By Susan Revell, EMEA General Counsel
Europe’s agenda to grow deeper, more connected capital markets is central to its broader drive to marshal the investment needed to enable structural changes and unleash productive economic growth. Asset managers are key to that growth.
Europe already has one of the world’s most integrated asset management industries. Thanks to the UCITS and AIFMD passporting frameworks, firms can establish products in one Member State and offer them across the EU, giving millions of investors access to a broad range of investment opportunities. This is a major European success story — one that has made UCITS a trusted investment product globally - but one that cannot be taken for granted.
The next phase of the Savings and Investment Union should build on these foundations by making cross-border fund distribution as seamless as possible. The Commission’s proposals under the Market Integration and Simplification Package (MISP) provide an important opportunity to reduce unnecessary friction, enhance Europe’s attractiveness as a location for asset management and preserve the appropriate standards of investor protection that underpin confidence in European markets.
We particularly welcome the move towards “passporting upon authorisation”. Today, operational and supervisory divergences between Member States can delay product launches and create unnecessary costs for firms seeking to distribute funds across Europe. Simplifying these processes would lower the cost of doing business for firms of all sizes, accelerate access to markets and make Europe’s fund passports work more effectively.
These benefits would extend well beyond the industry. More efficient cross-border distribution would enable funds to achieve greater scale by reaching investors across the EU more easily. Larger funds can spread fixed costs over a broader investor base, helping to reduce costs for end investors while improving choice and access. This is precisely the type of practical integration that strengthens European capital markets while delivering tangible benefits for end investors.
Unlocking the Next Stage of Integration
Digitalisation can also play an important role. More consistent digital processes and greater standardisation of regulatory reporting can reduce duplication, improve data quality and streamline interactions between firms and supervisors. Initiatives such as an ESMA-run reporting platform could support this objective, provided they are designed around a “define once, report once” principle that avoids creating duplicate reporting obligations or additional layers of cost.
Alongside digitalisation, effective and efficient supervision will remain a cornerstone of Europe’s competitive asset management industry. As cross-border activity continues to evolve, further strengthening supervisory coordination can enhance the efficiency and consistency of supervision, while preserving the clear expertise and accountability of national competent authorities.
As policymakers consider supervisory reforms, it is equally important to distinguish between the needs of different financial sectors. Unlike some other market participants, asset management does not require a single centralised supervisor to support an integrated market. The priority should instead be to improve supervisory convergence while avoiding duplication and ensuring that existing structures work more effectively together, benefiting supervisors and supervised entities.
Our experience at BlackRock illustrates the value of this approach. For several years, we have participated in a voluntary supervisory college, which brings together our principal supervisors from across Europe in a single forum. The arrangement has improved information sharing, reduced the risk of multiple and uncoordinated information requests and enabled more coordinated engagement, while fully respecting the responsibilities and expertise of national supervisors. It has strengthened supervisory understanding without introducing additional decision-making layers.
This model offers a practical blueprint for the future. Standardised information sharing and coordination forums can enhance efficiencies across borders while allowing national supervisors to retain responsibility for local investor protection. Such an approach delivers greater consistency without creating unnecessary complexity or overlapping oversight.
Europe’s asset management industry already demonstrates what successful Single Market integration can achieve. The next stage should focus on removing the remaining operational barriers that prevent firms from serving investors seamlessly across borders. By facilitating cross-border distribution, reducing duplication and strengthening supervisory cooperation through proportionate tools, Europe can enhance competitiveness, deepen its capital markets and help more Europeans move form savers to investors. That is a genuine win-win for the industry, for regulators and, most importantly, for European investors.
