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Commission proposes extension of rules on cross-border euro payments to direct debits
Commission Européenne - IP/08/1506 15/10/2008
Brussels, 15 October 2008
The European Commission has put forward a proposal modifying the provisions and extending the scope of the 2001 Regulation on cross-border euro payments, under which cross-border bank transfers in euro within the EU cost the same as domestic transfers. The proposal comes in response to the rapid evolution of the EU payments market. It aims at extending the principle of equality of charges to direct debit payments. It also contains some provisions enhancing the protection of consumer interests and rights and alleviating the statistical reporting burden.
Internal Market and Services Commissioner Charlie McCreevy said: "It is essential in an integrated payment market to ensure that payment users see no practical difference between domestic and cross-border transactions. This new proposal is a natural complement to the progressive creation of a Single Euro Payment Area, which should provide significant savings and benefits to European consumers and businesses."
The proposal is the final result of the review process of Regulation 2560/2001, carried out by the Commission since 2005 and finalised with the publication of a Report in February 2008 (see IP/08/305). The Report had concluded, in particular, that Regulation 2560/2001 should be modified to take account of the emergence of the Single Euro Payments Area, to address some weaknesses identified during the review process and to align it with the Payment Services Directive (2007/64/EC) in order to create a fully consistent legal framework for payments in Europe.
The proposal extends the principle of equality of charges to direct debit payments, which will become available on a cross-border basis as from November 2009 (see IP/07/1914). As is already the case with credit transfers, ATM cash withdrawals and card payments, the cost of a cross-border direct debit in euro will become the same as the cost of a national direct debit. The proposal also provides for the setting-up of out-of-court redress bodies responsible for solving disputes related to cross-border payments, thereby enhancing the protection of consumer rights in this field. The proposal also aims at phasing out certain statistical reporting obligations relating to balance of payments, thus alleviating administrative and financial burdens and facilitating the implementation of the Single Euro Payments Area.
The new Regulation, if agreed upon by the European Parliament and the Council, would replace the existing text as from 1 November 2009.
About Regulation 2560/2001 on cross-border payments in euro
Regulation (EC) No 2560/2001 of the European Parliament and of the Council on cross-border payments in euro entered into force on 31 December 2001. It applies currently to credit transfers, ATM cash withdrawals and electronic payments (including card payments) made in euro up to an amount of EUR 50 000. It guarantees that when a consumer makes a cross-border payment in euro, the cost is the same as that of a corresponding payment in euro made within his own Member State.
The Regulation has in effect brought down the charges for cross-border payment transactions in euro to the level of national charges and encouraged the European payments industry to build an EU-wide payments infrastructure that is necessary in order to create the Single Euro Payments Area (SEPA).
The proposal is available at: