The European Commission, the European Parliament and the EU member states last night reached a political a deal to create the new supervisory bodies.
Officials involved in the deal say the super-structure will have the resources to identify financial risks, the tools to better control financial players and the means to act fast in a co-ordinated way.
The agreement brings an end to fights between member states, particularly Britain, who feared a loss of sovereignty over financial regulation, and a European Parliament concerned about weak agencies ability to correct dangers ahead.
A compromise means member states can appeal the decisions of the new bodies, something fiercely resisted by MEPs.
National capitals will have the critical hand on the alarm bell, with member states declaring if there is an emergency on the cards, not the European Commission or the parliament.
Direct oversight of companies will not be performed by the new agencies, a task to be left with national supervisors. The new agencies are to only co-ordinate actions.
Finally, instead of all being based in Frankfurt, the bodies will now be located in London, Paris and the home of the ECB.
Conservative economic and monetary affairs spokesman Vicky Ford MEP, who took part in the negotiations, says the new structures will protect consumers from future cross-border crises.
“At the same time national governments and national regulators keep their frontline responsibility to protect national tax payers’ interests. It is a pragmatic compromise. Now let’s put it into action,” she says.
