The Portuguese Securities Market Commission (CMVM) welcomes the report “OECD Capital Markets Review of Portugal 2020: Mobilising Portuguese Capital Markets for Investment and Growth” published today by the Organisation for Economic Cooperation and Development (OECD) and presented in Lisbon, in a session at the Ministry of Finance, with the participation of the Government, the OECD, the European Commission, the CMVM and representatives of the private sector.
Capital markets can and should play a central role in the recapitalisation of companies, by efficiently channelling resources and identifying valid economic recovery opportunities, while offering families the possibility to benefit from the economic recovery and the potential return from allocating their savings to market instruments. The OECD study, which concludes with a set of recommendations intended for the Portuguese capital markets, constitutes a valuable contribution to market dynamism, a purpose reinforced by the current pandemic context, in addition to extending opportunities for investors.
Concerning the report and its recommendations, the CMVM Chair, Gabriela Figueiredo Dias, stated: “Financing the economy is the fundamental economic challenge that Portugal will face in the coming years. Families and businesses can greatly benefit from an increased impetus in the capital markets. The proposed recommendations are an invitation for the private and public sectors to become more involved and focused on the development of an efficient and dynamic capital market. Portugal should accept the invitation.”
With the support of the Portuguese Government, the OECD analysis and recommendations are the result of a CMVM initiative launched in 2018, aimed at providing Portugal with an additional diagnostic tool addressing obstacles and opportunities to stimulate the capital market as an alternative financing source for companies and the economy. It also provides proposals to contribute to implementing public policies.
The project was financed by the European Union through the Structural Reform Support Programme (SRSP) and implemented by the OECD, in cooperation with the European Commission’s Directorate-General for Structural Reform Support (DG REFORM). In addition to the ongoing support of the CMVM, the work carried out since 2018 benefited from contributions from a wide range of listed and unlisted companies, market operators, associations representing market participants, other supervisors and Government representatives.
The CMVM welcomes the result released today, particularly the in-depth analysis of the domestic landscape and the ambition of the recommendations. Several of the proposed recommendations relate directly to the scope of the CMVM’s duties.
In this regard, it is worth noting:
• The recommendation for revising the Securities Code which, on several fronts, meets the revision proposal already submitted by the CMVM and under analysis by the Ministry of Finance, which promotes regulatory simplification, predictability in the performance of the regulatory entity and greater regulatory flexibility, while constantly safeguarding investor protection and market integrity.
• The revision of the legal and regulatory regime that frames market functioning, which is already under study and being prepared, as is the case with a project for a comprehensive review of the legal regime for investment funds and venture capital (asset management).
• Several initiatives to stimulate a capital markets ecosystem in Portugal, based on the interactions that can be created between the companies, namely SMEs, and in its relationship with the capital markets, including more effective and comprehensive alternatives of the current financial research activities and the creation of incentives for greater participation by retail and professional investors in the capital markets, namely through policies and instruments capable of responding to the needs and requests of investors.
It should be noted that the recommendations address a wide range of entities and call for a joint and coordinated effort, where regulation and supervision play a relevant, albeit not a key role.
Thus, in conjunction with the other market participants, the CMVM will continue to work on the development of the Portuguese capital markets, selecting priorities and adopting tangible measures, including implementing these recommendations and maintaining proximity with all parties involved and raising awareness of the opportunities offered by the capital markets.
The strategic guidelines of the CMVM for 2017-2021 selected competitiveness and efficiency of the capital markets as one of the main objectives of its regulation and supervisory activity, for supporting sustained growth of the real economy and to generate varied investment opportunities for families and investors in general.