Sven Giegold

Cum-ex report: EBA lacks key answers. European dimension of cum-ex remains unresolved

Yesterday the European Banking Authority (EBA) presented its report on cum-ex and other dividend arbitrage transactions. This report is the EBA’s response after 18 months of a mandate from the European Parliament in the form of a resolution in November 2018 to review actors, the magnitude of the schemes and possible national and European breaches of law. In its report, EBA does not respond specifically to the Parliament’s questions. The EBA’s survey of national supervisors suggests that little has been done at national level to shed light on dividend arbitrage schemes. In addition to the report, the EBA has presented a 10-point action plan. The only forceful point of this plan is the planned opening of a formal inquiry into cum-ex, although unfortunately no target date is given. While ESMA has already opened the formal inquiry, EBA has refused this step for one and a half years. The other nine points of the action plan, however, will most likely not lead to any further answers to the questions of the European Parliament.


MEP Sven Giegold, financial and economic policy spokesperson of the Greens/EFA group commented:


“The EBA report on dividend arbitrage schemes is nothing but embarrassing. A year and a half after the European Parliament’s request for a cum-ex investigation, the European Banking Authority is delivering only half-baked results. The EBA does not respond in the slightest to Parliament’s questions. Actors, magnitude of schemes and breaches of law remain in the dark. The EBA’s 10-point action plan on cum-ex also offers little hope. The only strong point is the opening of a formal inquiry as requested by the Parliament, but for which EBA has not set a target date.


National money laundering and financial supervisors have also failed on dividend arbitrage schemes. Hardly any information has been exchanged, neither between national financial and tax authorities, nor between authorities in Europe across borders. The largest tax scandal in Europe with a cross-border dimension remains largely unresolved. The patchwork of national supervisors together with a weak European Banking Authority is dysfunctional.


In view of the failure to clear up the dividend arbitrage scandal, an upgrade of the EBA to a European money laundering supervisor has become unthinkable. The EBA needs a complete overhaul of its decision-making structures. I will also raise the poor quality of this report in the European Parliament. The EBA will be the first to receive a long list of questions from me. This must not be shelved now. It is now up to the market and securities supervisor ESMA to actually clear up dividend arbitrage deals. ESMA’s final report is still pending.”


Link to EBA-communication on cum-ex report :


Link to the 10-point plan by EBA: Download here


From the resolution of the European Parliament: 

“Requests the European Securities and Markets Authority and the European Banking Authority to conduct an inquiry into dividend arbitrage trading schemes such as cum-ex or cum-cum in order to assess potential threats to the integrity of financial markets and to national budgets; to establish the nature and magnitude of actors in these schemes; to assess whether there were breaches of either national or Union law; to assess the actions taken by financial supervisors in Member States; and to make appropriate recommendations for reform and for action to the competent authorities concerned;”

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