Market building and the Capital Markets Union: addressing information barriers in the SME funding market

Schammo, P.

Abstract

The Capital Markets Union (CMU) is one of the flagship policy initiatives of the Juncker Commission. The Commission’s strategy for realizing a CMU is set out in its White Paper on building a CMU. Besides describing the Commission’s vision of a CMU, the white paper includes an action plan which details the measures that are needed to build a CMU. The aim of this article is to consider the Commission’s measures in one particular area of the action plan. Specifically, this article examines the Commission’s strategy for overcoming information barriers to SME investment. By acting in this area, the Commission’s objective is to facilitate access to finance, but also to diversify sources of funding for SMEs, which are traditionally heavily dependent on bank-based finance. This article evaluates the Commission’s strategy and its prospects of success. After assessing the relevant policy measures, it will argue for a paradigm shift which is based on three pillars: a greater emphasis on market building measures; a greater emphasis on information sharing duties as one mechanism that can help to address information barriers; and a market correcting strategy to dovetail greater market building.

Citation

Schammo, P. (2017). Market building and the Capital Markets Union: addressing information barriers in the SME funding market. European Company and Financial Law Review, 14(2), 271-313. https://doi.org/10.1515/ecfr-2017-0014

• Journal Article Type: Article
• Acceptance Date: Mar 6, 2017
• Online Publication Date: Aug 23, 2017
• Publication Date: Aug 23, 2017
• Deposit Date: Mar 6, 2017
• Publicly Available Date: Aug 23, 2018
• Journal: European Company and Financial Law Review
• Print ISSN: 1613-2548
• Electronic ISSN: 1613-2556
• Publisher: De Gruyter
• Peer Reviewed: Peer Reviewed
• Volume: 14
• Issue: 2
• Pages: 271-313
• DOI: https://doi.org/10.1515/ecfr-2017-0014
• Public URL: https://durham-repository.worktribe.com/output/1392167