On September 30, simultaneously to its publication of the Capital Markets Union (CMU) Action Plan, the European Commission (EC) launched a Call for Evidence on the EU Regulatory Framework for Financial Services (Consultation).

Given the significant amount of legislation directed at the financial services industry in recent years, including the plethora of new rules aimed at financial institutions and markets as well as market infrastructures, the objective of the Consultation is to assist the EC in understanding the combined impact of all these new rules and whether they give rise to any unintended consequences, in particular with respect to diminishing competition by the creation of barriers to entry by new market participants, and identifying areas where further action is needed to support the promotion of jobs and growth.

In pursuing its objective, as part of the Consultation, the EC is specifically wishing to gather feedback on the following:

• rules affecting the ability of the European economy to finance itself and grow – to ensure that rules put in place to provide financial stability and investor protection do not unduly discourage long-term investment and sustainable economic growth;

• unnecessary regulatory burdens – to ensure that new rules are not overly complex or duplicative, or disproportionate when the associated policy objectives are considered;

• interactions, inconsistencies and gaps – to ensure that rules, when taken together, do not result in, for example, duplications, inconsistencies or regulatory gaps of loopholes; and

• rules giving rise to unintended consequences – to remove the possibility of regulatory arbitrage.

The responses to the Consultation will provide the EC with a clearer understanding of the cumulative impact of all the rules, together with important guidance when the EC is preparing, if considered appropriate, a formal EC proposal.

The Consultation can be accessed here. Responses to the Consultation must be made by January 6, 2016 at the latest via the online questionnaire only (which can be accessed here). All feedback provided should be supported by relevant and verifiable empirical evidence and concrete examples (with underlying assumptions being clearly set out).