The European Commission is to reveal ambitious new plans aimed at liberalizing the EU's financial services market, the Financial Times has reported. The proposed changes would make it easier for investment companies to operate across Europe, and allowing banks to compete with stock exchanges for parts of their business.

The reported proposals, one aspect of the markets in financial instruments (or MIFID) directive, will offer investment companies the ability to operate freely across the 25 member states of the EU, supervised solely by the regulatory body of their home country. Additionally, the directives will also bring banks into direct competition with regulated stock exchanges for specific elements of business.

Details of the directive have met with unease in some quarters, especially from banks which are concerned new laws will bring heavy compliance costs without tangible benefits.