Generally, we are comfortable with the fair value measurement process for liquid trading instruments that financial institutions have had significant experience in valuing. However, we believe that for less-liquid assets and liabilities, reliability is a significant concern. Management bias The fact that management uses significant judgment in the valuation process, particularly for level-3 estimates, adds to our concerns about reliability.
For example, withholding tax and relief collection procedures for intermediated securities held by non-resident investors remain diverse and fragmented, although the Commission has issued a recommendation to simplify procedures in these areas. Further tax regime integration at the EU level is therefore a key part of further capital market integration.