Local view for "http://purl.org/linkedpolitics/eu/plenary/2001-04-02-Speech-1-033"
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"en.20010402.4.1-033"2
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".
Commissioner, ladies and gentlemen, the report which I have the honour of presenting to the House concerns the Commission communication to the Council and the European Parliament on upgrading the 1993 directive on investment services.
The Commission has notified this communication within the context of the wider action plan for financial services drawn up in application of the decisions by the European Council in Lisbon on the unification of the European financial and capital markets. Unifying these markets will help to complete the single market. Τhe last European Council in Stockholm revisited this issue, calling for the action plan to be fully applied by 2005 and for all interested parties to make every effort to achieve a single stock market by the end of 2003. Investment services are, without doubt, an important tool, perhaps the most important tool to the working of the stock markets.
Clearly, every initiative in this context, such as that contained in the Commission communication which it is my honour to present to the House, has been stamped urgent by the European Council. The Commission communication is not a legislative text. However, it is, nonetheless, of crucial importance because it paves the way for the reforms needed so that, when the time comes for a legislative proposal, and I believe it will be soon, Parliament will be prepared to adopt the necessary amendments to the original directive quickly and, I trust, almost unanimously. I think that this will give us a chance to prove the speed and efficiency of our legislative procedure which, unfortunately, has been thrown into doubt recently by certain reports, such as the Lamfalussy report.
My fellow Members, the economic policy objective of the Group of the Party of European Socialists is not, nor has it ever been, purely and simply to distribute income and wealth more fairly and reduce inequalities in society. Along with this objective, which forms the nucleus of our policy, we have always endeavoured, and we still do, to strengthen the productive base, because goods need to be produced before they can be distributed more fairly. With these thoughts in mind, the Socialist Group firmly supports the completion of the single market and the unification of the financial markets in Europe. We believe that progress on these fronts will strengthen the productive potential of the European economy, to the benefit of one and all. We also believe that the market cannot use its autonomous and automatic procedures to create the changes needed for the purpose. Self-perpetuating change in market institutions often traps the economy in an unproductive situation, creating monopolies and safeguarding the interests of the few at the expense of society as a whole. Political intervention is therefore required in order to shape the frameworks needed within the economy, so that the market can be liberalised and can return a real productive result.
It is exactly this sort of reforming intervention which I have the honour of recommending in this report on upgrading the directive in question. The original directive, in 1993, was intended to promote the unification of the markets and fight national protectionism in the provision of investment services. The mainstay of the directive was the mutual recognition by all the Member States of the operating licences which any one Member State issued to investment service companies, the famous European passport. The idea was an inspired one, but it was thwarted in practice by the fact that each Member State had the facility to attach different operating rules to the provision of these services. The fact that, under the original directive, the investment company no longer needed to file 15 applications and obtain 15 licences, but only needed one licence in order to establish anywhere in Europe was, without doubt, a step forward, but it lost much of its impetus because each company had to deal with 15 different legislative regimes on the ground. This situation acted as an important national regulatory barrier to the unimpeded movement of investment services and the unification of the European markets.
I now recommend to you, and I am delighted that the spokesman of the Group of the European People’s Party (Christian Democrats) and European Democrats, Mrs Kauppi, agrees with this proposal, that we dismantle this barrier and impose the force, not of 15, but of a single regulatory regime, namely that of the Member State which issues the licence. We shall have taken a big step towards the single market once certain aspects of the investment services sector are unified, especially once clearing and settlement of share purchases and sales have been unified.
In the United States, which can teach us a great deal about these matters, one central clearing house acts for the whole country. In Europe we have many more than one. Given that clearing services have huge potential for economies of scale and hence for reducing costs, which are much higher for us than in the USA, it would be a good thing if the directive helped to unify these functions. It cannot, of course, insist that the stock exchanges merge, but what we can do, and what I suggest to you, is that contracting parties should have the right to choose the clearing and settlement system which they prefer, even if it is different from that of the stock exchange on which the transaction was conducted. By strengthening competition as part of the procedure of stock exchange mergers being promoted by the euro, there is hope that, in the end, the companies with the lowest costs will prevail, rather than the companies with the strongest monopolistic links.
Furthermore, the directive should monitor the constant changes being driven by technological progress. Today, the regulated markets are no longer infrastructure-type organisations; they have become commercial companies, while numerous large, highly computerised stock exchange companies have metamorphosed from intermediaries on the market into internal share markets. The regulations need to be adjusted accordingly. Many of the rules on the integrity of the markets, such as rules to combat insider trading, need to be extended to the internal transactions of these companies, while other rules, which at one time only related to companies, such as rules governing customer relations, should also apply to stock exchanges. This question is difficult to broach, but it is, perhaps, one of the questions which we should regulate in general terms, leaving the details of application to the regulatory authorities of each country or of Europe, where there are any.
Finally, ladies and gentlemen, I should like to stress that the Socialist Group supports the unification of the financial markets, the aim of which is to strengthen the investments needed to achieve full employment in Europe. It certainly does not support, in fact it is most certainly opposed to, the speculative fever of stock exchanges, which can cause catastrophic, explosive conditions in the real economy, which is why we are calling on the Commission to present its proposal on safeguarding the integrity of the markets as quickly as possible. Of course, we do delude ourselves that a regulation will do away with speculation at a single blow. However, we do at least want stronger principles of commercial honesty, precisely because speculation increases the temptation to act dishonestly, now that the stock exchanges are increasingly consolidating their pension function in our society. The limits within which European stock exchanges are fed from workers’ pension funds cannot but be much stricter than in the days when stock exchanges were simply casinos for the rich. Strengthening discipline and the proper functioning of the stock exchanges are one of the most important projects in the action plan for the investment markets."@en1
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