The European Commission has published a report concluding that the European Union’s regulatory framework for money market funds continues to function well overall, alongside Frequently asked questions that provide additional guidance to the sector. The clarifications focus on money market funds’ minimum liquidity levels and on how liquidity buffers may be used, particularly to meet rising redemption requests during periods of market stress, to support more consistent supervision across the EU. The framework has been in application since 2018. Building on the Commission’s 2023 review, the latest analysis finds that money market funds generally take a cautious approach and keep liquidity reserves above the regulatory minimum. The guidance is intended to help fund managers and competent authorities identify situations that may require closer scrutiny and reduce the risk of contagion to the EU financial system and wider economy.
European Commission 2026-05-11
European Commission finds EU money market fund framework functioning well overall and issues FAQs on liquidity buffers
The European Commission has published a report concluding that the EU’s regulatory framework for money market funds continues to function well, accompanied by FAQs providing additional guidance. The clarifications focus on minimum liquidity levels and the use of liquidity buffers, particularly during market stress, and aim to support more consistent supervision across the EU. Building on the Commission’s 2023 review, the guidance is intended to help fund managers and competent authorities identify situations requiring closer scrutiny and reduce contagion risk.