The future of ESMA and a single listing authority and securities regulator for the CMU: Costs, benefits and legal impediments

This chapter contributes to the study of the Capital Markets Union (CMU) by proposing centralization of scrutiny and approval of public offers of securities and of securities listings in the EU. Both competences are presently reserved for national authorities under European Union (EU) law and the objective of market integration is achieved by means of the EU passport provided in the Prospectus Directive and the regulation of listing conditions provided in the Listing Directive. In addition, the EU lacks a centralized securities authority dealing with supervision and enforcement of securities laws in the manner of the Securities and Exchange Commission (SEC) in the USA. Given the unique challenges the CMU brings as regards the supervision and enforcement of securities laws in integrated EU capital markets, this is an untenable state of affairs. We also debate the merits of a pan-European capital markets authority. The establishment of such an EU agency would, prima facie, create considerable economies of scale in terms of informa-tion gathering and enforcement for the CMU. An EU-SEC would probably, but not necessarily, also serve, through a separate division, as a pan-European Listing Authority (EULA).