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Brussels, 27th November 2001

Commission welcomes Council's political agreement on cross-border payments proposal

The European Commission has welcomed the political agreement reached by the EU's Council of Internal Market Ministers on the proposed Regulation according to which charges for bank transactions in the Internal Market should be the same across borders as within a single Member State. The political agreement was reached on the evening of 26th November at the Council's meeting in Brussels. The amendments agreed by the Council were endorsed by the Commission in the interest of achieving an agreement. Once the Council has formally adopted its Common Position on the proposal without discussion at a forthcoming meeting, it will be forwarded to the European Parliament for its second reading.

"I am delighted that that Council has reached political agreement on the cross-border payments Regulation just four months after it was proposed by the Commission", Internal Market Commissioner Frits Bolkestein commented after the Council. "This Regulation will help consumers and small businesses to take full advantage of the Internal Market and the euro without having to pay through the nose for cross-border transactions. I hope that the Regulation can be definitively adopted as soon as possible, once the European Parliament has had the opportunity to have its say on the text endorsed by the Council. This would allow people to enjoy the full benefits of the new rules in time for their summer holidays next year."

The proposal was presented by the Commission in July 2001 (see IP/01/1084 and MEMO/01/279). As amended by the Council, the Regulation would require:

  • the charges for withdrawals from cash machines and the use of bank cards (up to €12,500) to be the same, when denominated in euros, for both national and cross-border transactions, as from 1 July 2002

  • the charges for credit transfers (up to €12,500) between bank accounts to be the same, when denominated in euros, for both national and cross-border transactions, as from 1 July 2003

  • customers to be properly informed in advance of the charges they will incur when making national and cross-border payments. Any price changes would have to be notified in advance as well.

  • mandatory use of the ISO standard codes, namely IBAN (International Bank Account Number) and BIC (Bank Identifier Code), in order to allow banks to process credit transfers in a fully automated way.

The Regulation would also apply to transactions denominated in those non-euro currencies whose Member States notified the Commission that they wanted the rules to apply.

The Regulation's rules would be extended to cash machine withdrawals, use of bank cards and credit transfers up to €50,000 from 1 January 2006.

A Regulation, unlike a Directive, is directly applicable in the Member States without national implementing measures.

A survey published by the Commission in September 2001 indicated that the average cost of cross-border credit charges remained virtually the same in 2001 as in 1993 (€24 for transfers of €100 see IP/01/1293 and MEMO/01/294).

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