In this insight:
A solid answer to increasing complexity and fragmentation of EU’s national markets
What is the European Single Access Point?
Another element of the sustainability data puzzle is falling into place
ESEF and ESAP: Moving towards digitized EU capital markets information
ESAP: Timeline
ESMA is responsible for establishing and operating ESAP
ESAP: Not a challenge, but a solution
The EU is about to create a single access point to public financial and non-financial information about EU companies and EU investment products. Recently, the Regulation (EU) 2023/2859 of the European Parliament and of the Council, establishing the European Single Access Point (ESAP), has been published in the Official Journal of the EU (OJ).
While the ESAP Regulation entered into force on 9 January 2024, the portal’s development will take another few years, with the European Securities and Markets Authority (ESMA) required to establish and operate it by 10 July 2027.
The ‘collection bodies’, such as ESAs, NCAs or officially appointed mechanisms, are mandated to receive information from companies under existing legislation and transmit it to ESAP. Such information will need to be published in a format allowing data extraction and machine readability.
To ensure this, such authorities are currently on track to developing their data pipelines, automating the provision of financial and sustainability-related information for free, user-friendly, centralised and digital access via ESAP.
Interestingly, business registries and intellectual property offices, especially in emerging markets and developing economies within Africa, Asia and the Americas, are now exploring ESAP as an exemplary practice to replicate, evolving into so-called Trusted Data Hubs. Such hubs are becoming the new trend in business, financial and sustainable data storage and processing by respective bodies.
Holding trusted data, and sharing it for vital business, AML/CFT and transparency purposes, business registries are uniquely positioned to boost economic growth, social impact, and inclusion. Understanding this and at the same time being driven by the user-centric approach, they also aim to simplify the lives of their users, providing data credibility as a Trusted Dat Hub and guarding compliance with the companies’ rules.
More about the concept of transforming Business Registries into Trusted Data Hubs we wrote here and presented at the Corporate Registers Forum Conference in Malta here.
For many years, the story of capital markets integration in the EU has been that of two opposing tendencies pulling in different directions.
On the one hand, the escalating complexity and fragmentation of the EU’s national markets have become ingrained in 27 distinct legal systems, each adhering to its unique specificities, incompatibilities, and legacies. On the other hand, the need to realize the full potential of the single market by ensuring the seamless cross-border availability of capital, persists and fuels the demand for elevated levels of market integration.
Europe has missed out on the ability to easily access filings from across the continent in one place – a critical function offered in the US via EDGAR, in Canada via SEDAR and in Japan through EDINET. ESAP steps in to fulfil this role in the EU.
The initiative for ESAP’s impact assessment, conducted by the European Commission with BR-AG’s assistance as an external consultant, serves as evidence. Dive into the full version of the Impact Assessment Report to gain a comprehensive understanding of the context that necessitates ESAP implementation, estimated consequences, expected impacts, and more.
Conducted overall assessment, as well as evidence brought, showed that an EU intervention to reduce fragmentation through a single access point would further contribute to integrating the single market by removing obstacles to the circulation of information within the Union.
The European Single Access Point (ESAP) is part of the European Commission’s plan to create a functioning and integrated single market for capital across the EU by strengthening the EU capital markets, known as the “Capital Markets Union” (CMU).
ESAP will be a centralized ‘data space’ providing free and easy digital access to comprehensive information about EU corporates. It will be a platform on which certain financial and sustainability-related information of EU corporates will be filed in a specific digital format to increase transparency and improve the exchange of information for all market participants, including public and private stakeholders.
ESAP is directed primarily to users such as investors, financial analysts and market intermediaries, e.g. asset managers, advisers or data aggregators. Other types of users — such as civil society, regulators, and other public authorities such as statistical authorities — may also see an interest in accessing information through ESAP.
Moreover, since capital market fund raising is limited for SMEs in particular, the tool has the potential to enable smaller companies and companies in small capital markets to get more exposure to international investors.
Crucially, ESAP imposes no further reporting requirements upon EU companies but will simply provide access to data that businesses have already disclosed in the public domain, in line with relevant directives and regulations.
The ESAP will also provide direct access to information disclosed by existing sustainable finance legislation including the Corporate Sustainability Reporting Directive (CSRD), Sustainable Finance Disclosure Regulation (SFDR), and the EU Taxonomy Regulation.
An initial version of ESAP will go live in summer 2027 and to support the aims of the EU’s Green Deal, ESAP will make corporate sustainability data available as early as possible.
Another notable effort in the transition to digitized EU capital markets involves the adoption of the European Single Electronic Format (ESEF) for financial reporting throughout Europe. This initiative establishes consistency and comparability of reported data and appears to have a significant contributory impact in this direction.
The digitization is in demand and is key to the usefulness and utilization of sustainability information. ESEF is here to ensure the successful, interconnected – and fully digital – implementation of sustainability reporting alongside financial reporting.
In particular, companies are required to publish a “human-readable” and a “machine-readable” report. This report contains XBRL tags in line with ESEF for easy control and automatic comparing of reports between companies.
As planned, the upcoming ESAP, whereby both ESEF and data reported according to the CSRD and the European Sustainability Reporting Standards (ESRS) feeding into the big picture of digitising EU capital markets information, will provide easy access to financial and sustainability information from across the EU in one place.
Once reported in a single electronic format (ESEF), financial statement data of different companies can be better compared, utilized and analysed. At BR-AG, we empower business registers and regulators in the EU who would like to benefit from open data made available through ESEF and analyse it using our dedicated tool – ATOME Forces.
