World Federation of Exchanges urges European Commission to refocus the Savings and Investment Union on tax reform, investor access and proportionate regulation

The World Federation of Exchanges has published its response to the European Commission’s consultation on the Savings and Investment Union, backing the agenda’s simplification and burden-reduction aims but arguing that growth will not be delivered by structural supervisory reforms alone. It cautions that creating a single supervisory authority would not, in itself, attract investment or generate economic growth in European capital markets. Instead, the WFE calls for measures it considers more directly growth-oriented, including deeper tax reforms beyond tax-advantaged investment accounts, such as removing transaction taxes, reducing listing costs and addressing debt-equity bias. It also urges greater investor empowerment through access to risk-management tools such as regulated derivatives, fewer barriers to market entry, and an approach to investor protection that incorporates financial literacy and experience. On regulation, it advocates shifting from prescriptive rules to proportional, principles-based requirements and warns that burdens associated with proposals such as EMIR 3.0 and the Digital Operational Resilience Act could slow innovation and post-trade infrastructure upgrades. The response further supports market-led consolidation of financial market infrastructure and highlights concerns about increasing internalisation of order flow into bilateral venues, pointing to potential impacts on liquidity, best execution, price discovery and listing decisions.