European Commission Publishes Savings and Investments Union Strategy

On March 19, 2025, the European Commission published the Communication on its strategy for the Savings and Investments Union (SIU) to improve the channelling of savings into productive investments. Treating this initiative as a key priority, the Commission aims to boost the EU's economic competitiveness, in line with the Commission's EU Competitiveness Compass, and to implement the plans in the Clean Industrial Deal.

The Communication on the SIU outlines four interrelated categories of legislative and non-legislative policy measures, many of which will be important to note for financial services providers, including insurers.

Citizens and Savings

The Commission puts forward multiple measures to encourage and incentivize EU retail savers to hold more of their savings in capital-market instruments, including:

• Adopting legislative and non-legislative measures to create a "European blueprint" for savings and investments accounts/products by Q3 2025 and issuing recommendations to Member States on tax treatment of these accounts/products.
• Facilitating agreement on the Retail Investment Strategy (RIS), although if negotiations do not meet the intended objectives of the RIS, the Commission is prepared to withdraw the proposal.
• By Q4 2025, issuing recommendations on auto-enrolment mechanisms for pension savings, pensions tracking systems, and pension dashboards.
• Reviewing the existing EU frameworks on for Institutions for Occupational Retirement Provision (IORPs) and the Pan-European Pension Product (PEPP) by Q4 2025.

Investment and Financing

The Commission plans a number of initiatives to promote investment in equity and, in particular, venture capital/growth capital, including:

• By Q4 2025, the Commission will amend the Solvency II Delegated Act to specify eligibility criteria for favorable prudential treatment of insurers' long-term investments in equity. Banks will receive guidance on favorable prudential treatment of investments under legislative programs, with the possibility of replicating the same treatment for insurers in the Solvency II Delegated Act and allowing such investments for pension funds under the prudent person principle.
• Simplifying securitization due diligence and transparency requirements, and adjusting securitization-related prudential requirements for banks and insurers in Q2 2025.
• Reviewing the EuVECA Regulation by Q3 2026 to make the label more attractive, including by broadening the scope of investable assets and strategies.
• Actions to remove differences in national taxation procedures creating administrative burden and barriers to cross-border investment, and to address any other obstacles hindering institutional investors' access to equity.

Integration and Scale

In an attempt to remove the remaining sources of fragmentation in EU capital markets, the Commission puts forward a number of measures:

• Setting up a dedicated channel for all market participants to report on encountered barriers within the single market in Q2 2025. The Commission will intensify enforcement actions to accelerate the removal of the existing barriers. In particular, the Commission will prioritize the detection and removal of gold-plating of EU legislation at national level and reducing national options and discretion.
• In Q4 2025 the Commission is planning to unveil a legislative package aimed at further integrating trading and post-trading infrastructures. The package will include rules on central securities depositories, financial collateral, settlement, and the trading market structure.
• In Q4 2025 the Commission is planning to propose legislation to remove remaining EU-level and national barriers to the distribution of EU-authorized investment funds across the EU.
• The Commission will consider a potential review of the Shareholders Rights Directive by Q4 2026.

Efficient Supervision

Ensuring efficient and harmonized supervision is also a priority of the SIU. To achieve this, the Commission:

• Called on the European Supervisory Authorities (ESAs) and national supervisors to fully utilize the available supervisory convergence tools,
• Will propose measures in Q4 2025 to strengthen supervisory convergence tools, and
• Will make proposals in Q4 2025 to achieve more unified supervision of capital markets, including by transferring certain tasks to the EU level.

Stakeholder Reactions

European Council

The heads of state/government of the of the 27 EU Member States already discussed the Commission’s SIU strategy at the European Council meeting on March 20. This shows the importance of the SIU on the current political agenda of the EU.

The European Council conclusions call on the European Parliament and the Council to quickly agree on all pending proposals from the 2020 Action Plan on the Capital Markets Union, including on insolvency. The European Council also stresses a number of measures listed in the Commission's SIU strategy and calls on the Commission:

• To advance work, together with the Member States, towards greater retail participation in capital markets by making available European investment and savings possibilities, including enhanced possibilities for EU-wide savings and pension products, to allow decisive steps to be taken in 2025;
• To swiftly propose, by the end of 2025, improvements to the existing PEPP framework;
• To put forward proposals to improve the private equity and venture capital ecosystem and a proposal for an optional 28th company law regime, so that the co-legislators can take decisive steps by 2026;
• To swiftly propose, by the end of 2025, a revised securitization framework, including targeted adjustments to the prudential framework;
• To keep under review the global level playing field in the banking and insurance sectors and take appropriate measures;
• To ensure convergent supervisory practices;
• To complete the assessment of and determine the conditions for enabling the ESAs to effectively supervise the most systemic relevant cross-border capital and financial market actors and, on the basis of that assessment propose appropriate measures for supervision;
• To swiftly remove barriers to market-led consolidation of market infrastructure and to cross-border investment;
• To streamline existing rules and eliminate duplication, clarify regulatory provisions and reduce the cost of compliance and reporting.

European Insurance and Occupational Pensions Authority (EIOPA)

EIOPA has also welcomed the Commission's SIU strategy and emphasized the following points:

• The important role of insurance and pension savings in supplying the necessary capital for long-term investments. In particular, the reviews of the IORP II Directive and the PEPP framework would contribute to achieving the SIU's objectives.
• The need for a wider range of simple, transparent and reliable insurance and pension products that offer value for money and that are suitable for long-term savings.
• The need for stronger supervision to protect consumers and ensure a stable and fair environment for businesses in light of the increasing importance of cross-border activities. EIOPA considers that, similar to the SIU proposal for capital markets, more unified supervision would be beneficial for the insurance sector since supervisory convergence tools have their limits.

Conclusion

The SIU strategy provides a roadmap of the Commission's legislative initiatives for 2025-2026 related to capital markets, and savings and investment regulation more broadly. Overall, the SIU strategy holds the potential to enhance cross-border business opportunities and reduce fragmentation for the provision of certain financial services throughout the EU. It remains to be seen whether the initiatives will be sufficiently ambitious to realise that potential. While the SIU strategy is not intended to create additional regulatory burdens, certain proposed measures, such as the RIS, the review of the PEPP framework and the shift towards more unified supervision, may require financial services providers to adjust their compliance and operational strategies/policies.

With many legal instruments expected to be published this year already, our team will continue to monitor and analyze developments to provide a clear roadmap for how the announced SIU strategy evolves into regulatory requirements.