AEIP responds to the European Commission’s targeted consultation on the review of the ESAs
AEIP provided its input to the European Commission’s consultation on the review of the European Supervisory Authorities and the creation of a Single Rulebook. AEIP and its member organizations underlined that the supervision of EIOPA regarding IORPs and provident institutions of social protection should be kept to a minimum level of harmonisation, as IORPs and provident institutions fall under the scope of national social and labour law (SLL) and are subject to national supervision. In particular, these hold an important social function and are part of the triangular relationship between the employee, the employer and the social protection institution. AEIP strongly believes that the NCAs are best placed to judge the risks, vulnerabilities, threats and weaknesses of the system given the local labour market, the social and labour legislation as well as the local social environment, and to take any action required. Hence, EIOPA and the other EU institutions should trust the ability of NCAs to ensure the effective application of EU rules and should make sure that all available national ways and tools have been used before any enforcement decision is taken.
At the same time, although most powers of ESMA do not directly affect pension funds, AEIP would welcome a re-evaluation of ESMA’s powers by the European Commission. We believe this assessment should be based on the level of cross-border market integration, the interconnectedness and systemic relevance of the activity in question.
On the involvement and role of relevant stakeholders, AEIP stressed that these should be consulted in a wide array of issues and policy developments, as part of the activities of EIOPA. AEIP appreciates the regular opportunities for participating in stakeholder consultations and policy workshops, thus being able to discuss and provide its expertise as well as this of its members for the advancement of good policymaking. Nevertheless, we would like to stress that for future consultations EIOPA should give enough time and inform in advance the relevant actors on upcoming events and consultations, in order for the latter to conduct technical work and mobilise in time experts for bringing a tangible added value to the policy debates.
As pension funds and provident institutions are not directly supervised by EIOPA, there is the understanding that they should not pay industry fees to EIOPA. AEIP understands the need for some degree of flexibility in the ESAs’ funding arrangements to deal with changes to the volume of work which is delegated to them. However, we strongly prefer that the solution for this problem is found within the current funding system based on contributions by NCAs and the Union budget. One solution could be to fully fund EIOPA through the Union budget.
We believe that the mandates given to the ESAs in Level 2 have been too wide, which could hurt the democratic legitimacy of the EU law-making. Therefore, we think that further convergence, in areas where it is desired, should be achieved at Level 1. In addition, the timelines for developing Level 2 measures should be realistic and need to be longer in some cases (e.g. SFDR). Moreover, ideally Level 1 legislation would automatically be delayed if Level 2 measures cannot be adopted in time. Otherwise financial institutions will need to spend double the effort in implementing regulation.
Please see here the detailed contribution of AEIP to the European Commission’s consultation.