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On the 17th of June 2025, the European Commission (EC) published its proposals for targeted adjustments to the EU Securitisation Regulation (SECR) and to the Capital Requirements Regulation (CRR)[1]. The EC aims to unlock the potential benefits of securitisation for the European economy by addressing existing regulatory challenges as part of the Savings and Investment Union (SIU) strategy. The proposals accomplish these goals in certain areas; however, from an institutional investor perspective – they do not strike the necessary balance, and as a such, they fall short of an essential element for achieving the SIU objectives. 

Objectives of the EC Proposals 
The current regulatory set-up for EU securitisation is overly conservative and complex. As such, it is keeping the European economy from applying the full benefits that securitisation can offer. The EC’s long-awaited review strives to make the EU Securitisation Framework less burdensome and more principles-based, in order to facilitate securitisation activity in Europe. This is a priority for the SIU[2] as the current economic and geopolitical environment requires vast amounts of investment and securitisation can be a crucial tool for increasing the amount of financing available to the real economy. 

Proposed Changes and Their Impact 
The proposed measures bring several positive changes, which are expected to ease the regulatory process for European issuers of, and investors in, securitisation. These include a reduction of fields in the reporting templates, simplification of the due diligence requirements for EU transactions, (overall) lower capital risk-weights and new, principles-based, SRT tests. However, ‘all that glitters is not gold’ and some aspects of these proposals may jeopardise the EC’s core objectives and the success of the review. 

One significant issue is the continued requirement for EU investors to ensure that securitisations issued by non-EU issuers adhere to the SECR, including the detailed disclosure requirements (in the form of templates[3]). This creates a serious competitive disadvantage for EU investors and may, in practice, render third-country securitisations non-investible. Given that EU investors are expected by their own clients and regulators to build a diversified and well-balanced portfolio, this requirement comes as a surprise; even more so because the Commission has recognised this problem in the past and pledged to resolve it. A highly effective solution has already been suggested in the Report of the Joint Committees of ESAs[4], which proposes to strike the link between due diligence and disclosures requirements in the SECR. 

Another alarming proposal is the amendment to Article 32, which introduces administrative sanctions under the SECR for failure to meet the due diligence requirements. This additional measure is entirely unnecessary as EU institutional investors are already regulated and supervised by their national regulators, who have all the tools to impose relevant sanctions. If adopted in its current form, Article 32 will discourage investors, especially first-time investors, from investing the EU securitisation market. 

In a nutshell, the EC’s proposals contain many good amendments, which could potentially open up the market. On the other hand, the EC seems to be compensating for the flexibility it has provided by imposing restrictions on non-EU securitisations and by adding sanctions for investors. This approach does not strike the right balance and is not playing in favour of meeting the objectives of the review of the EU Securitisation Framework. 

Next Steps 

The EU legislative procedure requires the European Commission’s proposals to be accepted by both the European Parliament and the Council. This process typically takes several months, during which the co‑legislators may propose amendments. In December 2025, the Council has formally agreed its position.  On the European Parliament side, both draft Reports (SECR and CRR) have been published as well, and now the ECON committee is expected to vote on its position in May 2026. Once both the Council and the EP have adopted their respective positions, interinstitutional negotiations (trilogues) will begin to reach a final compromise text. The final adoption could occur in the second half of 2026, with application dates possibly set for early 2027. The final shape of the SECR and CRR is therefore still to be determined. Balancing the needs of regulators, issuers, and investors will be crucial for the success of this initiative. 

For more commentary about the proposed reform to the EU Securitisation Framework, please see our series of blogs “ Building a Bridge to Europe’s Financial Stability”

[1] Commission proposes measures to revive the EU securitisation framework - European Commission 
[2] Savings and investments union - European Commission 
[3] pggm-paper-esma-templates-not-fit-for-risk-sharing-transactions-november-2019.pdf 
[4] JC 2025 14 Joint Committee report on the functioning of the securitisation regulation