This Week in Finance — Brussels (#21, 2026)
Basel III market risk: new EU adjustments; MiFID output-based financing debate; Reverse charge mechanism and VAT fraud under scrutiny; OSS reform debated; European Semester Spring Package released
May 31, 2026 to June 06, 2026
Basel III market risk: new EU adjustments; MiFID output-based financing debate; Reverse charge mechanism and VAT fraud under scrutiny; OSS reform debated; European Semester Spring Package released
📋 In This Week's Newsletter
• 📅 This Week's Calendar in Brussels
• 🇪🇺 European Commission
• ⚖️ EU Legislation
• 🤝 EU Council
• ✒️ EP Committee Work
• 📚 What We're Reading This Week
This Week's Calendar in Brussels
- Committee on International Trade (INTA): On June 08, the European Parliament's Committee on International Trade (INTA) is scheduled to meet. Agenda includes: Chair’s announcements; Date of next meetings; Monitoring and controlling drug precursors and repealing Regulations (EC) No 273/2004 and (EC) No 111/2005.
- Committee on Budgets (BUDG): On June 10, the European Parliament's Committee on Budgets (BUDG) is scheduled to meet. Agenda includes: * * *; ------; Chair’s announcements.
- Eurogroup: On June 11, the EU Council's Eurogroup configuration is scheduled to hold an eurogroup ministerial meeting in Brussels.
- Economic and Financial Affairs Council: On June 12, the EU Council's Economic and Financial Affairs Council configuration is scheduled to hold an ministerial meeting in Brussels.
European Commission
Commission adopts temporary adjustments to Basel III Market Risk Rules to safeguard EU banks' competitiveness
On 3 June, the European Commission introduced targeted, time-limited amendments to the EU's Basel III market risk capital framework for banks, under the Capital Requirements Regulation (CRR). The adjustments, which involve a new multiplier and will apply from 1 January 2027 for three years, are intended to address the competitive distortions arising from delays in implementation of the Fundamental Review of the Trading Book (FRTB) by other major jurisdictions. The Commission stated that while the EU has implemented all other Basel III standards since 2025, a further deferral is no longer possible under current law. The delegated act, drafted after public consultation, will enter into force unless the European Parliament or Council raise objections during a scrutiny period. The move is linked to the objectives of the Savings and Investments Union.
EU Legislation (Official Journal)
Commission Delegated Regulation (EU) 2026/440: Amending calculation of resolution fund contributions
Published 3 June, Delegated Regulation (EU) 2026/440 amends Delegated Regulation (EU) 2015/63 to update the methodology for calculating contributions of credit institutions and investment firms to national resolution financing arrangements, as required by Directive 2014/59/EU. Major changes include adjustments to risk indicators—such as the deletion of 'own funds and eligible liabilities held by the institution in excess of MREL', and an updated definition for investment firms. It also introduces simplified procedures for smaller firms and time limits for restatements. The regulation takes effect from 1 January 2026, with certain provisions effective in 2027.
Commission Delegated Directive (EU) 2026/374: Amending rules for third-party research and execution service payments under MiFID
On 2 June, Delegated Directive (EU) 2026/374 was published, amending Delegated Directive (EU) 2017/593 under MiFID II regarding payment for execution and research services by investment firms. The new rules allow firms the option to pay jointly or separately for such services, with requirements for quality assessment of research irrespective of payment method. The directive aims to encourage investment research on SMEs and improve comparability, while introducing stricter demands for the annual assessment of research quality by investment firms. Member States must transpose the directive by 5 June 2026, for application from the following day.
EU Council
Upcoming ECOFIN to debate CBAM and Savings & Investment Union
The Economic and Financial Affairs Council is scheduled to meet on 12 June. The agenda includes reaching a position on the Carbon Border Adjustment Mechanism (CBAM) ahead of negotiations with Parliament, and holding a policy debate on the market integration and supervision package under the Savings and Investment Union.
EP Committee Work
FISC hearing examines effectiveness of the reverse charge mechanism in combating VAT fraud
On 2 June, the Subcommittee on Tax Matters (FISC) held a public hearing, 'Combating VAT Fraud: Evaluating the Impact and Future of the Reverse Charge Mechanism'. Expert witnesses, including Prof. Dr. Rita de la Feria (University of Leeds), Christine Weinzierl (Accountancy Europe’s VAT Task Force), and Marta Val Jiménez (Repsol), assessed the effectiveness of reverse charge rules under Articles 199a and 199b of Directive 2006/112/EC, which are set to expire at end-2026. Discussion focused on the mechanism's utility in tackling Missing Trader Intra-Community (MTIC) fraud, administrative complexity, sectoral risks, and the development of digital reporting requirements (DRR) as a future alternative. EPRS briefing materials highlighted the shifting nature of VAT fraud and emerging policy tools.
ECON adopts reports on a coherent tax framework for the EU financial sector and tax aspects of 'EU.inc'
On 4 June, the ECON committee adopted reports addressing the tax dimensions of the proposed 'EU Inc.' (28th regime) and the need for a more coherent tax regime for the EU financial sector. The 'EU Inc.' report, led by rapporteur Ľudovít Ódor (Renew, SK), calls for coordinated corporate tax rules for the 28th regime, with safeguards against tax avoidance. The financial sector report, from rapporteur Matthias Ecke (S&D, DE), scrutinizes the current VAT exemption for financial services and highlights the fragmentation of sectoral taxes, suggesting the Commission review potential reforms for the sector's VAT framework.
BUDG committee holds public hearing on performance-based financing and structural investment under NRPPs
On 3 June, the Committee on Budgets (BUDG) hosted a public hearing on 'NRPPs and lessons from the RRF delivery model: long-term EU resilience and social cohesion in the context of demographic challenges'. Panelists—including Ivana Maletić (European Court of Auditors), Livia Vašáková (Slovak RRF), and Guntram Wolff (Bruegel)—discussed conditionality frameworks, flexibility versus predictability in investment planning, and the implications of demographic shifts. The hearing highlighted the complexities of output-based financing for complex social programmes and the need for performance frameworks that balance administrative simplicity with tailored interventions.
What We're Reading This Week
- EU keeping Russia’s Arctic LNG project ‘alive’, despite year-end import ban: European imports of Russian Arctic LNG have surged, highlighting loopholes in EU sanctions despite an upcoming official ban.
