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CONTLNTS
October 2006
Antbony Dempsey
Luropean Commlsslon
DG |nternal Market ano Servlces
Unlt A-4
8 - 1049 8russels
Tel: (+32 2) 295 73 57
Fa×: (+32 2) 295 43 51
Loltor
Nlgel Grl||ltbs
Tel: (+32 2) 298 65 11
Subscrlptlons
Anlta Haase
DG |nternal Market ano Servlces
C100 1/130
8-1049 8russels
Fa×: +32 2 295 43 51
L-mall: Markt-smn@ec.europa.eu
www.ec.europa.eu/lnternal_market/smn.btm
Layout:
Unlt A4
Onllne
bttp://ec.europa.eu/lnternal_market/smn.btm
© Luropean Communltles, |2006]
Peproouctlon ls autborlseo provloeo tbe source ls
acknowleogeo.
For |urtber ln|ormatlon
bttp://ec.europa.eu/lnternal_market/lnoe×_en.btm
Your Lurope
bttp://ec.europa.eu/youreurope
3 Loltorlal
4 Future Slngle Market pollcy unoer tbe spotllgbt
7 Flnanclal lntegratlon ln worlo markets lntensl|les
8 Commlsslon proposes |ull openlng o|
postal markets by 2009
10 Commlsslon acts to lmprove M&A supervlsory
approval process
11 SPLC|AL FLATUPL
Cross-boroer lnvestment: More barrlers to come oown
15 Auoltors' llablllty - stuoy sbows tbreat o| current
rules to |lnanclal stablllty
16 L8TP ln new pusb to bear tbe volce o| LU buslness

18 LU prepares |or tbe accesslon o| 8ulgarla ano Pomanla
20 Clearlng ano settlement: lnoustry Cooe o| Conouct
gets Commlsslon backlng
21 Presloency pusbes |or slgn-up to tbe Hague
Securltles Conventlon
22 |n|rlngements
Pbotograpbs |or tbls eoltlon
were supplleo by:
Grl|co Communlcatlons, UN|CL ano
tbe Luropean Commlsslon.
|n November 2007, a major plece o| |lnanclal servlces leglslatlon wlll
come lnto |orce |urtber oeveloplng tbe |ramework o| a slngle market
ln tbe LU |or traolng ln sbares, bonos, oerlvatlves ano otber lnvest-
ment prooucts ano servlces. Member States are obllgeo to aoopt tbe
necessary leglslatlon transposlng tbls new |ramework by [anuary
2007. Known as tbe 'MlF|D' - tbe Markets ln Flnanclal |nstruments
Dlrectlve - lt contalns measures wblcb wlll lncrease lnvestor protec-
tlon, cbange ano lmprove tbe organlsatlon ano |unctlonlng o| lnvest-
ment |lrms, |acllltate cross-boroer traolng ln securltles, ano stlmulate
tbe |urtber lntegratlon o| LU capltal markets. Tbe MlF|D leglslatlon ls
a key element o| tbe Flnanclal Servlces Actlon Plan. |ts objectlve ls to
enable lnvestors to lnvest more easlly ano wltb |ull con|loence across
LU boroers ano to remove obstacles to tbe use o| tbe LU lnvestment
servlces 'slngle passport'. See tbe Speclal Feature on page 11.
Followlng a wloe-ranglng consultatlon on |uture Slngle Market
pollcy launcbeo ln Aprll 2006, a one-oay Publlc Hearlng wlll take
place ln 8russels 29 November. Tbe consultatlon e×erclse enjoyeo
a gooo response ano bas gatbereo valuable vlews ano lnslgbts |rom
stakeboloers across a broao spectrum o| Slngle Market pollcy lssues
as well as stlmulatlng wloer publlc oebate. Tbe |lnolngs o| tbe consul-
tatlon ano Publlc Hearlng wlll |eeo lnto a major Pevlew o| tbe Slngle
Market ln tbe 21st century to be presenteo by tbe Commlsslon ln
2007. See page 4.
Tbe Commlsslon bas put |orwaro a proposal to |ully open LU postal
markets to competltlon by 2009, ln llne wltb tbe agreeo target oate
set out ln tbe current Postal Dlrectlve. On tbe basls o| e×tenslve re-
searcb, tbe Commlsslon belleves tbat tbls ls tbe best way to malntaln
unlversal servlce wblle |urtber lmprovlng quallty ano cbolce |or LU
consumers ano buslnesses. Full market openlng means tbat natlonal
operators wlll no longer bave a monopoly on mall below a certaln
welgbt (currently a ma×lmum o| 50 grams), known as tbe 'reserveo
area'. See page 8.
Wltb tbe arrlval o| 8ulgarla ano Pomanla at tbe beglnnlng 2007, tbe
number o| countrles ln tbe Luropean Unlon wlll rlse to twenty seven.
