Simon Lovegrove: Moving towards a single EU guidebook

The idea is quite simple and envisages that key technical rules should be defined at the EU level and adopted through EU regulations rather than directives, so that they are directly applicable in member states including to financial institutions operating in the single market, without any need for national implementation or possibility for additional layers of local rules.

To supplement this, one of the tasks of the European Supervisory Authorities (Esma, the EBA and Eiopa) is the drafting of regulatory or implementing technical standards that, once endorsed by the European Commission, become legally binding across the EU.

However, the concept of the Single European Rulebook has been discussed for some time but it is now clear that the Commission is pushing forward with it.

The reason why I found Mr Enria’s speech so interesting was the point he made near the end. Mr Enria recognised that the Single Rulebook could bring about a major change in the EU but that there was a particularly difficult hurdle to overcome. That hurdle was the convergence in national supervisory practices. Supervisory approaches and traditions are quite diverse in the EU and this could mean that even with exactly the same rules, supervisory outcomes in Member States can remain quite different. To combat this Mr Enria called for the development of a single guidebook for supervisors - a manual that would define common procedures and processes for regulators.

The concept of a single guidebook is nothing new in the US where the Federal Financial Institutions Examination Council has defined common procedures and training for examiners to ensure consistency across all Federal supervisory agencies. However, could a single guidebook become a European reality? Given how the Commission is moving forward with regulatory reform I think it may be considered a distinct possibility but I believe there would be a great deal of politics to play out before it actually happens.

Simon Lovegrove is a lawyer for the law firm Norton Rose LLP