Speak to BR-AG tech experts to see the ATOME Forces in action and discover ways to start using intelligent analytics for deriving actionable insights from ESEF data:
The ESAP platform is expected to be available from summer 2027. It will be gradually phased in to allow for a robust implementation. This phasing-in will ensure that European regulations and directives will enter into the scope of ESAP within a few years, in order of priority:
- 10 July 2025: Member States to make the necessary changes to existing domestic transposing legislation for the Transparency Directive.
- 10 January 2026: Member States to make the necessary changes to existing domestic transposing legislation for the Accounting Directive, Alternative Investment Fund Managers Directive (AIFMD), Audit Directive, Bank Recovery and Resolution Directive (BRRD), Capital Requirements Directive (CRD), Covered Bonds Directive, Financial Conglomerates Directive, Insurance Distribution Directive (IDD), Investment Firms Directive (IFD), IORP Directive, MiFID II, Shareholder Rights Directive, Solvency II Directive, Takeovers Directive and UCITS Directive.
- 10 July 2026: The ESAP framework will incorporate the Prospectus Regulation, Short Selling Regulation, and Transparency Directive. This process will also require providing information to ESMA before the ESAP platform becomes operational.
- 10 July 2027: Deadline for ESMA to establish and operationalise ESAP.
- 10 January 2028: The ESAP framework will incorporate the Accounting Directive, Benchmarks Regulation, Credit Rating Agencies Regulation, EuSEFs Regulation, EuVECA Regulation, Market Abuse Regulation, Pan-European Personal Pension Product Regulation, PRIIPs KID Regulation, Sustainable Finance Disclosures Regulation and UCITS Directive.
- 10 January 2030: The ESAP framework will incorporate the AIFMD, Audit Directive, Audit Regulation, BRRD, CRD, Capital Requirements Regulation, Covered Bonds Directive, ELTIF Regulation, EU Green Bond Standard Regulation, Financial Conglomerates Directive, IDD, IFD, Investment Firms Regulation, IORP Directive, Markets in Crypto-Assets Regulation, MiFID II and MiFIR, Money Market Funds Regulation, Securities Financing Transactions Regulation, Shareholder Rights Directive, Solvency II Directive and Takeovers Directive.
The ESAP platform is expected to be available from the summer 2027. It will be gradually phased in to allow for a robust implementation. This phasing-in will ensure that European regulations and directives will enter into the scope of ESAP within a few years, in order of priority:
- the Accounting Directive,
- Alternative Investment Fund Managers Directive (AIFMD),
- Audit Directive,
- Bank Recovery and Resolution Directive (BRRD),
- Capital Requirements Directive (CRD),
- Covered Bonds Directive,
- Financial Conglomerates Directive,
- Insurance Distribution Directive (IDD),
- Investment Firms Directive (IFD),
- IORP Directive,
- MiFID II,
- Shareholder Rights Directive,
- Solvency II Directive,
- Takeovers Directive and UCITS Directive.
- Accounting Directive,
- Benchmarks Regulation,
- Credit Rating Agencies Regulation,
- EuSEFs Regulation,
- EuVECA Regulation,
- Market Abuse Regulation,
- Pan-European Personal Pension Product Regulation,
- PRIIPs KID Regulation,
- Sustainable Finance Disclosures Regulation and UCITS Directive.
- AIFMD,
- Audit Directive,
- Audit Regulation,
- BRRD,
- CRD,
- Capital Requirements Regulation,
- Covered Bonds Directive,
- ELTIF Regulation,
- EU Green Bond Standard Regulation,
- Financial Conglomerates Directive,
- IDD,
- IFD,
- Investment Firms Regulation,
- IORP Directive,
- Markets in Crypto-Assets Regulation,
- MiFID II and MiFIR,
- Money Market Funds Regulation,
- Securities Financing Transactions Regulation,
- Shareholder Rights Directive,
- Solvency II Directive and Takeovers Directive.
The European Securities and Markets Authority (ESMA) is given the task of establishing and operating ESAP platform which should provide at least the following pack of functionalities:
- A web portal with a user-friendly interface in all the official languages of the Union to provide access to the information in the ESAP
- An application programming interface (API) enabling easy access to the information available in the ESAP
- A search function in all the official languages of the Union
- An information viewer
- A machine translation service for the information retrieved
- A download service, including the download of large quantities of data
- A notification service informing users of any new information available in the ESAP.
A well-functioning and integrated market for capital across the EU requires a high level of transparency and the accessibility. ESAP is coming to offer it in a useful, accessible, free of charge platform that merges digital data crucial for capital markets, financial services, and sustainable finance from across Europe.
While the complete implementation of the ESAP may appear distant, regulatory authorities, NCAs, and business registers are actively gearing up to fully leverage its potential. An important pre-condition for this endeavor involves establishing robust management for structured, digital regulatory models and taxonomies used in reporting.
This is made easier, faster and cost-effective through the utilising of tech tools like our data modelling & taxonomy management solution – ATOME Matter.
Supporting initiatives aimed at the standardization and optimization of financial data reporting under the EU supervisory and regulatory frameworks, we also apply our vast expertise in collaborating with global regulators in their projects aimed at mirroring and replicating the EU experience to establish a single access point to data via the ESAP platform.
If you are also on your journey toward digitizing data for its greater transparency, comparability and accessibility, speak to us to learn more about our practical experience and take a closer look at how our tooling may accelerate your digital transformation: