Lyon: Regional fund managers here have no intention of being supervised from Paris, let alone from Paris by way of Brussels, and they are not alone. The Commission’s market integration and supervision package would rewire who watches Europe’s capital markets, and the fight over it will run through the rest of this year.
The package arrived in December 2025 as the operational core of the Savings and Investments Union. Its diagnosis is familiar and correct. European households save heavily and invest timidly, capital sits in deposits earning little, and fragmented supervision keeps firms from operating across borders at reasonable cost.
Its answer upgrades the European Securities and Markets Authority substantially. The authority would become the direct supervisor of significant market infrastructure, taking on certain trading venues, central counterparties, central securities depositories and every crypto-asset service provider in the bloc. That last category consolidates oversight that currently sits with whichever national regulator a firm chose first.
Asset managers escaped the worst of it and are still unhappy. The proposal stops short of direct supervision or supervisory colleges for fund managers, strengthening the authority’s convergence powers instead. But it grants annual review powers over large cross-border groups running 300 billion euros or more, which the industry reads as a first step rather than a limit.
Their trade body has said as much in public, and the opposition to centralised supervision has hardened rather than softened since the package appeared. The argument they make is about proximity. A supervisor in Paris understands a French fund’s distribution network in a way a supervisor in Brussels cannot, and distance produces rules written for the largest firms.
The counter-argument comes from the authority itself and from national regulators who want the integration. France’s markets watchdog has pushed openly for an enhanced role for the European authority, breaking the usual pattern in which every national supervisor defends its own turf.
Trilogues will decide it, and member states divide along predictable lines. Countries hosting large infrastructure resist transfers of supervision they currently hold. Countries whose firms must deal with twenty-seven supervisors want one.
Nothing binds yet. The package remains a proposal, and the negotiation that follows will test whether governments want an integrated market more than they want their own regulators.
