Part of objective 1 of the capital markets union (CMU) action plan, action 2 aims to support companies' access to public market
Making public capital markets more attractive for EU companies and facilitating access to capital for SMEs
Following up on the TESG recommendations, and building on the SME listing act and the measures already adopted by the co-legislators as part of the Capital Market Recovery Package, on 7 December 2022 the Commission adopted its ‘Listing Act’ legislative package. The package puts forward a broad range of legislative changes that aim at cutting red tape for companies, in particular SMEs, wanting to raise funds on EU public markets, while preserving market integrity and investor protection. The legislative changes include
- for issuers’ prospectuses, easier and cheaper for first time issuances, simplifications or even exemptions for companies known to investors, more efficient approval processes
- for market abuse rules, greater legal clarity on the disclosure of inside information and its timing, reviewed rules on managers’ transactions, insider list and market sounding regimes, a more proportionate sanctioning regime for SMEs and greater supervisory cooperation
- the possibility for companies in all Member States to use Multiple-Vote Share structures when going public on SME growth markets, subject to certain safeguards to protect minority investors
- higher market capitalisation threshold for SME investment research unbundling rules in MiFID II, to support SME listings on public markets, and
- the repeal of the outdated Listing Directive, with a limited number of relevant provisions amended as necessary and transferred to MiFID II
To prepare the legislative package, the Commission launched an open public consultation and a targeted consultation that ran until 25 February 2022. The listing act legislative package was adopted on 7 December 2022.
- Open public consultation on the listing act
- Targeted consultation on the listing act
- Listing act legislative package – 7 December 2022
- Council agrees its negotiating mandate on the listing act
- Council adopts negotiating mandate on multiple-vote share structures
- European Parliament press release: Deal reached on improving SMEs' access to market-based finance
- Council press release: Listings on European stock exchanges: Council and Parliament agree on new act
Technical Expert Stakeholder Group (TESG) on SMEs
Broadening access to market-based sources of financing for European companies at each stage of their development is at the heart of the capital markets union. To do so, the CMU initiative has strived to create a more conducive regulatory framework supporting access to public funding for small and mid-sized Enterprises (SMEs). In October 2020, as mandated by Regulation 2019/2115 as regards the promotion of the use of SME growth markets, the European Commission set up a Technical Expert Stakeholder Group on SMEs (TESG) that brought together relevant stakeholders with technical expertise on SMEs’ access to finance. The Group was tasked with monitoring and assessing the functioning of SME growth markets, as well as providing expertise and possible input on other relevant areas of SME access to public markets. Their work was finalised in May 2021 and culminated with their final report setting out 12 concrete recommendations to foster SME listing.
On the basis of the TESG recommendations, and building on the SME listing act and the measures adopted by the co-legislators as part of the Capital Market Recovery Package, , on 7 December 2022 the Commission adopted a package of legislative proposals (the Listing Act) that cut red tape for companies wanting to raise funds on EU public markets, while preserving market integrity and investor protection. The proposal critically assesses the rules applicable to companies going through a listing process and companies already listed on EU public markets.