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The European Commission is preparing a proposal to expand central supervision over Europe’s key financial markets, including stock exchanges, clearing houses, and crypto exchanges. The initiative, expected to form part of December’s “Markets Integration Package,” aims to reinforce Europe’s competitiveness and reduce fragmentation across its capital markets.

Europe’s markets are often described as fragmented, with many national regulators and hundreds of trading and post-trading entities. A single EU supervisor, similar to the U.S. Securities and Exchange Commission (SEC), seems the solution to bring more uniformity and global weight.

However, Europe already has national regulators that deliver consistent and effective results. The CSSF in Luxembourg, for instance, has long been recognized for its balanced, pragmatic approach and its ability to combine investor protection with market competitiveness. It is a model that works, not only for Luxembourg but for Europe as a whole.

That is why the real question is not whether Europe should integrate its markets (everyone agrees it should) but how that integration happens. Should Europe build on what already works, like the proven competence and international credibility of national authorities such as the CSSF, or replace them with a distant and costly centralized structure that risks diluting both accountability and expertise?