As tbe LU attalns lts 50tb blrtboay ln 2007, lts populatlon wlll bave
rlsen to more tban 483 mllllon cltlzens slnce tbe Treaty o| Pome was
slgneo ln 1957. Tbe number o| o||lclal languages wlll bave e×panoeo
to 22 ano, oue to tbe accesslon o| 8ulgarla, tbe Cyrllllc alpbabet wlll
be useo |or tbe |lrst tlme. Tbe two new States bave maoe consloer- rr
able e||ort to complete preparatlons |or LU membersblp ano tbougb
tbere remalns work to oo ln a |ew areas be|ore tbe eno o| tbe year,
most o| tbe leglslatlon relatlng to tbe Slngle Market ls well ln bano.
A Commlsslon report on tbe prevlous 2004 Lnlargement lnolcates
tbat tbe economlc bene|lts to botb new ano olo Member States bas
been posltlve. See page 18.
Tblerry Stoll
LD|TOP|AL
Actlng Dlrector General
Tblerry Stoll
3
43
CONTLNTS
October 2006
Antbony Dempsey
Luropean Commlsslon
DG |nternal Market ano Servlces
Unlt A-4
8 - 1049 8russels
Tel: (+32 2) 295 73 57
Fa×: (+32 2) 295 43 51
Loltor
Nlgel Grl||ltbs
Tel: (+32 2) 298 65 11
Subscrlptlons
Anlta Haase
DG |nternal Market ano Servlces
C100 1/130
8-1049 8russels
Fa×: +32 2 295 43 51
L-mall: Markt-smn@ec.europa.eu
www.ec.europa.eu/lnternal_market/smn.btm
Layout:
Unlt A4
Onllne
bttp://ec.europa.eu/lnternal_market/smn.btm
© Luropean Communltles, |2006]
Peproouctlon ls autborlseo provloeo tbe source ls
acknowleogeo.
For |urtber ln|ormatlon
bttp://ec.europa.eu/lnternal_market/lnoe×_en.btm
Your Lurope
bttp://ec.europa.eu/youreurope
3 Loltorlal
4 Future Slngle Market pollcy unoer tbe spotllgbt
7 Flnanclal lntegratlon ln worlo markets lntensl|les
8 Commlsslon proposes |ull openlng o|
postal markets by 2009
10 Commlsslon acts to lmprove M&A supervlsory
approval process
11 SPLC|AL FLATUPL
Cross-boroer lnvestment: More barrlers to come oown
15 Auoltors' llablllty - stuoy sbows tbreat o| current
rules to |lnanclal stablllty
16 L8TP ln new pusb to bear tbe volce o| LU buslness

18 LU prepares |or tbe accesslon o| 8ulgarla ano Pomanla
20 Clearlng ano settlement: lnoustry Cooe o| Conouct
gets Commlsslon backlng
21 Presloency pusbes |or slgn-up to tbe Hague
Securltles Conventlon
22 |n|rlngements
Pbotograpbs |or tbls eoltlon
were supplleo by:
Grl|co Communlcatlons, UN|CL ano
tbe Luropean Commlsslon.
|n November 2007, a major plece o| |lnanclal servlces leglslatlon wlll
come lnto |orce |urtber oeveloplng tbe |ramework o| a slngle market
ln tbe LU |or traolng ln sbares, bonos, oerlvatlves ano otber lnvest-
ment prooucts ano servlces. Member States are obllgeo to aoopt tbe
necessary leglslatlon transposlng tbls new |ramework by [anuary
2007. Known as tbe 'MlF|D' - tbe Markets ln Flnanclal |nstruments
Dlrectlve - lt contalns measures wblcb wlll lncrease lnvestor protec-
tlon, cbange ano lmprove tbe organlsatlon ano |unctlonlng o| lnvest-
ment |lrms, |acllltate cross-boroer traolng ln securltles, ano stlmulate
tbe |urtber lntegratlon o| LU capltal markets. Tbe MlF|D leglslatlon ls
a key element o| tbe Flnanclal Servlces Actlon Plan. |ts objectlve ls to
enable lnvestors to lnvest more easlly ano wltb |ull con|loence across
LU boroers ano to remove obstacles to tbe use o| tbe LU lnvestment
servlces 'slngle passport'. See tbe Speclal Feature on page 11.
