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Brussels, 12th May 2004
Results of Council of Economics and Finance Ministers, Brussels, 10-11 May 2004 Taxation and Financial Services
European Commissioner for Taxation Frits Bolkestein and Irish Finance Minister Charlie McCreevy, on behalf of the Presidency of the Council, updated the Council on progress made in negotiations on savings tax agreements with Andorra, Liechtenstein, Monaco and San Marino. The United Kingdom also reported on progress on savings tax arrangements with the UK's Crown Dependencies and Caribbean Territories. The Council welcomed progress made with Andorra on a savings tax agreement as well as the prospect of a monetary agreement with Andorra, in respect of which it adopted a Decision on the position to be taken. As regards Liechtenstein, Monaco and San Marino, the Council took note of developments since its meeting on 9 March and reaffirmed its support for the position taken by the Commission in the negotiations. In particular, it emphasised its unwillingness to make concessions in relation to the benefits of the EU Directives on interest and royalties and parent companies and subsidiaries.
The Council reaffirmed its determination for the various savings tax negotiations to be finalised. This will enable it to conclude that the conditions for applying the provisions of the savings tax Directive namely that equivalent measures are applied by Andorra, Liechtenstein, Monaco, San Marino and Switzerland, and that the same measures are applied by the UK and Netherlands dependent and associated countries will be met.
The Council reached political agreement on the draft Directive on transparency requirements with regard to information on issuers whose securities are admitted to trading on a regulated market, as amended by the European Parliament in first reading (see IP/04/398). As Council agrees with the amendments of the Parliament, the Council can approve the Directive without the need for a second reading by Parliament or Council. However, formal adoption of the Directive is only due to take place in the autumn because of delays in translating the Directive into the 20 official languages. The Directive on transparency requirements will revise and replace provisions of Directive 2001/34/EC on the admission of securities to official stock exchange listing.
The aim is to upgrade the information available to investors, thus helping them to allocate their funds on the basis of a more informed assessment. The Directive aims to ensure that investors receive interim management statements from those share issuers who do not publish quarterly reports, and halfyearly financial reports from issuers of new bonds. In addition, all securities issuers will have to provide annual financial reports within four months after the end of the financial year. The Directive is also expected to improve dissemination of information on issuers.
Measures to improve regulation of banking, insurance and investment funds
The Council reached political agreement on a proposal for a Directive to allow the EU to respond far more quickly to developments in the financial sector. Formal adoption will only to take place in the autumn because of delays in translating the Directive into the 20 official languages. Once the Directive is formally adopted, six Commission Decisions will also enter into effect to form a package creating a modern and streamlined decision-making structure for financial services with the aim of improved regulatory and supervisory co-operation (see IP/03/1507). The package aims to extend the committee structure and approach already used in the securities sector since 2002 (see IP/02/195) to banking, insurance and investment funds (UCITS). Once agreed and implemented, the measures will produce real benefits by allowing greater and more detailed co-operation between supervisors and much greater convergence in day-to-day regulation and supervision.
The package will create four new committees. The first two, the European Banking Committee (EBC) and European Insurance and Occupational Pensions Committee (EIOPC) will like the European Securities Committee (ESC) for securities - assist the Commission in adopting implementing measures for EU Directives. The EBC and EIOPC will replace the existing Banking Advisory Committee (BAC) and the Insurance Committee (IC). Meanwhile, responsibility for overseeing the implementation of EU law on collective investment funds - so-called UCITS - will be transferred from the UCITS Contact Committee to the existing European Securities Committee (ESC) and Committee of European Securities Regulators (CESR).
The Council took note of the situation regarding excise duty rates on alcohol and of concerns expressed by Sweden regarding delay in the presentation by the European Commission of a report on this subject. Taxation Commissioner Frits Bolkestein indicated that the draft report was still being debated within the Commission but that it could adopt it in the course of the coming weeks. He indicated that it was not possible to give an exact date. He added that, given that the Commission had not yet taken a final decision on this report, he could not enter into detail on its possible content but confirmed that this report would not be accompanied by a proposal to modify the existing system of minimum rates. Instead, the report would aim to stimulate discussions within the Council and the European Parliament on the need for and possible elements of a change to the current system.