NSSMC and ESMA prepare Ukrainian capital markets for integration into the EU system

The National Securities and Stock Market Commission and the European Securities and Markets Authority (ESMA) identified practical areas of cooperation as part of Ukraine’s preparations for accession to the European Union.

This was agreed upon during a meeting between representatives of the NSSMC and ESMA’s leadership and relevant teams at the Authority’s headquarters in Paris.

Ukraine is gradually transitioning to EU rules in the capital markets sector. Therefore, the Commission is already working to ensure that Ukrainian regulation and supervision comply with European requirements and that market participants are prepared to operate under these rules after Ukraine’s accession to the EU.

Separately, the NSSMC and ESMA discussed how to organize Ukraine’s transition to the European supervisory model. After Ukraine joins the EU, some of the functions currently performed by the Commission will be exercised directly by ESMA. In particular, this applies to the authorization and supervision of credit rating agencies.

The sides agreed that preparations for this need to be made in advance. This will allow a sudden transition for the market to be avoided and ensure uninterrupted oversight after Ukraine joins the EU.

Another area of cooperation involves involving the NSSMC in ESMA’s expert work even before Ukraine becomes an EU Member State. The sides will explore the possibility of NSSMC representatives participating in specific thematic meetings of ESMA’s standing committees, particularly on issues related to financial innovation and investment funds.

This format will enable the NSSMC to present Ukraine’s regulatory developments and receive feedback from ESMA experts and national regulators in EU Member States. This is important so that Ukraine can incorporate European approaches as early as the stage of developing its own regulations.

ESMA is also prepared to involve its specialized teams in consultations with the Commission regarding regulation, supervisory practices, technical standards, and EU guidelines.

The NSSMC and ESMA will continue to discuss the possibility of concluding a Memorandum of Understanding that could outline the main areas of cooperation until Ukraine joins the EU. The sides will still need to agree on the format, content, and timing of a possible signing.

For reference

ESMA, or the European Securities and Markets Authority, is one of the key European Union bodies in the financial supervision system.

While national regulators, such as the NSSMC, are responsible for supervising markets in their respective countries, ESMA operates at the EU level. It promotes the consistent application of rules and supervisory approaches across EU capital markets, coordinates the work of national regulators, and, in certain areas, exercises direct supervision itself.

For Ukraine, cooperation with ESMA is part of its practical preparation for EU accession. The Ukrainian capital market must transition to European rules, and the NSSMC must be ready to operate as part of the common European regulatory and supervisory system.