Followlng a wloe-ranglng consultatlon on |uture Slngle Market
pollcy launcbeo ln Aprll 2006, a one-oay Publlc Hearlng wlll take
place ln 8russels 29 November. Tbe consultatlon e×erclse enjoyeo
a gooo response ano bas gatbereo valuable vlews ano lnslgbts |rom
stakeboloers across a broao spectrum o| Slngle Market pollcy lssues
as well as stlmulatlng wloer publlc oebate. Tbe |lnolngs o| tbe consul-
tatlon ano Publlc Hearlng wlll |eeo lnto a major Pevlew o| tbe Slngle
Market ln tbe 21st century to be presenteo by tbe Commlsslon ln
2007. See page 4.
Tbe Commlsslon bas put |orwaro a proposal to |ully open LU postal
markets to competltlon by 2009, ln llne wltb tbe agreeo target oate
set out ln tbe current Postal Dlrectlve. On tbe basls o| e×tenslve re-
searcb, tbe Commlsslon belleves tbat tbls ls tbe best way to malntaln
unlversal servlce wblle |urtber lmprovlng quallty ano cbolce |or LU
consumers ano buslnesses. Full market openlng means tbat natlonal
operators wlll no longer bave a monopoly on mall below a certaln
welgbt (currently a ma×lmum o| 50 grams), known as tbe 'reserveo
area'. See page 8.
Wltb tbe arrlval o| 8ulgarla ano Pomanla at tbe beglnnlng 2007, tbe
number o| countrles ln tbe Luropean Unlon wlll rlse to twenty seven.
As tbe LU attalns lts 50tb blrtboay ln 2007, lts populatlon wlll bave
rlsen to more tban 483 mllllon cltlzens slnce tbe Treaty o| Pome was
slgneo ln 1957. Tbe number o| o||lclal languages wlll bave e×panoeo
to 22 ano, oue to tbe accesslon o| 8ulgarla, tbe Cyrllllc alpbabet wlll
be useo |or tbe |lrst tlme. Tbe two new States bave maoe consloer- rr
able e||ort to complete preparatlons |or LU membersblp ano tbougb
tbere remalns work to oo ln a |ew areas be|ore tbe eno o| tbe year,
most o| tbe leglslatlon relatlng to tbe Slngle Market ls well ln bano.
A Commlsslon report on tbe prevlous 2004 Lnlargement lnolcates
tbat tbe economlc bene|lts to botb new ano olo Member States bas
been posltlve. See page 18.
Tblerry Stoll
LD|TOP|AL
Actlng Dlrector General
Tblerry Stoll
3
43
N
o
43 Oc t obe r 2006
4
N
o
43 Oc t obe r 2006
5
Future Slngle Market
pollcy unoer tbe spotllgbt
An e×tenslve publlc consultatlon on |uture Slngle Market
pollcy took place between Aprll ano [une 2006. |t ls belng
|olloweo by a Publlc Hearlng ln 8russels, 29 November. Tbe
|lnolngs wlll |eeo lnto a major Pevlew o| tbe Slngle Market
ln tbe 21st century to be presenteo by tbe Commlsslon ln
2007. Slngle Market News talks to [acquellne Mlnor, Dlrector
o| Horlzontal Pollcy Development ln DG |nternal Market ano
Servlces about tbe |lnolngs so |ar.
Spotllgbt
T
be alm o| tbe consultatlon launcbeo
ln Aprll was to gatber tbe vlews ano
lnslgbts o| tbe varlous stakeboloers on
|uture pollcy prlorltles ano prepare tbe
grouno |or a new Slngle Market pollcy,
wblcb ls |ully ln tune wltb tooay's per- rr
celveo cballenges.
Tbe consultatlon was open to anyone a|- ||
|ecteo by tbe Slngle Market, e.g. cltlzens,
buslnesses, aomlnlstratlons, NGOs ano
tblnk tanks. |ts prlmary |ocus was tbe
current state o| tbe Slngle Market ano
tbe posslble |uture pollcy.
A summary o| tbe vlews presenteo by
tbe responoents to tbe publlc consulta-
tlon was publlsbeo ln September.*
Tbey cover a broao spectrum o| Slngle
Market pollcy lssues ano come |rom a
wloe range o| stakeboloers.
Tbe wbole process wlll |eeo lnto a Pub-
llc Hearlng ln 8russels, 29 November,
ano tbe subsequent report on a Pevlew
o| tbe Slngle Market ln tbe 21st century
to be presenteo by tbe Commlsslon ln
2007.
Gooo response
"We were generally pleaseo wltb tbe
response to tbe consultatlon wblcb was
launcbeo ln Aprll,"says [acquellne Mlnor,
Dlrector o| Horlzontal Pollcy Develop-
ment ln DG |nternal Market ano Serv-
lces. "Tbe Commlsslon recelveo about
Spotllgbt
1,150 replles ano tbe response was ge-
ograpblcally well spreao. We recelveo
lnput |rom all Member States, as well
as Pomanla ano Norway ano tbe LFTA
secretarlat. However, we got almost no
replles |rom reglonal or local autborltles
÷ a real plty slnce lt ls lmportant to know
also wbat's lmportant at tbe local level.
On tbe otber bano some natlonal regu-
latory autborltles olo reply. Tbe majorlty
o| tbe replles came |rom representatlve
organlsatlons. "
Pegarolng natlonal organlsatlons, tbere
was a remarkable lack o| partlclpants
|rom tbe new Member States. Tbe same
was true |or lnolvloual buslnesses. "Two
Pollsb |lrms replleo, but we got very llttle
|eeoback about wbat otber |lrms, cltlzens
or organlsatlons ln new Member States
tblnk."
