Transcript MiFID A Brussels perspective

An update on EU Financial Services and associated initiatives
A Brussels perspective
Dr. David P. Doyle
EU Policy Adviser – Financial Services Regulation
November 2011
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Building constructive links at Pan-EU level
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European Parliament
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European Council
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European Commission
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UEAPME – leading EU SME representative body
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Cross-party MEP groups (Kangaroo Group, SME-UNION, Enterprise First Europe…)
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Pan-EU trade and industry bodies:
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EuroChambers – European chambers of commerce
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BusinessEurope – EU employers Federation
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EU Banking Federation
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Conference Board Europe
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ESC – European Economic and Social Committee
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ETUC – European Trade Union Council
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Permanent Representations of each EU state to the EU (diplomatic missions)
Guiding principles
Competence
Any action must remain within the scope of the Treaty
Subsidiarity
Action should be taken by the body best placed to act, i.e., does action at community level
provide added value?
Proportionality
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Action should be proportionate
European parliament
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736 MEPs – elected for five years
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Meets in Strasbourg and Brussels
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Previously, powers vary according to treaty provisions, but increasingly assertive on all EU legislation
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Significant new powers under the Lisbon Treaty
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Joint-powers to pass legislation (with EU Council)
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Operates on basis of 20 thematic committees:
–Two
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Chairman
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Vice chairmen x 3
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Political group co-ordinators
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Rapporteurs and shadows
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EU state holding EU Presidency
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Political group secretariat
important committees:
Economics and Monetary
Committee
Legal Affairs Committee
Composition of the MEPs
736 MEPs
Members
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EPP (265)
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S&D (184)
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ALDE (84)
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Greens (55)
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ECR (54)
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EUL-NGL (35)
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EFD (32)
Political
groups
Big decision
makers
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Germany 99
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France 72
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Italy 72
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United Kingdom 72
European commission
–What
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is it?
27 Commissioners, 1 from each Member State.
Appointed not elected.
One for each EU State.
Commissioners collectively known as ‘College’,
head by President (Barroso).
10,000 EC officials.
Divided in Directorates (roughly equivalent to
ministries).
–What
does it do?
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Sole right of initiative to propose leg
– Power to make Secondary legislatio
– Responsible for day-to-day running
institution (Chairs Management and
Regulatory Committees, i.e., Comm
Audit Regulation).
– ‘Guardian’ of the Treaties.
The
influential Directorates: Trade, Internal Ma
Economics & Monetary Affairs, Enterprise.
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Council of ministers
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• Ministers and Commissioners –
political forum
• Adopts legislation (with EP)
• Various Council formats (i.e., Health,
Environment)
• Chaired by country running the EU
Presidency
• Ministerial meetings held in Brussels
and Luxembourg
• Supported by Secretariat
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A charged EU Agenda since the financial crisis
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Regulate both capital markets and market actors
38 separate pieces of draft legislation
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Filling-in the gaps where European or national regulation is
insufficient or incomplete
Expansion of scope of regulation: all financial institutions,
intermediaries (transactional and advisory actors) and financial
instruments.
More focus on Pan-EU centralised authorisation and supervision,
with “implementing powers” vested in 3 authorities: ESMA, EBA &
EIOPA
Less directives and more regulations – assures faster
implementation and less scope for gold plating and divergent
interpretation
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Stronger powers for EU Commission (“delegated powers”)
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Stronger powers for EU Parliament (Lisbon Treaty): life-cycle
review and approval of draft legislation
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Built-in “sun-set clauses” to review EU laws after 3-5 years
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Brussels: Perception persists that the financial crisis is not over
and that debt financing for the SME sector is dwindling
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Remuneration and bonuses
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Pan-EU Supervisory Mechanisms
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Hedge Funds & Private Equity
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OTC Derivatives, Short-selling
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Solvency II – Insurance
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Responsible Lending & Borrowing
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Packaged Retail Investment Products (PRIPs)
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MiFID II
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UCITs IV
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Capital Requirements Directive IV
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Credit Rating Agencies
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Market Abuse updated rules
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Financial Transactions Tax (FTT)
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Living wills for banks
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Pensions
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Corporate governance in financial institutions & listed companies
The EU legislative response to the financial crisis
Objectives
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All that is of systemic importance should be regulated and supervised.
Need for better capitalised finance industry, with less leverage.
Perverse incentives in the financial sector should be tackled.
Supervision should have the right tools to grasp complex, inter-connected and globa
financial nature of activities.
Restore trust, investors and consumers should benefit from clearer, more coherent
effective safeguards.
EC approach to improving corporate governance in small and nonlisted companies
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Should EU corporate governance measures take into account the size of listed
companies? How?
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Should a differentiated and proportionate regime for small and
medium-sized listed companies be established? If so, are there any appropriate
definitions or thresholds? Can these be adapted for SMEs?
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Should any corporate governance measures be taken at EU level for unlisted
companies?
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Should the EU focus on promoting development and application of voluntary
codes for non-listed companies?
Agenda in the retail investment space
Markets
in
Agenda
Financial
Instruments
Directive
in
the retail
investment
space(MiFID)
Insurance
Mediation Directive (IMD)
Packaged Retail Investment Products (PRIPS)
Reform of the EU Pensions Regime
Reform of corporate governance policies within financial institution
“European consumers deserve better. They need reassurance that their savings,
investments or insurance policies are protected no matter where in Europe they are
based” (Commissioner Barnier, 2010).
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The SME Agenda
Small Business Act launched in 2008 - proposing a wide ranging set of
pro-enterprise measures designed to facilitate the business operations
for SMEs:
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Access to Venture Capital
A light touch financial reporting regime Micro-enterprises
A Directive on e-invoicing, particularly helpful to small businesses, by making einvoices equal to paper ones.
Empowering Public authorities to be required to pay within 30 days as a
security guarantee for SMEs.
Exploring options for setting up an intellectual property rights instrument at
the European level, in particular, to ease SMEs' access to the knowledge
market
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The SME Agenda - Other initiatives
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Legislative proposal for a Common Consolidated Corporate Tax Base (CCCTB) propose a new VAT
strategy aiming notably at reducing tax obstacles and administrative burdens for SMEs in the Single
Market
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Facilitate cross-border debt recovery
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Propose an instrument of European Contract Law
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Undertake a revision of the European standardisation system in 2011 to ensure, that it addresses to the
needs of SMEs
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Explain the rules on labelling of origin and inform SMEs about the means available to them to protect
their legitimate interests.
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Create mentoring schemes for female entrepreneurs in at least 10 EU countries to provide advice and
support with the start up, functioning and growth of their enterprises
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Reduce the time needed to get licences and permits (including environmental permits) to 1 month by
the end of 2013
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Promote second chances for entrepreneurs by limiting the discharge time and debt settlement for an
honest entrepreneur after bankruptcy to a maximum of three years by 2013
Contact
Dr.
David P. Doyle
EU Policy Adviser – Financial Services
Email: [email protected]
Tel: +33-628-69-40-40
Fax: +33-957755844
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