Cybersecurity takes top billing in the European Union's upcoming Fintech Action Plan, with a draft emphasising efforts to improve cooperation and coordination between market participants and regulators.
Recognising its potential threat to the stability of the financial sector, the European Parliament has called on the EC to make cybersecurity "the number one priority" in the FinTech Action Plan.
In response, a plan draft identifies three specific moves:
- A public-private workshop to investigate barriers limiting information-sharing on cyberthreats, followed by a look into how these can be fixed.
- A call for the three European supervisory authorities (ESAs) to map, by Q1 2019, the existing supervisory practices across financial sectors around ICT security and governance requirements, and, where appropriate, consider issuing guidelines to improve convergence and enforcement as well as offer any advice to the Commission on legislative changes.
- Ask the ESAs to evaluate, by Q4 2018, the costs and benefits of developing a coherent cyber threat testing framework for significant market participants and infrastructures within the whole EU financial sector.
Elsewhere, the draft action plan calls for the creation of an EU Fintech Lab, where the ESAs and national regulators can engage with fintech firms working in areas such as DLT, cloud tech, AI and APIs, in a "neutral, non-commercial space" during targeted sessions, beginning in the second quarter of the year.
The plan also sees the EC set out proposals for a legal framework for crowdfunding, ask ESAs to set out authorising and licensing approaches for fintech activities, and promises to "assess the applicability" of the current EU regulatory framework to cryptocurrencies and initial coin offerings.
The Commission is also setting up an expert group to review, by Q2 2019, the fitness of the EU financial services regulatory framework for the use of disruptive technologies such as DLT and AI, while work will also be done to address confusion over rules on using cloud service providers.
Concludes the draft: "The goals are twofold: to harness rapid advances in technology to the benefit of the EU economy, industry and citizens and to foster a more competitive and innovative European financial sector."
The plans to reshape the supervisory environment come at a time when banks are becoming more vocal in their calls for tech firms to be subject to FS regulations. With big tech in the US and China increasingly straying into financial services, BBVA executive chairman Francisco González has told the Financial Times that a body such as the G20 needs to take action to "bring order".