Work to be oone
On tbe posltlve sloe tbe consultatlon
generally sboweo a great oeal o| support
|or tbe Slngle Market, sbe polnts out.
However, lnoustry says tbat a lot stlll bas
to be oone, slnce tbe Slngle Market ls not
yet complete.
"Tbere was a clear message tbat ln tbe
area o| servlces, retall |lnanclal servlces,
ln tbe banklng ano payment areas ano ln-
tellectual property, we bave to lmprove
regulatlon.
"|n partlcular, tbe current |PP reglme as
regaros patents ano copyrlgbt ls conslo-
ereo unsatls|actory. 8ut tbe retall market
ln general ls not seen as |unctlonlng well
at all. |n tbls conte×t, LU retallers re-
|erreo to a recent stuoy tbat compares
tbe per|ormance o| Lurope's retall sector
to tbat o| tbe US ano tbat came to tbe
concluslon tbat at least bal| o| tbe gap ln
per|ormance ls tbe result o| lnapproprl-
ate regulatlon."
Tbe consultatlon also reveals tbat tbe
Slngle Market ls also vleweo as lagglng be-
blno ln tbe |lelo o| servlces. Tbe respono-
ents tblnk, tbat tbe |ortbcomlng Servlces
Dlrectlve wlll be an lmprovement, but
stlll lnsu||lclent to create well-|unctlonlng
servlces markets.
Otber areas clteo as ln urgent neeo o| lm-
provement were lnsurance, transport ano
energy. Stakeboloers also calleo |or more
|lscal barmonlsatlon ano |or a more e||ec-
tlve ways o| securlng tbe |ree movement
o| workers, lncluolng researcbers, wblcb
coulo encourage more lnnovatlon.
"At present, buslness complalns tbat lt ls
ol||lcult to blre ano trans|er employees
wltbln tbe LU because o| tbe lack o| port-
ablllty o| penslon rlgbts ano ol||erences ln
soclal securlty systems. |n aooltlon, many
new Member States ano buslnesses crltl-
clse tbe oelays ln tbe |ree movement o|
workers |rom tbe new Member States, "
Ms Mlnor aoos.
Tanglble bene|lts!
"One message emerglng |rom tbe con-
sultatlon ls tbat consumers ano SMLs
oo not always |eel tanglble bene|lts |rom
tbe Slngle Market. Tbougb an
overwbelmlng majorlty con-
sloers tbe Slngle Market to be
a gooo tblng.
"Tbe bene|lts ln terms o| oe-
llverlng more growtb ano jobs
are clearly recognlseo, but
traoe unlons warneo us tbat
Slngle Market pollcles may
unoerllne tbe wel|are state,
ano tbus leao to lower publlc
ano prlvate consumptlon. Tbls
woulo, ln turn, leao to lower
growtb.
"Ano wbllst economlc
bene|lts are clearly
acknowleogeo, many
stakeboloers say tbat
tbe Slngle Market ls es-
sentlally a 'blg buslness
a||alr' ano call upon
tbe Commlsslon ano
Member States to en-
sure tbat tbe sltuatlon
o| small companles ano
consumers ls taken lnto account.
"Tbe consultatlon also sboweo tbat
varlous stakeboloers percelve tbe Slngle
Market as lacklng a su||lclent 'soclal bal-
ance'."
Future pollcy olrectlons
Altbougb tbere ls stlll mucb work to oo
on tbe oetalls o| tbe |uture pollcy, lt ls
becomlng clear, Ms Mlnor says, tbat tbe
maln lssues, tbat sboulo guloe our ap-
proacb, can be summarlseo ln tbe |lve C's:
completlon, consolloatlon, co-operatlon,
cbange ano communlcatlon.
"Completlon ls about tbe several gaps
tbat stlll bave to be |llleo to lmprove tbe
|unctlonlng o| tbe Slngle Market. 8ut we
sboulo not unoerestlmate wbat we bave
alreaoy got, wblcb leaos me to tbe secono
C, consolloatlon, wblcb baslcally means
tbat we wlll bave to |ocus on proper
transposltlon, lmplementatlon ano en-
|orcement o| LU-law.
"Co-operatlon means tbat tbe Slngle
Market slmply cannot |unctlon well, un-
less Member States ano tbe Commlsslon
are actlng ln concert ano work togetber.
Tbls slgnl|les tbat on tbe one bano tbe
Commlsslon bas to stano |lrm ln lts role
as Guarolan o| tbe Treatles, but lt ls vl-
tal to engage Member States ln a oeeper
partnersblp wblcb unoerllnes our sbareo
responslblllty |or maklng tbe Slngle Mar- rr
ket work better.
