The European Union’s push to simplify financial reporting faces a complex reality, with industry leaders warning that streamlining requirements will likely hike costs before delivering relief.
At ESMA’s inaugural Data Day, last week in Paris, the regulator acknowledged what firms have argued for years: the European Union’s supervisory reporting framework has become too complex, fragmented and duplicative.
Verena Ross, chair of ESMA, made clear that simplification does not mean deregulation. “It means making rules clearer, reducing unnecessary reporting fields and flows, removing duplication, and ensuring that reporting serves its purpose without imposing unnecessary costs,” she told the audience.
Yet even with a promise of coherence, firms anticipate a challenging transition. “Simplification does not immediately mean burden reduction,” Lucas Schmeddes, president and chief operating officer of ICE Endex, the London-based European gas and power exchange, told participants. “Because of the investment we need to make in the changes, the burden for the industry will probably increase.”
Reporting layers
Europe’s reporting architecture reflects more than a decade of post-crisis reforms. EMIR governs derivatives, MIFID covers transaction reporting, SFTR applies to securities financing and REMIT to energy markets. Each regime uses its own data model and delivery channel.
The result is parallel reporting pipelines and duplicated submissions. An exchange-traded derivative may be reported once to an EMIR trade repository and again to a national regulator under MIFID, often with small but consequential differences in data fields.
The operational weight is significant. Euronext told ESMA it sends more than 100 files a day to various authorities because national and EU reporting systems still diverge.
New platform
Fabrizio Planta, head of data intelligence and technology at ESMA, said industry feedback has consistently highlighted overlaps between regimes, especially for exchange-traded derivatives reported simultaneously under EMIR and MIFID. ESMA’s 2025 call for evidence confirmed those concerns, prompting the regulator to pause certain MIFID reporting changes to avoid deepening duplication.
In a call with journalists last week, Planta explained that ESMA’s broader reform effort is increasingly tied to ESAP, the European Single Access Point, a new EU platform scheduled for launch in 2027 that will centralise publicly available regulatory data. By funnelling information into a single interface rather than multiple national or sector-specific channels, ESAP intends to facilitate easier access for market participants and support more efficient data sharing among authorities, reducing the need for repetitive reporting across regimes, according to Planta.
In the meantime, a two-step roadmap guides ESMA’s work for next year. The authority plans to publish an initial report summarising key findings from its 2025 call for evidence in the first quarter of 2026, followed by a final report with legislative and technical recommendations before the summer.
Entrenched fragmentation
Some challenges run deeper than data fields. the data day discussions made clear. Joachim Kuhnen, legal counsel for operations at DZ Bank in Germany, pointed to uncertainty around basic definitions as the EU prepares for T+1, the shift to a next-day settlement cycle. “What is a working day? Is that a working day in Germany? Is it a working day in one of the 16 federal states in Germany?” he asked.
The push for simplification also revived a broader discussion about Europe’s supervisory model. Nicolas Véron, senior fellow at Bruegel, reiterated his call for ESMA to become a single, direct supervisor for EU capital markets, arguing that the current division of responsibilities between national authorities and ESMA remains a “halfway house” that entrenches fragmentation.
National regulators took a more cautious view. Christophe Bonnet of the Autorité des marchés financiers in France acknowledged a sense of “fatigue” after 15 years of continuous implementation. He welcomed the opportunity to reassess the efficiency of reporting regimes, but stopped short of supporting a full shift of supervisory powers to ESMA.
Need for prudence
Reaching a more streamlined system will require legislative change, harmonised data standards across multiple regimes and significant investment from firms. Rosa Armesto, director general of the Federation of European Securities Exchanges, warned that accelerating reforms without full coordination could create new inefficiencies rather than remove old ones.
“High quality data remains critical, and remains very important,” Armesto told delegates. “As market operators, we stand very strong on that, on the high quality, but equally reliability of the data. Some sort of prudency is also very much advised.”