly identifiable as such or in similar terms, provided that all conditions laid down in Commission Delegated Regulation (EU) 2017/565 (*1) applicable to the research are met.

3b.   Investment firms providing portfolio management or other investment services or ancillary services shall ensure that the research they distribute to clients or potential clients which is paid for, in full or in part, by an issuer shall be labelled as “issuer-sponsored research” only if it is produced in compliance with the EU code of conduct for issuer-sponsored research referred to in paragraph 3c.

3c.   ESMA shall develop draft regulatory technical standards to establish an EU code of conduct for issuer-sponsored research. That code of conduct shall set out standards of independence and objectivity, and specify procedures and measures for the effective identification, prevention and disclosure of conflicts of interest.

In developing the regulatory technical standards on the EU code of conduct for issuer-sponsored research, ESMA shall take into account the content and parameters of codes of conduct for issuer-sponsored research which have been established at national level prior to the date of application of the regulatory technical standards, especially where such codes have been widely endorsed and adhered to. ESMA shall also, where applicable, take into account the relevant obligations and standards on investment recommendations set out in Article 20 of Regulation (EU) No 596/2014.

ESMA shall submit those draft regulatory technical standards to the Commission by 5 December 2025.

Power is delegated to the Commission to supplement this Directive by adopting the regulatory technical standards referred to in the first subparagraph of this paragraph in accordance with Articles 10 to 14 of Regulation (EU) No 1095/2010.

The EU code of conduct for issuer-sponsored research shall be made publicly available on ESMA’s website.

ESMA shall assess at least every five years following the adoption of the regulatory technical standards referred to in the first subparagraph of this paragraph, whether the EU code of conduct for issuer-sponsored research needs to be amended, in which case it shall submit draft regulatory technical standards to the Commission.

Member States shall provide that investment firms that produce or distribute issuer-sponsored research have in place organisational arrangements to ensure that such research is produced in compliance with the EU code of conduct for issuer-sponsored research and complies with paragraphs 3a, 3b and 3e.

3d.   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, point (2), of Regulation (EU) 2023/2859 of the European Parliament and of the Council (*2).

When submitting that research to the collection body, the issuer shall ensure that it is accompanied by metadata specifying that the information complies with the EU code of conduct for issuer-sponsored research. Such research shall not be considered to be regulated information within the meaning of Directive 2004/109/EC nor investment research within the meaning of this Directive and shall therefore not be subject to the same level of regulatory scrutiny as regulated information or investment research.

3e.   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 the EU code of conduct for issuer-sponsored research. Any other research material paid, in full or in part by the issuer but not prepared in compliance with that EU code of conduct for issuer-sponsored research shall be labelled as a marketing communication.

(*1)  Commission Delegated Regulation (EU) 2017/565 of 25 April 2016 supplementing Directive 2014/65/EU of the European Parliament and of the Council as regards organisational requirements and operating conditions for investment firms and defined terms for the purposes of that Directive (OJ L 87, 31.3.2017, p. 1)."

(*2)  Regulation (EU) 2023/2859 of the European Parliament and of the Council of 13 December 2023 establishing a European single access point providing centralised access to publicly available information of relevance to financial services, capital markets and sustainability (OJ L, 2023/2859, 20.12.2023, ELI: http://data.europa.eu/eli/reg/2023/2859/oj).’;"

(b)

paragraph 9a is amended as follows:

(i)

the first subparagraph is replaced by the following:

‘The provision of research by third parties to an investment firm providing portfolio management or other investment or ancillary services to clients shall be regarded as fulfilling the obligations under paragraph 1 if:

(a)

an agreement has been entered into between the investment firm and the third-party provider of execution services and research establishing a methodology for remuneration, including how the total cost of research is generally taken into account when establishing the total charges for investment services;

(b)

the investment firm informs its clients of its choice to pay either jointly or separately for execution services and research and makes available to them its policy on payments for execution services and research, including the type of information that can be provided depending on the firm’s choice of payment method and, where relevant, how the investment firm prevents or manages conflicts of interest pursuant to Article 23 when applying a joint payment method for execution services and research;

(c)	the investment firm assesses on an annual basis the quality, usability and value of the research used, as well as the ability of the research used to contribute to better investment decisions; ESMA may develop guidelines for investment firms for the purpose of conducting those assessments;

(d)

where the investment firm chooses to pay separately for execution services and third-party research, the provision of research by third parties to the investment firm is received in return for either of the following:

(i)	direct payments by the investment firm out of its own resources;

(ii)	payments from a separate research payment account controlled by the investment firm.’

;

(ii)

the following subparagraphs are added:

‘For the purpose of this Article, trading commentary and other bespoke trade advisory services intrinsically linked to the execution of a transaction in financial instruments shall not be considered to be research.

Where an investment firm receives research from a research provider who 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, the provision of such research to the investment firm is regarded as fulfilling the obligations under paragraph 1. In such cases, the investment firm shall comply with the requirement under the first subparagraph, point (c), of this paragraph.

Where known to them, investment firms shall keep a record of the total costs attributable to third-party research provided to them. Upon request, such information shall be made available on an annual basis to the investment firm’s clients.