Tbe |ourtb C ls cbange. Tbe worlo ln
2006 ls a very ol||erent place |rom 1984
wben tbe Slngle Market project was |lrst
launcbeo. We neeo to aooress tbe cbal-
lenges o| globallsatlon, enlargement ano
an agelng populatlon.
"Last but not least tbe |l|tb C ls commu-
nlcatlon. All tbe above wlll be ln valn l| we
cannot succeeo ln re-connectlng cltlzens
to tbe project. We bave to communlcate
ano oemonstrate tbat tbe Slngle Market ls
oellverlng bene|lts to everyone. "
Tbe consultatlon unoertaken earller
tbls year ls ltsel| one o| tbe steps to-
waros acblevlng better communlcatlon,
sbe polnts out. "Slnce communlcatlon
bas to be a mutual tblng, lt ls |unoamen-
tal tbat we learn about tbe vlews o| tbe
stakeboloers."

[acquellne Mlnor, Dlrector o|
Horlzontal Pollcy Development:
"...tbe maln lssues, tbat sboulo
guloe our approacb, can be sum-
marlseo ln tbe |lve C's:
completlon, consolloatlon,
co-operatlon, cbange ano
communlcatlon."
"Tbere was a clear message tbat ln tbe area
o| servlces, retall |lnanclal servlces, ln tbe
banklng ano payment areas ano lntellectual
property, we bave to lmprove regulatlon."
N
o
43 Oc t obe r 2006
4
N
o
43 Oc t obe r 2006
5
Future Slngle Market
pollcy unoer tbe spotllgbt
An e×tenslve publlc consultatlon on |uture Slngle Market
pollcy took place between Aprll ano [une 2006. |t ls belng
|olloweo by a Publlc Hearlng ln 8russels, 29 November. Tbe
|lnolngs wlll |eeo lnto a major Pevlew o| tbe Slngle Market
ln tbe 21st century to be presenteo by tbe Commlsslon ln
2007. Slngle Market News talks to [acquellne Mlnor, Dlrector
o| Horlzontal Pollcy Development ln DG |nternal Market ano
Servlces about tbe |lnolngs so |ar.
Spotllgbt
T
be alm o| tbe consultatlon launcbeo
ln Aprll was to gatber tbe vlews ano
lnslgbts o| tbe varlous stakeboloers on
|uture pollcy prlorltles ano prepare tbe
grouno |or a new Slngle Market pollcy,
wblcb ls |ully ln tune wltb tooay's per- rr
celveo cballenges.
Tbe consultatlon was open to anyone a|- ||
|ecteo by tbe Slngle Market, e.g. cltlzens,
buslnesses, aomlnlstratlons, NGOs ano
tblnk tanks. |ts prlmary |ocus was tbe
current state o| tbe Slngle Market ano
tbe posslble |uture pollcy.
A summary o| tbe vlews presenteo by
tbe responoents to tbe publlc consulta-
tlon was publlsbeo ln September.*
Tbey cover a broao spectrum o| Slngle
Market pollcy lssues ano come |rom a
wloe range o| stakeboloers.
Tbe wbole process wlll |eeo lnto a Pub-
llc Hearlng ln 8russels, 29 November,
ano tbe subsequent report on a Pevlew
o| tbe Slngle Market ln tbe 21st century
to be presenteo by tbe Commlsslon ln
2007.
Gooo response
"We were generally pleaseo wltb tbe
response to tbe consultatlon wblcb was
launcbeo ln Aprll,"says [acquellne Mlnor,
Dlrector o| Horlzontal Pollcy Develop-
ment ln DG |nternal Market ano Serv-
lces. "Tbe Commlsslon recelveo about
Spotllgbt
1,150 replles ano tbe response was ge-
ograpblcally well spreao. We recelveo
lnput |rom all Member States, as well
as Pomanla ano Norway ano tbe LFTA
secretarlat. However, we got almost no
replles |rom reglonal or local autborltles
÷ a real plty slnce lt ls lmportant to know
also wbat's lmportant at tbe local level.
On tbe otber bano some natlonal regu-
latory autborltles olo reply. Tbe majorlty
o| tbe replles came |rom representatlve
organlsatlons. "
Pegarolng natlonal organlsatlons, tbere
was a remarkable lack o| partlclpants
|rom tbe new Member States. Tbe same
was true |or lnolvloual buslnesses. "Two
Pollsb |lrms replleo, but we got very llttle
|eeoback about wbat otber |lrms, cltlzens
or organlsatlons ln new Member States
tblnk."
Work to be oone
On tbe posltlve sloe tbe consultatlon
generally sboweo a great oeal o| support
|or tbe Slngle Market, sbe polnts out.
However, lnoustry says tbat a lot stlll bas
to be oone, slnce tbe Slngle Market ls not
yet complete.
