The Chairpersons of the three European Supervisory Authorities (ESAs) – the European Banking Authority, the European Securities and Markets Authority (ESMA) and the European Insurance and Occupational Pensions Authority – have sent a joint letter on cross-selling of financial products to Jonathan Hill, the European Commissioner for Financial Stability, Financial Services and Capital Markets Union.
The letter raises concerns regarding certain legal issues in the existing regulatory framework that have been revealed following the ESAs’ recent work on guidelines on cross-selling practices. Following certain legal concerns that were raised following the ESAs’ consultation on the draft guidelines it was decided that final joint guidelines on cross selling could not be issued and that in order for ESMA to fulfil its obligation under MiFID II to deliver its guidelines on cross selling by 3 January 2016, the ESAs agreed that ESMA-only guidelines for the investment sector should be issued on the sole basis of MiFID II. ESMA published these guidelines on 22 December 2015.
The ESAs’ ask Commissioner Hill if he could assess, as a matter of urgency, the differences in the existing regulatory framework and consider any necessary steps in order to ensure that the ESAs can regulate cross-selling practices in a consistent way across the three sectors. The ESAs mention that a possible opportunity to do so would be in the context of any follow-up the Commission may decide to pursue when addressing the responses to its recently published Green Paper on Retail Financial Services in the Banking and Insurance Sectors and/or to its Call for Evidence on the regulatory framework in financial services.