* Maijoor says shortselling can be beneficial to markets
* No clear evidence of abusive behaviour in bond markets
BRUSSELS, Feb 1 (Reuters) - Shortselling shares is not always bad for markets and financial products and practices should only be banned in exceptional circumstances, a top European Union regulator said on Tuesday.
"I am not a banner. This will be an activity which is exceptional. You want to rely on markets for choice and innovation," said Steven Maijoor, the Dutch regulator selected to head the EU's European Securities and Markets Authority (ESMA) that was launched last month.
"Shortselling in itself is not a negative thing. It results in liquidity," Maijoor told a confirmation hearing in the European Parliament.
The EU is approving a law giving ESMA powers to intervene in markets to ban products or practices such as abusive shortselling of shares, or betting their prices will fall.
It also covers the equivalent of shortselling in government bonds -- the "naked" selling of sovereign credit default swaps (CDS), a derivative contract linked to government debt.
Policymakers blamed naked selling, where the buyer does not hold the underlying government bonds, for stoking the euro zone government debt problems which sparked a bailout of Greece.
Maijoor said the evidence so far was mixed on whether shortselling-type activities were a problem.
NEED FOR CONSISTENCY
"The issue to what extent there has been manipulation, there has not been a clear answer yet," Maijoor said, noting some of the recent problems were related to fundamental issues in government finances.
ESMA will have powers to approve standards that are binding on the bloc's 27 countries, including major financial centres such as London.
Maijoor said it was important ESMA was consistent in the way it dealt with shortselling curbs across the EU.
Cross-border investors face a patchwork of shortselling curbs that were introduced unilaterally by national supervisors as the financial crisis unfolded.
He also said ESMA will look at whether it should copy British plans to ban commissions tied to products sold by financial advisers in favour of a transparent customer fee.
"We know that part of misselling, the fact the consumer ended up with the wrong products, can be linked to the way payment and compensation takes place for those actually working in the financial sector," Maijoor said.
"I think ESMA should focus on that above all and on the question as to the role of financial advisors and whether that can provide incentives which rather distort a fair market in the financial sector. That is going to be my focus for ESMA when it comes to remuneration."
ESMA replaces a more collegiate committee of national supervisors in what Maijoor said is a step change that will crack down on regulatory competition among EU states.
A core task this year will be a sweeping revamp of securities trading rules that will extend to commodities, bonds and other assets.
One of the most important issues will be a consolidated tape of all the share prices traded on competing exchanges and platforms to end price fragmentation, Maijoor said. (Writing by Huw Jones; Editing by David Holmes)