Savings and Investment Union – Finnish Venture Capital Association’s comments

A harmonized regulatory environment is crucial for fostering a predictable and efficient investment landscape, promoting cross-border financial activities, and strengthening the EU’s position as a competitive market for company growth. While EU challenges have been widely discussed, the EU has significant strengths to build on. The newfound determination for a more uniform and coherent approach is welcome and should lead to a stronger union in the near future. 

Currently, a key challenge is the presence of national regulatory discretion despite partial EU-level harmonization. While some regulatory aspects are unified, substantial national leeway remains, causing market fragmentation. Diverse legal traditions and interpretations among Member States further contribute to regulatory inconsistencies, reducing predictability for market participants and increasing compliance burdens. 

To enhance the efficiency of the European investment market, the following measures should be prioritized: 

1.Facilitating cross-border fund marketing within the EU – Reducing administrative barriers and regulatory discrepancies will improve capital flows and encourage investment across Member States. 

2.Establishing a uniform supervisory approach – A consistent regulatory enforcement mechanism is essential to ensure a level playing field and enhance legal certainty. The most crucial questions requiring interpretation should be addressed by ESMA. Market participants should also have the opportunity to seek clarification on EU legislation’s interpretation from ESMA. 

3.Developing a pan-European investment vehicle with harmonized taxation – A standardized investment vehicle with coordinated tax treatment would be a significant step toward an integrated European investment market, reducing compliance costs and uncertainty. 

We urge the European Commission to take decisive steps in advancing regulatory harmonization and remain available for further discussions on implementing these objectives effectively. 

Finnish Venture Capital Association
Suvi Collin
Head of Legal & ESG
+358 50 560 3532
suvi.collin@fvca.fi