Financial Stability
European Commission’s 2027 Work Programme: banking competitiveness and simplification take centre stage
Published on 05 November 2026
The European Commission’s 2027 Work Programme puts competitiveness, regulatory simplification and the removal of Single Market barriers at the heart of its agenda. For banks, the year ahead will bring a new competitiveness package alongside further work on market integration, investment and sustainable finance.
For Luxembourg’s banking sector, the direction is encouraging: several initiatives address concerns long raised by the ABBL and its partner associations. The key test, however, will be whether these political ambitions translate into less regulatory complexity and fewer barriers to doing business across the Single Market.
By Antonio Garzon-Amadei, ABBL, ALFI & ACA European Affairs, and Antoine Kremer, ABBL, ALFI & ACA Head of European Affairs
Summary
The European Commission has unveiled its 2027 Work Programme, setting out another busy year for EU financial services policy.
Competitiveness and simplification feature prominently, alongside initiatives intended to deepen the Single Market and advance the Savings and Investments Union.
For the ABBL, several of the announcements create opportunities to advance long-standing priorities for Luxembourg’s banking sector: more proportionate regulation, fewer unnecessary barriers and a more integrated European financial market.
Bank competitiveness package expected in early 2027
The most significant new initiative for the banking sector will be the Bank Competitiveness and Simplification Package, scheduled for the first quarter of 2027.
The package is expected to address regulatory complexity, strengthen the competitiveness of European banks and contribute to completing the Banking Union.
The European Deposit Insurance Scheme (EDIS), which has long been stalled as a standalone proposal, is also expected to be revisited as part of the package.
For the ABBL, this initiative offers an important opportunity to push for more proportionate regulation, particularly for small and non-complex banks, while addressing persistent fragmentation within the European banking market.
Savings and Investments Union remains a priority
The Commission will continue advancing its Savings and Investments Union (SIU) agenda, including through reforms to the venture capital framework and a mid-term review of the SIU strategy.
At the same time, several major legislative files are already progressing through the EU institutions.
These include the Market Integration and Supervision Package (MISP), the supplementary pensions package covering the IORP framework and the Pan-European Personal Pension Product (PEPP), as well as the review of the Sustainable Finance Disclosure Regulation (SFDR).
These initiatives will have important implications for Luxembourg’s investment fund industry and for banks active in investment services, including depositary banking and wealth management.
Commission plans to withdraw FIDA proposal
One particularly notable announcement is the Commission’s intention to withdraw the Financial Data Access (FIDA) proposal within six months.
The proposal would have introduced a far-reaching framework for sharing financial customer data and has faced considerable criticism over its complexity, implementation costs and uncertain benefits.
Its planned withdrawal would remove a potentially significant regulatory burden for banks and insurers.
Tackling Single Market barriers and gold-plating
The Commission also intends to step up efforts to remove barriers within the Single Market.
A Single Market Barriers Prevention Package is scheduled for the third quarter of 2027.
In parallel, a new Pact Against Gold-Plating would require Member States to be more transparent about additional national requirements introduced when transposing EU directives. It would also introduce a mechanism to review and remove unnecessary requirements in the context of the European Semester.
These initiatives are particularly relevant for ABBL members whose business models rely on providing services across borders.
The announcements are encouraging and reflect concerns that the ABBL and its partner associations have consistently raised with the Commission, including through the notification of Single Market barriers to DG FISMA.
Much will nevertheless depend on whether the proposed measures translate into effective action against existing national barriers.
Tax simplification
On taxation, the Commission intends to withdraw the proposed Business in Europe Framework for Income Taxation (BEFIT) directive, alongside the longstanding proposal on the corporate taxation of a significant digital presence.
This is another indication of the Commission’s wider focus on simplification and the reassessment of legislative initiatives that have struggled to progress.
A decisive year ahead
The 2027 Work Programme confirms that competitiveness and simplification have become central objectives of EU financial services policy.
The key question will now be whether these political ambitions translate into tangible reductions in regulatory complexity and meaningful progress towards a more integrated Single Market.
The ABBL will closely follow these initiatives and engage with EU policymakers to ensure that the perspectives of Luxembourg’s banking sector are reflected in the forthcoming proposals and legislative negotiations.
By Antonio Garzon-Amadei, ABBL, ALFI & ACA European Affairs, and Antoine Kremer, ABBL, ALFI & ACA Head of European Affairs
Antoine Kremer
Head of European Affairs at the ABBL, ALFI and ACA
Published on 05 November 2026