A progress report from the Cyprus Presidency, submitted to COREPER on 25 June 2026, details technical advances but persistent political splits on the Market Integration and Supervision Package (MISP), with the European Council having called for co-legislators to conclude negotiations by end 2026. The report, prepared for the 26 June 2026 COREPER meeting, notes that the Presidency organised 19 Council Working Party meetings and three ECOFIN discussions (10 March, 5 May, 12 June 2026) during the first half of 2026.
The MISP was presented by the European Commission on 4 December 2025 and comprises a Master Regulation, a Master Directive, and a Settlement Finality Regulation. The European Parliament appointed rapporteurs Markus Ferber (Master Regulation), Eero Heinäluoma (Master Directive), and Giovanni Crosetto (Settlement Finality Regulation), with draft reports published on 11 June 2026. The 'One Europe, One Market Roadmap' signed on 24 April 2026 includes the MISP as a priority deliverable with end 2026 as target for agreement.
Key outstanding issues include the calibration of significance criteria for direct European Securities and Markets Authority (ESMA) supervision, the composition and powers of the new Executive Board versus the Board of Supervisors, the role of national competent authorities, mandatory T2S connectivity for central securities depositories (CSDs), open access provisions, and the scope of the Settlement Finality Regulation. These unresolved political divergences will require the incoming Irish Presidency to broker compromises to meet the end-2026 deadline.
The package would significantly reshape EU capital markets supervision. Direct ESMA supervision of significant market players could reduce regulatory fragmentation for large cross-border firms but may increase compliance costs for smaller national players. The governance balance between the Executive Board and Board of Supervisors will determine the relative influence of ESMA versus national authorities. Mandatory T2S connectivity for CSDs could lower post-trading costs for investors but may impose operational burdens on smaller CSDs. Open access provisions could increase competition among trading venues and CCPs, potentially lowering fees for end-users but challenging incumbent business models. The scope of the Settlement Finality Regulation affects legal certainty for payment and securities settlement systems, with implications for financial stability and risk management.