De-prioritisation of Level 2 acts in financial services legislation

The EU has a comprehensive legal framework, in which many of the rules are regulatory and implementing standards (Level 2) that supplement or specify the EU Regulations and Directives (Level 1). In the last legislature, level 1 acts empowered the Commission to adopt around 430 level 2 measures.

A high volume of level 2 acts can lead to compliance costs and regulatory complexity for stakeholders, while demanding significant resources from co-legislators to scrutinise them. In consultation with the EU co-legislators, the Commission informed the three European Supervisory Authorities and the Anti-Money laundering Authority (AMLA) that it will not adopt these non-essential acts before 1 October 2027. Where empowerments have legal deadlines, the Commission will propose to amend or repeal them during the upcoming revisions of the relevant Level 1 acts.

The Commission's de-prioritisation of some level 2 measures is a pragmatic approach that can deliver simplification quickly, in line with the savings and investments union objectives and the Commission's simplification agenda.