European Union rules on company financial information need to be updated to apply the lessons of the collapse of German payments firm Wirecard, the bloc's securities watchdog said on Wednesday.
The European Securities and Markets Authority (ESMA) said in a report in November there were deficiencies in how Germany's securities and accounting watchdogs cooperated regarding Wirecard, the country's biggest accounting scandal.
"ESMA considers that the Wirecard case has shown, once again, that timely and effective enforcement of financial information is paramount to ensure investor protection and confidence in capital markets," ESMA Chair Steven Maijoor said in a letter to the EU's financial services chief Mairead McGuinness published on Wednesday.
In the letter, ESMA set out proposed reforms to eliminate the barriers to regulators sharing confidential information about a company, and to clarify which body is responsible for enforcement.
The transparency rules are part of EU law, but their implementation differs among member states because of varying set-ups.
"In some countries there are confidentiality clauses preventing an effective and timely exchange of information," ESMA said.
It also wants rules to allow the exchange of information on a company between accounting, audit, banking and anti-money laundering regulators.
The watchdog also hinted at the need for tough U.S.-style rules that require directors of a company to personally attest to the financial information made public.
ESMA said it backs EU efforts to strengthen the bloc's corporate governance and audit rules, especially by "enhancing the assurance on, and disclosure requirements regarding, effectiveness of issuers' internal controls".
Major changes to EU rules would likely require approval from EU states and the European Parliament.
(Reporting by Huw Jones; editing by Barbara Lewis)