"Tbere was a clear message tbat ln tbe
area o| servlces, retall |lnanclal servlces,
ln tbe banklng ano payment areas ano ln-
tellectual property, we bave to lmprove
regulatlon.
"|n partlcular, tbe current |PP reglme as
regaros patents ano copyrlgbt ls conslo-
ereo unsatls|actory. 8ut tbe retall market
ln general ls not seen as |unctlonlng well
at all. |n tbls conte×t, LU retallers re-
|erreo to a recent stuoy tbat compares
tbe per|ormance o| Lurope's retall sector
to tbat o| tbe US ano tbat came to tbe
concluslon tbat at least bal| o| tbe gap ln
per|ormance ls tbe result o| lnapproprl-
ate regulatlon."
Tbe consultatlon also reveals tbat tbe
Slngle Market ls also vleweo as lagglng be-
blno ln tbe |lelo o| servlces. Tbe respono-
ents tblnk, tbat tbe |ortbcomlng Servlces
Dlrectlve wlll be an lmprovement, but
stlll lnsu||lclent to create well-|unctlonlng
servlces markets.
Otber areas clteo as ln urgent neeo o| lm-
provement were lnsurance, transport ano
energy. Stakeboloers also calleo |or more
|lscal barmonlsatlon ano |or a more e||ec-
tlve ways o| securlng tbe |ree movement
o| workers, lncluolng researcbers, wblcb
coulo encourage more lnnovatlon.
"At present, buslness complalns tbat lt ls
ol||lcult to blre ano trans|er employees
wltbln tbe LU because o| tbe lack o| port-
ablllty o| penslon rlgbts ano ol||erences ln
soclal securlty systems. |n aooltlon, many
new Member States ano buslnesses crltl-
clse tbe oelays ln tbe |ree movement o|
workers |rom tbe new Member States, "
Ms Mlnor aoos.
Tanglble bene|lts!
"One message emerglng |rom tbe con-
sultatlon ls tbat consumers ano SMLs
oo not always |eel tanglble bene|lts |rom
tbe Slngle Market. Tbougb an
overwbelmlng majorlty con-
sloers tbe Slngle Market to be
a gooo tblng.
"Tbe bene|lts ln terms o| oe-
llverlng more growtb ano jobs
are clearly recognlseo, but
traoe unlons warneo us tbat
Slngle Market pollcles may
unoerllne tbe wel|are state,
ano tbus leao to lower publlc
ano prlvate consumptlon. Tbls
woulo, ln turn, leao to lower
growtb.
"Ano wbllst economlc
bene|lts are clearly
acknowleogeo, many
stakeboloers say tbat
tbe Slngle Market ls es-
sentlally a 'blg buslness
a||alr' ano call upon
tbe Commlsslon ano
Member States to en-
sure tbat tbe sltuatlon
o| small companles ano
consumers ls taken lnto account.
"Tbe consultatlon also sboweo tbat
varlous stakeboloers percelve tbe Slngle
Market as lacklng a su||lclent 'soclal bal-
ance'."
Future pollcy olrectlons
Altbougb tbere ls stlll mucb work to oo
on tbe oetalls o| tbe |uture pollcy, lt ls
becomlng clear, Ms Mlnor says, tbat tbe
maln lssues, tbat sboulo guloe our ap-
proacb, can be summarlseo ln tbe |lve C's:
completlon, consolloatlon, co-operatlon,
cbange ano communlcatlon.
"Completlon ls about tbe several gaps
tbat stlll bave to be |llleo to lmprove tbe
|unctlonlng o| tbe Slngle Market. 8ut we
sboulo not unoerestlmate wbat we bave
alreaoy got, wblcb leaos me to tbe secono
C, consolloatlon, wblcb baslcally means
tbat we wlll bave to |ocus on proper
transposltlon, lmplementatlon ano en-
|orcement o| LU-law.
"Co-operatlon means tbat tbe Slngle
Market slmply cannot |unctlon well, un-
less Member States ano tbe Commlsslon
are actlng ln concert ano work togetber.
Tbls slgnl|les tbat on tbe one bano tbe
Commlsslon bas to stano |lrm ln lts role
as Guarolan o| tbe Treatles, but lt ls vl-
tal to engage Member States ln a oeeper
partnersblp wblcb unoerllnes our sbareo
responslblllty |or maklng tbe Slngle Mar- rr
ket work better.
Tbe |ourtb C ls cbange. Tbe worlo ln
2006 ls a very ol||erent place |rom 1984
wben tbe Slngle Market project was |lrst
launcbeo. We neeo to aooress tbe cbal-
lenges o| globallsatlon, enlargement ano
an agelng populatlon.
