Looking Ahead: European Developments - Horizon Scanner: Finance, May 2025

The European Commission's Market Integration and Supervision Package represents the most substantial EU capital markets reform since MiFID II, proposing to transfer supervisory powers to ESMA and harmonise fragmented regulatory frameworks across trading, post-trading and asset management.

The EU Retail Investment Strategy is a legislative package which introduces significant changes to the UCITS Directive and AIFMD, as well as MiFID II, the Insurance Distribution Directive and the Solvency II Directive via an omnibus directive (Omnibus Directive).

On 18 September 2026, the European Banking Authority (the EBA) published its final report on the new “Guidelines on the sound management of third-party risk regarding non-ICT services (EBA/GL/2026/09)” (the 2026 Guidelines).

Ireland is home to a wide variety of financial services providers. To support both providers and their customers, there is an array of financial services legislation...

The European Banking Authority has published final Guidelines on the sound management of third-party risk regarding non-ICT services, replacing the 2019 Outsourcing Guidelines and introducing a broader regulatory framework. Financial entities will need to navigate expanded scope requirements, enhanced governance standards, and alignment with DORA while managing compliance timelines and contractual obligations.

Ireland offers a sophisticated regulatory framework for Alternative Investment Funds, with structures ranging from ICAVs and Investment Limited Partnerships to Unit Trusts and Common Contractual Funds. The jurisdiction provides flexible options for both retail and institutional investors, with distinct regulatory pathways for RIAIFs, QIAIFs, and ELTIFs, each designed to accommodate different investment strategies and liquidity profiles while maintaining robust investor protections.

The European Commission's proposed overhaul of the SFDR regime is entering crucial trialogue negotiations, with the Irish Presidency aiming to reach agreement by year-end. While the Council and Parliament have aligned on key issues like professional investor opt-outs, significant divergences remain on exclusion criteria for Transition funds, PAI reporting requirements, and engagement strategy disclosures that will shape the future of sustainable finance regulation.

The Listing Act Directive introduces significant reforms to the MiFID II research regime, allowing investment firms greater flexibility in paying for research and execution services. This briefing examines how the removal of market capitalisation thresholds restores bundling as a commercial option and establishes a new EU framework for issuer-sponsored research.

On 30 October 2025, the Governing Council of the European Central Bank (ECB) announced its decision to move to the next phase of the digital euro project.

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