Brussels, 19 April 2006
The European Commission’s Clearing and Settlement Fiscal Compliance expert group (“FISCO”) has issued a Fact Finding Study examining EU Member States' fiscal compliance procedures for clearing and settlement of cross-border securities transactions. The Study analyses how these procedures hinder the functioning of capital markets and increase the cost of cross-border settlement, particularly in relation to withholding and transaction taxes. The FISCO group will issue a further report proposing solutions by early 2007.
Internal Market and Services Commissioner McCreevy said: "The FISCO Study will help us to identify and tackle many of those fiscal compliance practices and procedures that are current barriers to more efficient pan-European securities trading in the EU. This is an area that was highlighted as one to be addressed by the group of financial experts chaired by Alberto Giovannini and is an area where we need to make further progress to help deepen financial market integration. "
Taxation and Customs Union Commissioner Kovacs added: "I fully endorse the importance of this Study and the need to reinforce the economic efficiencies of financial market integration by removing tax obstacles. And I look forward to the FISCO Final Report, which will propose possible solutions for the removal of barriers in taxation to cross-border securities trading within the EU."
Main conclusions of the Fact Finding Study
Withholding tax procedures
Transaction tax procedures
About the FISCO Group
FISCO, created in March 2005 (IP/05/434), gives advice on the removal of fiscal compliance barriers to the clearing and settlement of EU cross-border securities transactions. The key issues considered by the Group are 'Giovannini Barriers' 11 and 12 on withholding and transaction tax procedures respectively.
FISCO is composed of 15 high-level experts, mainly from private bodies and academia. The Commission will use FISCO's findings as a basis for discussion with Member States in line with its established policy of prior consultation on tax issues.
For more details of EU policy on clearing and settlement: