Consumer Protection and Financial Innovation - Objectives and Tasks

The Joint Committee aims to ensure the necessary degree of cross-sectoral consistency amongst the ESAs in relation to matters pertaining to consumer protection and financial innovation. In particular, it:​

  • Promotes transparency, simplicity and fairness for cross-sectoral consumer financial products or services across the internal market;
  • Monitors new and existing cross-sectoral activities with a view to promoting the safety and
  • soundness of markets and convergence of regulatory practice;
  • Fulfils any other specific tasks set out and agreed by the ESAs´ governing bodies, as
    appropriate. 

More concretely, article 9 of the ESA Regulations requires each of the ESAs to take a "leading role in promoting transparency, simplicity and fairness in the market for consumer financial products or services across the internal market", including by:

  • Collecting, analysing and reporting on consumer trends;
  • Reviewing and coordinating financial literacy and education initiatives by competent authorities;
  • Developing training standards for the industry; and
  • Contributing to the development of common disclosure rules.

In addition, the ESAs are required to:

  • Monitor new and existing financial activities;
  • Establish respective Committees on financial innovation with a view to achieving a co-ordinated approach to the regulation and supervisory treatment of new or innovative financial activities.

The ESAs may:

  • Develop common methodologies for assessing the effect of product characteristics and distribution processes on the financial position of institutions and on consumer protection (Article 8(2)(i) of the ESA Regulations);
  • Adopt guidelines and recommendations to promote safety and soundness of markets and convergence of regulatory practice;
  • Issue warnings in case a financial activity poses a serious threat to their core objectives; and Within specific parameters, temporarily prohibit or restrict certain types of financial activities that threaten the orderly functioning of financial markets or the stability of the whole or part of the EU's financial system.