The European Commission adopted a proposal for a Council Decision this week (31 May 2016) on the incorporation of the Regulations on the European Supervisory Authorities and some of the related Regulations and Directives into the Agreement on the European Economic Area (EEA). This is an important step towards the extension of the European System of Financial Supervision (ESFS) to the EEA EFTA countries: Norway, Iceland and Liechtenstein.
One of the cornerstones of the EU's response to the 2008 financial crisis was the establishment of the European System of Financial Supervision (ESFS), which, among other things, led to the creation of the European Supervisory Authorities (ESAs).
The EEA EFTA countries fully participate in the EU’s internal market as foreseen by the EEA Agreement. With this Commission proposal, strong and coordinated financial supervision would be extended across the entire EEA.
The acts to be incorporated into the EEA Agreement are the ESAs Regulations (EBA, EIOPA and ESMA Regulations), the European Systemic Risk Board Regulation, the Alternative Investment Fund Managers Directive and related Delegated Acts, the Short Selling Regulation and related delegated acts, the European Markets Infrastructure Regulation ('EMIR') and the Credit Ratings Agency Regulations.
In order for this package to enter into force, it needs to be approved by the national parliaments in the EEA EFTA States and the Council of the EU. Consequently, it is due to be formally adopted in the EEA Joint Committee.