European Commission

European Commission Consults on Effectiveness of DMD

 

The European Commission has launched a consultation relating to its evaluation of the Distance Marketing of Financial Services Directive (2002/65/EC) (DMD).

The DMD provides details on the information that a consumer should receive about a financial service and the financial services provider before concluding a distance contract. Among other things, it also gives consumers a 14-day withdrawal period for certain financial services contracts, and bans services and communications from suppliers that a consumer has not solicited or consented to.

The European Commission published a new webpage announcing a consultation relating to its evaluation of the Distance Marketing of Financial Services Directive (2002/65/EC) (DMD). The Commission explains that, since the DMD came into force, the retail financial sector has gone increasingly digital, with new products and actors available on the market, and new sales channels being used. Also, several EU laws relating to financial services have been adopted or updated. As a result, the Commission has launched an evaluation of the DMD to assess whether it is still fit for purpose.

The aim of the consultation is to ensure that all relevant stakeholders have the opportunity to express their views on the relevance, effectiveness, pertinence and coherence of the DMD. The Commission particularly wants to hear from consumers, retail financial services providers and authorities responsible for supervising and enforcing compliance with the DMD’s provisions.

Responses to the consultation can be made by completing an online questionnaire, which is linked to from the consultation webpage. Comments can be made on the consultation until 2 July 2019. The Commission expects to publish the conclusions of the evaluation exercise by the end of 2019.

European Commission Adopts New Delegated Regulation Identifying High-Risk Third Countries under MLD4

 

On February 13, the European Commission adopted a Delegated Regulation (C(2019) 1326 final) which supplements the Fourth Money Laundering Directive ((EU) 2015/849) (“MLD4“) by identifying 23 high-risk third countries with strategic deficiencies. The Delegated Regulation will repeal Delegated Regulation (EU) 2016/1675 which currently lists 16 countries as high-risk. READ MORE

European Commission Adopts Delegated Regulation Supplementing EuVECA Regulation

 

On February 4, the European Commission adopted a Delegated Regulation supplementing the European Venture Capital Funds (“EuVECA“) Regulation (345/2013) with regard to conflicts of interest (C(2019) 664 final).

The Delegated Regulation specifies the types of conflicts of interest, referred to in Article 9 of the EuVECA Regulation, and the steps that managers of EuVECA funds need to take to identify, prevent, manage, monitor and disclose conflicts.

The Delegated Regulation will enter into force 20 days after its publication in the Official Journal of the EU. It will apply six months after its entry into force. The next step is for the Delegated Regulation to be considered by the European Parliament and Council of the EU. Delegated Regulation.

ECA Publishes a Communication on Access to ECB Banking Supervision Documents and Information

 

On January 14, the European Court of Auditors (“ECA“) published a communication to the European Parliament on the European Central Bank’s (“ECB“) position on the ECA’s access to audit documents and information relating to its banking supervision role under the single supervisory mechanism (“SSM“). READ MORE

Joint Committee of ESAs Publishes Report on Regulatory Sandboxes and Innovation Hubs

 

On January 7, the Joint Committee of the European Supervisory Authorities (“ESAs“) (that is, the EBA, EIOPA and ESMA) published a report (JC 2018 74) on regulatory sandboxes and innovation hubs.

The ESAs set out in the report a comparative analysis of the innovation facilitators established to date within the EU, further to the mandate specified in the European Commission’s FinTech action plan, which was published in March 2018. READ MORE

European Commission 2019 Work Program: Financial Services Aspects

 

On October 23, the European Commission published a communication outlining its work program for 2019. There are a number of priority-pending financial services legislative proposals which the Commission wants the European Parliament and the Council of the EU to take swift action on. The proposals include:

  • Sustainable finance
  • Cross-border investment funds
  • Crowdfunding services
  • The pan-European pension product (“PEPP“)
  • Banking
  • Recovery and resolution on central counterparties (“CPPs“)
  • The European deposit insurance schemes (“EDIS“)
  • Anti-money laundering

The full communication can be found here. The Annexes were published separately, alongside a Q&As document and a factsheet.

Provision of Microcredit in Europe: Commission to Update European Good Code of Conduct

 

The European Commission (Directorate-General for Employment, Social Affairs and Inclusion) published a press release informing readers that it is updating the European good code of conduct for microcredit provision. The publication can he found here.

Originally launched in 2011, the code’s aim was to provide a common set of standards relating to management, governance, risk management, reporting and consumer and investor relations for the EU microfinance sector.

The purpose of the update is to reflect market changes and the diversity of the microfinance sector. The updates are expected to be in place over the next 12 months.

European Commission Publishes Memo on Preparing for Brexit

 

The communication, published on July 19, 2018, points out that citizens, businesses, state bodies and others will be affected by Brexit and that a joint effort from all parties is required in order to be fully prepared.

The communication warns to prepare for two main scenarios:

  • If the Withdrawal Agreement is ratified before March 30, 2019, EU law will stop applying to the UK after the agreed transition period of 21 months, that is on January 1, 2021.
  • If the Withdrawal Agreement is not ratified before March 30, 2019, there will be no transition period and EU law will stop applying to the UK on March 30, 2019.

There will be consequences for many industries and the Commission has published more detailed preparedness notices on a sector-by-sector basis. These notices can be found here.

In terms of next steps, the Commission will ask the European Parliament and the European Council to prioritize the adoption of its Brexit proposals, so that they will be in force by the withdrawal date.

There is another Brexit meeting on October 18, 2018, after which the European Council will review the situation again.