Capital Markets Union: EU Commission adopts amended report on tackling national barriers to cross-border investments

The EU Commission has adopted a report on tackling national barriers to cross-border investments in the EU. The Commission adopted a first version of the report on 27 February 2017, but was made aware of certain inaccuracies, mainly due to incomplete or conflicting information, and has consequently adopted an amended version.

The report is based on the work of an expert group of Member States' representatives alongside the Commission to map national barriers to cross-border capital flows and find the best ways of tackling barriers identified as being not justified by public interest considerations or as being disproportionate. The report follows a call from the ECOFIN Council in 2015 for a roadmap to tackle national barriers and relates to the Commission's work on creating a Capital Markets Union (CMU).

The report distinguishes between different types of national barrier:

• ex ante barriers, which are of immediate concern when investors consider engaging in cross-border activity;
• in itinere barriers, which deter investors from maintaining or increasing their cross-border exposure; and
• ex post barriers, which lead to difficulties at the end of the investment process.

For each type of barrier, the report builds on the Commission's discussions with the expert group and proposes next steps. The barriers identified include withholding tax procedures, residence requirements imposed on the management of financial institutions and a lack of financial literacy.

The report calls on the Member States to endorse the proposed roadmap and take action accordingly.