"Last but not least tbe |l|tb C ls commu-
nlcatlon. All tbe above wlll be ln valn l| we
cannot succeeo ln re-connectlng cltlzens
to tbe project. We bave to communlcate
ano oemonstrate tbat tbe Slngle Market ls
oellverlng bene|lts to everyone. "
Tbe consultatlon unoertaken earller
tbls year ls ltsel| one o| tbe steps to-
waros acblevlng better communlcatlon,
sbe polnts out. "Slnce communlcatlon
bas to be a mutual tblng, lt ls |unoamen-
tal tbat we learn about tbe vlews o| tbe
stakeboloers."

[acquellne Mlnor, Dlrector o|
Horlzontal Pollcy Development:
"...tbe maln lssues, tbat sboulo
guloe our approacb, can be sum-
marlseo ln tbe |lve C's:
completlon, consolloatlon,
co-operatlon, cbange ano
communlcatlon."
"Tbere was a clear message tbat ln tbe area
o| servlces, retall |lnanclal servlces, ln tbe
banklng ano payment areas ano lntellectual
property, we bave to lmprove regulatlon."
N
o
43 Oc t obe r 2006
6
N
o
43 Oc t obe r 2006
7
Spotllgbt
Flve prlorlty areas
Tbe consultatlon oocument olscusseo
|lve posslble prlorlty areas o| attentlon
|or |uture Slngle Market pollcy.
Tbese were namely:
· Fosterlng market oynamlsm ano
lnnovatlon,
· better regulatlon,
· better lmplementatlon ano
en|orcement,
· taklng better account o| tbe global
conte×t ano
· lnvestlng more ln ln|ormatlon ano
communlcatlon about cltlzens' ano
buslnesses' rlgbts ano bene|lts ln tbe
Slngle Market.
Tbe responoents overwbelmlngly agreeo
wltb tbls cbolce o| prlorltles, sbe a||lrms.
"Tbere were strong
calls |or better com-
munlcatlon. Meanlng
tbat tbe Commlsslon
bas to oevelop a 'cul-
ture o| communlca-
tlon' ano to e||ectlvely
reacb out to cltlzens, lt
sboulo communlcate
on bene|lts ano poten-
tlal ano come up wltb
ways to reacb lnolvlo-
ual cltlzens ano small
buslnesses better.
"8ut a |alr number o|
tbose stakeboloers wbo replleo oo not
consloer tbese prlorltles su||lclent ano
call upon tbe Commlsslon to assume a
leao role ano provloe a clear, coberent
overall vlslon. Actlon ano guloance |rom
tbe Commlsslon was especlally oeemeo
necessary as regaros lmplementatlon ano
en|orcement. |t was also argueo tbat tbe
cooperatlon between natlonal autborl-
tles bas to be lmproveo ano lnoustry
complalneo tbat natlonal juoges are not
always well-equlppeo to banole Slngle
Market olsputes. |n|rlngement proceeo-
lngs sboulo be speeoeo up, more e||ectlve
ano |ocus on transposltlon problems."
|mpllcatlons |or |uture pollcy!
One message to emerge |rom tbe con-
sultatlon ls tbat stakeboloers belleve tbat
economlc analysls sboulo be lmproveo as
a base |or pollcy-maklng.
"Pollcy-maklng, tbey are telllng us, sboulo
not only mean 'more leglslatlon', but ln
oroer to be able to conouct souno eco-
nomlc analysls we sboulo to lncrease our
evloence-base. To tbls eno, lmpact assess-
ments sboulo be better coorolnateo ano
more objectlve. Tbe e||ect o| tbe pollcles
bas to be assesseo by means o| evalua-
tlon on a regular basls.
"Many responoents also tblnk tbat Mem-
ber States ougbt to be encourageo to
engage ln screenlng o| natlonal rules ano
regulatlons. 8ut we may also bave to re-
tblnk tbe cbolce o| lnstruments oepeno-
lng on tbe neeos o| tbe market. |n some
cases traoltlonal Slngle Market leglslatlon
may not be tbe best tool to open mar- rr
kets ano to ensure tbat all bene|lt. We
bave to look |or better synergles wltb
competltlon pollcy ano consloer more
|le×lble |orms o| leglslatlon.
"Anotber polnt we neeo to consloer ls
tbat wltbln tbe consultatlon consumers
ano traoe unlons askeo to be more ln-
volveo, so tbls ls also an lssue to be pur- rr
sueo wben tblnklng about tbe |uture."
Notlceable absences
Tbe results o| tbe consultatlon, sbe cau-
tlons, are not statlstlcally representatlve
oue to tbe open nature o| tbe proceoure.
Tbe report ls tbere|ore baslcally just a
summary account o| tbe responses wblcb
tbe Commlsslon bas recelveo. To tbls e×-
tent, any unoerlylng mlsunoerstanolngs
bave not been correcteo ano tbe vlews
o| tbe Commlsslon servlces are not e×-
presseo wltbln tbe oocument.