By 5 December 2028, ESMA shall prepare a report with a comprehensive assessment of market developments regarding research within the meaning of this Article. That assessment shall incorporate at least the research coverage of listed firms, the evolution of the costs and quality of that research, the impact of joint payments on execution quality, the share of separate and joint payments made by investment firms to third party providers for execution services and research, and the level of fulfilment of the demand for research by investors and other buyers.

Based on that report, the Commission may, if appropriate, submit to the European Parliament and to the Council a legislative proposal concerning changes to the rules laid down in this Directive regarding research.’

;

(3)

Article 33 is amended as follows:

(a)

paragraphs 1 and 2 are replaced by the following:

‘1. Member States shall provide that the operator of an MTF may apply to its home competent authority to have the MTF, or a segment thereof, registered as an SME growth market.

2. Member States shall provide that the home competent authority may register the MTF, or a segment thereof, as an SME growth market if the competent authority receives an application as referred to in paragraph 1 and is satisfied that the conditions set out in paragraph 3 are complied with in relation to the MTF, or that the conditions in paragraph 3a are complied with in relation to a segment of the MTF.’

;

(b)

the following paragraph is inserted:

‘3a. Member States shall ensure that the relevant segment of the MTF is subject to effective rules, systems and procedures which ensure that the conditions set out in paragraph 3 and all of the following conditions have been complied with:

(a)

the segment of the MTF registered as “SME growth market” is clearly separated from the other market segments operated by the investment firm or market operator operating the MTF, which is, inter alia, indicated by a different name, different rulebook, different marketing strategy, and different publicity, as well as a specific allocation of the market identification code to the segment registered as SME growth market segment;

(b)	the transactions made on the SME growth market segment concerned are clearly distinguished from other market activity within the other segments of the MTF;

(c)

upon the request of the competent authority of the home Member State of the MTF, the MTF shall provide a comprehensive list of the instruments listed on the SME growth market segment concerned, as well as any information on the operation of the SME growth market segment that the competent authority may request.’

;

(c)

paragraphs 4 to 8 are replaced by the following:

‘4. Compliance by the investment firm or market operator operating the MTF, or a segment thereof, with the conditions laid down in paragraphs 3 and 3a is without prejudice to compliance by that investment firm or market operator with other obligations under this Directive relevant to the operation of MTFs. Without prejudice to paragraph 7, the investment firm or market operator operating the MTF, or a segment thereof, may impose additional conditions.

5. Member States shall provide that the competent authority of the home Member State of an MTF may deregister an MTF, or a segment thereof, as an SME growth market in any of the following cases:

(a)	the investment firm or market operator operating the MTF, or a segment thereof, applies for its deregistration;

(b)	the conditions in paragraph 3 or 3a are no longer complied with in relation to the MTF, or a segment thereof.

6. Members States shall require that if a competent authority of the home Member State of an MTF registers or deregisters an MTF, or a segment thereof, as an SME growth market under this Article, that authority shall as soon as possible notify ESMA of that registration or deregistration. ESMA shall publish on its website a list of SME growth markets and shall keep that list up to date.

7. Member States shall require that where a financial instrument of an issuer is admitted to trading on one SME growth market, that financial instrument may also be traded on another trading venue only where the issuer has been informed and has not objected. Where the other trading venue is another SME growth market or a segment of an SME growth market, the issuer shall not be subject to any obligation relating to corporate governance, or initial, ongoing or ad hoc disclosure, with regard to that other SME growth market. Where the other trading venue is not an SME growth market, the issuer shall be informed of any obligation to which the issuer will be subject that relates to corporate governance, or initial, ongoing or ad hoc disclosure, with regard to the other trading venue. ESMA shall develop guidelines by 5 June 2026 with respect to the procedures for informing issuers and to the process for lodging objections, as well as the relevant timelines.

8. The Commission is empowered to adopt delegated acts in accordance with Article 89 to supplement this Directive by further specifying the conditions laid down in paragraphs 3 and 3a of this Article. Those conditions shall take into account the need to maintain high levels of investor protection in order to promote investor confidence in those markets, while minimising the administrative burdens for issuers on the market. They shall also take into account that deregistrations are not to occur nor are registrations to be refused merely because of a temporary failure to comply with the condition laid down in paragraph 3, point (a), of this Article.’

;

(4)

the following article is inserted:

‘Article 51a

Specific conditions for the admission of shares to trading

1. Member States shall ensure that regulated markets require that the foreseeable market capitalisation of the company for whose shares admission to trading is sought, or if that cannot be assessed, that company’s capital and reserves, including profit and loss, from the last financial year, shall be at least EUR 1 000 000 or an equivalent amount in a national currency other than the euro.

2. Paragraph 1 shall not apply to the admission to trading of shares fungible with shares already admitted to trading.

3. Where, as a result of an adjustment of the equivalent amount in a national currency other than the euro, the market capitalisation expressed in the national currency remains for a period of one year at least 10 % more, or at least 10 % less, than EUR 1 000 000, the Member State shall, within the 12 months following the expiry of that period, adjust its laws, regulations or administrative provisions to comply with paragraph 1.

