TheEuropean System of Financial Supervision (ESFS) is the framework for financial supervision in theEuropean Union that has been in operation since 2011. The system consists of theEuropean Supervisory Authorities (ESAs), theEuropean Systemic Risk Board, the Joint Committee of the European Supervisory Authorities, and the national supervisory authorities of EU member states.[1] It was proposed by theEuropean Commission in 2009 in response to the2008 financial crisis.
There are three ESAs. They are responsible formicroprudential oversight at the European Union level:[2]
To complement these authorities, theEuropean Systemic Risk Board (ESRB) is responsible formacroprudential oversight across the European Union. It includes representatives from theEuropean Central Bank (ECB), national central banks and supervisory authorities of EU member states, and theEuropean Commission. The ESRB is based at the ECB in Frankfurt.[3]
TheEuropean Parliament, in September 2010, backed a deal to set up the European System of Financial Supervision replacing the Committees of Supervisors. The deal set up the EBA in London, ESMA in Paris and EIOPA in Frankfurt, after an initial agreement reached between the European Commission and member states in December 2009 had triggered parliamentary criticisms. The three institutions began operations on 1 January 2011 and replaced the Committees of Supervisors.[4]