The EU has a predominantly loan-based system for financing the real economy and therefore relies strongly on banks. To address this, the Commission launched in 2015 an Action Plan on Building Capital Markets Union (CMU) in order to foster the development of EU capital markets and their integration and to ensure alternative sources of funding for businesses, SMEs amongst others. The Action Plan included a number of measures, many of which require cooperation between market participants, Member States and European institutions. Overall, we found that the Commission made small steps towards its goal of building the CMU, but was so far unable to catalyse substantial progress with the measures it was able to take within its remit. We recommend that the Commission proposes well-targeted actions to further facilitate SME access to capital markets, fosters deeper and better integrated local capital markets, addresses key cross-border barriers to investment, defines specific objectives and critical measures as well as develops a system for monitoring the implementation of CMU.
ECA special report pursuant to Article 287(4), second subparagraph, TFEU.