4. Member States shall ensure that regulated markets require that 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 to trading.

5. By way of derogation from paragraph 4, Member States may require that regulated markets establish, at the time of admission, at least one of the following requirements for an application for admission to trading of shares:

(a)	a sufficient number of shares is held by the public;

(b)	the shares are held by a sufficient number of shareholders;

(c)	the market value of the shares held by the public represents a sufficient level of subscribed capital in the class of shares concerned.

6. Where admission to trading is sought for shares fungible with shares already admitted to trading, regulated markets shall assess, to fulfil the requirement laid down in paragraph 4, whether a sufficient number of shares has been distributed to the public in relation to all shares issued and not only in relation to the shares fungible with shares already admitted to trading.

7. The Commission is empowered to adopt delegated acts in accordance with Article 89 to amend this Directive by modifying the thresholds referred to in paragraphs 1 and 3 of this Article or the threshold referred to in paragraph 4 of this Article, or all of them, when the applicable thresholds impede liquidity on public markets taking into account financial developments.’

;

(5)

in Article 69(2), first subparagraph, the following points are added:

‘(v)	take all necessary measures to verify that investment firms have in place organisational arrangements to ensure that the issuer-sponsored research that they produce or distribute complies with the EU code of conduct for issuer-sponsored research;

(w)	suspend the distribution by investment firms of any issuer-sponsored research not produced in compliance with the EU code of conduct for issuer-sponsored research;

(x)

where a research labelled as “issuer-sponsored research” and distributed by an investment firm, is not produced in compliance with the EU code of conduct for issuer-sponsored research, issue warnings to inform the public that that research is not produced in compliance with the EU code of conduct for issuer-sponsored research.’

;

(6)

Article 89 is amended as follows:

(a)

paragraphs 2 and 3 are replaced by the following:

‘2. The delegation of power referred to in Article 2(3) and (4), Article 4(1), point (2), second subparagraph, Article 4(2), Article 13(1), Article 16(12), Article 23(4), Article 24(13), Article 25(8), Article 27(9), Article 28(3), Article 30(5), Article 31(4), Article 32(4), Article 33(8), Article 51a(7), Article 52(4), Article 54(4), Article 58(6), Article 64(7), Article 65(7) and Article 79(8) shall be conferred on the Commission for an indeterminate period of time.

3. The delegation of power referred to in Article 2(3) and (4), Article 4(1), point (2), second subparagraph, Article 4(2), Article 13(1), Article 16(12), Article 23(4), Article 24(13), Article 25(8), Article 27(9), Article 28(3), Article 30(5), Article 31(4), Article 32(4), Article 33(8), Article 51a(7), Article 52(4) Article 54(4), Article 58(6), Article 64(7), Article 65(7) and Article 79(8) may be revoked at any time by the European Parliament or by the Council. A decision to revoke shall put an end to the delegation of the power specified in that decision. It shall take effect the day following the publication of the decision in the Official Journal of the European Union or at a later date specified therein. It shall not affect the validity of any delegated acts already in force.’

;

(b)

paragraph 5 is replaced by the following:

‘5. A delegated act adopted pursuant to Article 2(3) or (4), Article 4(1), point (2), second subparagraph, Article 4(2), Article 13(1), Article 16(12), Article 23(4), Article 24(13), Article 25(8), Article 27(9), Article 28(3), Article 30(5), Article 31(4), Article 32(4), Article 33(8), Article 51a(7), Article 52(4), Article 54(4), Article 58(6), Article 64(7), Article 65(7) or Article 79(8) shall enter into force only if no objection has been expressed either by the European Parliament or the Council within a period of three months of notification of that act to the European Parliament and the Council or if, before the expiry of that period, the European Parliament and the Council have both informed the Commission that they will not object. That period shall be extended by three months at the initiative of the European Parliament or of the Council.’

;

(7)	in Article 90, the following paragraph is added: ‘6. By 5 December 2028, the Commission shall review and assess the impact of the provision on non-objection in Article 33(7) on competition among trading venues, in particular SME growth markets, and its impact on access to capital for SMEs.’.

Article 2

Repeal of Directive 2001/34/EC

Directive 2001/34/EC is repealed with effect from 5 December 2026.

Article 3

Transposition and application

1. Member States shall bring into force the laws, regulations and administrative provisions necessary to comply with this Directive by 5 June 2026. They shall immediately communicate the text of those measures to the Commission.

They shall apply those provisions from 6 June 2026.

When Member States adopt those measures, they shall contain a reference to this Directive or be accompanied by such a reference on the occasion of their official publication. They shall also include a statement that references in existing laws, regulations and administrative provisions to the Directive repealed by this Directive shall be construed as references to this Directive. Member States shall determine how such reference is to be made and how that statement is to be formulated.

2. Member States shall communicate to the Commission the text of the main measures of national law which they adopt in the field covered by this Directive.

Article 4

Entry into force

This Directive shall enter into force on the twentieth day following that of its publication in the Official Journal of the European Union.

Article 5

Addressees

This Directive is addressed to the Member States.