Local view for "http://purl.org/linkedpolitics/eu/plenary/2002-11-20-Speech-3-279"
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"en.20021120.8.3-279"2
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"Mr President, Commissioner, ladies and gentlemen, it is a great pleasure for me to have this chance to discuss the expansion of the Lamfalussy procedure to include all financial services. I greatly appreciate being given the opportunity to give an account of the Council’s proposal to the European Parliament so that we can have a constructive and open dialogue between the Council and the European Parliament on this important subject.
Initiatives for new directives such as the implementation of capital adequacy rules in the area of banking and the Solvency II rules in the area of insurance will require certain detailed technical regulations and it is therefore appropriate to apply a more effective legislative procedure in this area, such as that used in the securities market. The new structure also paves the way for drawing a better distinction between the heart of the matter, that is to say, what is politically central, and what can be left to implementing decisions that can be adjusted on an ongoing basis in line with changing market conditions.
Although the Commission is not expected to produce its proposal on Basle II until spring 2004, it would nonetheless be useful for the new structure to be in place at an early stage.
Thirdly, the new structure is necessary in order to secure efficiency in connection with the EU’s forthcoming enlargement. The new structure will be more serviceable and effective in an EU with 25 Member States. The Banking Advisory Committee, which currently carries out both level 2 and 3 tasks, has 3 members from each state (that is, one from the ministry, one from the supervisory authority and one from the central bank). Following enlargement it will have 75 members, plus a number of observers.
Harmonisation and convergence of European supervisory practice can best be promoted by establishing a uniform structure for all sectors. The structure from the securities market provides a suitable model here. The new supervisory structure will ensure that organisation of the exercise of supervision remains a national task and will create a more transparent committee structure without mixed mandates as is the case at present in the banking and insurance sectors. It creates a permanent and clear structure for cooperation across the various supervisory committees as well as for the relationship between supervisory committees and the ‘level 2’ committees. It thus establishes good cooperation on supervision across the sectors and creates a good and clear distribution of responsibility.
In summary, therefore, we can state the following concerning the significance of the new structure:
There will be a greater degree of focus on political issues – and thus on the overall principles of the rules.
The political and technical discussions will initially take place in separate fora, allowing the process to take place more quickly because work can be carried on at a technical level in parallel.
Greater openness and commitment will be created in respect of the financial sectors in many countries and the implementation of the rules contained in the individual directives in the individual states will be more uniform, creating a basis for more uniform supervision.
And finally, it will create a greater correlation between the rules in the individual parts of the financial sector.
It is necessary to find a good structure for the role of the European Parliament in connection with the devising of overall policy guidelines for the financial sphere and I am convinced that this will be possible. As a starting point, I imagine regular meetings between the chairman of the restructured FSPG, the Commission and the European Parliament in order to strengthen the dialogue on the main policy guidelines for financial services. However, a rejuvenation of the 2005 Group is also feasible if this is preferable; this is, after all, mentioned in the European Parliament’s decision on this issue.
The European Parliament’s Committee on Economic and Monetary Affairs has raised some issues concerning the restructured FSPG and the European Parliament’s participation in the discussions on policy in the financial sector. I hope that these issues can be resolved before the report is adopted by the Ecofin Council on 3 December.
With regard to the restructured FSPG and its role in the devising of policy in the financial sphere we would take into account the European Parliament’s concerns. The role of the restructured FSPG is not to be described as ‘devising of policy in the financial sphere’ (‘policy shaping’) as is stated in the text. Rather, the restructured FSPG would provide an overview and advise the Council and the Commission. This will be shown in the final report which is to be adopted on 3 December.
The Council notes that if the new structure is to be able to take effect the European Parliament considers it essential that the legislative system in the EU is altered such that a clear distinction is made between primary and secondary legal acts and that there are the necessary revocation clauses.
The Council is aware that the Commission intends to propose to the Convention that Article 202 of the Treaty be amended so as to reflect the powers of the legislative institutions – the European Parliament and the Council.
As is well known, the Council cannot, as an institution, make decisions that impose obligations on the Convention or the forthcoming Intergovernmental Conference. That is solely a matter for the Member States, which will define their own positions in the Convention and at the Intergovernmental Conference. As president of the Ecofin Council I can assure you that I both can and will encourage my colleagues to make their Heads of State and Government aware of the importance of this topic and at the same time call upon them to deliberate and discuss this issue during their preparations for the Intergovernmental Conference. We in the Council are aware that the role of the European Parliament must be respected.
It is very important that the Convention and the Intergovernmental Conference give consideration to a legislative system that allows greater efficiency in the legislative process and respects the principle of subsidiarity and the powers of the institutions involved.
It is essential that a solution is found in respect of both the challenges faced by the financial sectors and the challenges faced by the Community as a whole.
We must all be aware, however, that this is a broad issue which does not solely concern financial legislation.
In conclusion, I would like to express my hope that the European Parliament’s final position on this issue will take account of the actual opportunities open to the Council and the assurance of goodwill that I have given the European Parliament today.
The financial markets are playing an increasingly great role in Europe’s economy.
They are an important factor in the creation of growth and employment, and financial integration in the EU and the realisation of a single market for financial services will make a substantial contribution to increased prosperity. A report published last week by the Commission shows that full financial integration in the EU will in the long term increase the EU’s GNP by 1.1%.
Increased financial integration, however, also creates a need for improved cooperation on financial supervision in the EU and greater vigilance as regards financial stability. The development of the financial markets in recent years has underlined these needs.
The Ecofin Council therefore wishes to extend the structure for financial legislation, supervision and stability in the securities market on which the European Parliament, the Council and the Commission agreed in February this year to cover all financial services. The interinstitutional agreements that were entered into in connection with the securities markets will naturally also apply in the extended structure. And the monitoring of financial stability in the EU will be similarly strengthened.
For several reasons it is important and imperative that this new structure be extended to include the banking and insurance sectors:
Firstly, the new structure will contribute to financial stability and effective harmonisation of financial regulation by creating a framework for effective cooperation and convergence between the financial supervisory authorities. The increasing integration and reciprocal influence of the financial markets in the EU makes this a necessity which must not be postponed.
Secondly, the circumstances which gave rise to the introduction of the Lamfalussy procedure in the securities sector are also present in the banking and insurance sectors. The way in which rules are formed at present is inflexible, slow and ponderous – and I am fully aware that the Council can also be a delaying factor in the present process. The common rules are also implemented differently in the various Member States. The financial sector as a whole is developing fast, and rapid and effective cooperation on legislation and supervision is just as necessary for the other sectors as was the case for the securities markets. There is a need to be able to react faster than the current structure allows."@en1
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