"8ut l| | bao to plck out one concern,
lt ls tbe lack o| partlclpatlon o| "clvll
soclety"|rom tbe new Member States.
|t woulo bave been a wonoer|ul oppor- rr
tunlty to learn about tbelr vlews on tbe
Slngle Market. |n tbls conte×t | can only
repeat tbat varlous new Member States
lnolcate ln tbelr replles tbat Slngle Mar- rr
ket pollcy sboulo take bet-
ter account o| tbe specl|lc
sltuatlon o| new Member
States. Probably tbls ls an
lssue tbat requlres a closer
look lnto."
*Tbe report on tbe consultatlon ano lnolvloual
replles are avallable at:
ln|o bttp://ec.europa.eu/lnternal_market/|lnances/|lm/lnoe×_en.btm
ln|o bttp:/ec.europa.eu/lnternal_market/strategy/lnoe×_en.btm
Publlc Hearlng on
Future Slngle Market Pollcy
Auoltorlum Natlonal 8ank o| 8elglum
29 November 2006
1BSU$BOZPVIFBSNF#SVTTFMT
Consultatlon: How can we reacb out to all stakeboloers ln tbe
Slngle Market!
Part 2: Do we have the right tooIkit!
8eyono leglslatlon: Sbaplng a success|ul, mooern Slngle Market
Pollcy tbat tackles market barrlers ano lne||lclencles
Part 3: Making what we have - work better
Ln|orcement ano problem-solvlng: How to grant cltlzens ano
|lrms e||ectlve Slngle Market rlgbts!
Part 4: Who knows the 5ingIe Market ~ who Iikes the 5ingIe
Market!
Communlcatlon: Wbat ls neeoeo to communlcate e||ectlvely on
tbe Slngle Market!
Peglstratlon oetalls at:
bttp://ec.europa.eu/lnternal_market/strategy/lnoe×_en.btm/bearlng
g
ln|o
Tom Dloerlcb
TLL: +32 (0)2.296 17 59
FAX: +32 (0)2.295 76 13
Markt-81@ec.europa.eu
Dl||erences between Member States re-
maln notlceable. Tbe sector ls lncreaslngly
organlseo on a cross-boroer as well as a
cross-sector basls but, |rom a customer
polnt o| vlew, lnsurance largely remalns
a 'oomestlc' servlce as retall lnsurance
markets are malnly, altbougb not e×clu-
slvely, accesseo tbrougb establlsbment.
Tbe potentlal |or |urtber oevelopment o|
tbe sector e×lsts but mucb oepenos on
economlc growtb ano cbanges ln leglsla-
tlon. Consloerlng tbe agelng o| tbe LU
populatlon ano tbe penslon cballenge, a
|urtber e×panslon can reasonably be e×-
pecteo.
|nvestment |uno sector
|nvestment |unos ln tbe Luropean Unlon
play an lmportant role ln bousebolos'
savlngs ano ln capltal markets. Tbey bave
been oeveloplng |ast |or tbe last ten years
÷ on average |aster tban tbe banklng sec-
tor ano tbe capltal market.
Overall, |unos bave more tban quaoru-
pleo tbelr assets unoer management to
come close to 6.4 trllllon euro at tbe eno
o| 2005.
Harmonlseo |unos oomlnate tbe market.
Data on cross-boroer actlvlty are ml×eo:
wblle |lgures |or cross-boroer consolloa-
T
be Luropean Unlon ls an lmportant
global |lnanclal player: lt represents
20° to 40° o| worlowloe |lnanclal actlv-
lty, oepenolng on tbe market segment.
Tbe 2006 Flnanclal |ntegratlon Monltor
publlsbeo by tbe Commlsslon bas put
tbe spotllgbt on tbe LU |lnanclal sector ln
tbe global conte×t ano on two slgnl|lcant
market segment: tbe LU lnsurance ano
penslon |unos sector ano LU lnvestment
|unos sector.
Tbe e×ternal olmenslon
Tbe F|M report lnolcates tbat tbe LU's
|lnanclal lntegratlon ln worlo markets bas
been lntensl|ylng over tbe perloo 1999-
2005.
Tbls may promote a better rlsk olstrlbu-
tlon but also creates potentlal cbannels
|or |lnanclal 'contaglon'. One e×ample ln
tbls conte×t ls tbe LU relnsurance sec-
tor, wbere Lurope ls a net recelver o| US
rlsks.
|nsurance ano penslon |uno sector
Tbe LU lnsurance ano penslon |uno sec-
tor bas been ano ls stlll growlng ln lmpor- rr
tance. |nvestments o| prlmary lnsurers
reacbeo 6 trllllon euro at tbe eno o| 2005
ano tbe assets unoer management o| LU
prlvate penslon |unos stooo at 2.5 trllllon
at tbe eno o| 2004.
Flnanclal markets
Flnanclal lntegratlon ln
worlo markets lntensl|les
Tbe latest monltorlng report |or tbe |lnanclal servlces sector sbows tbe ln-
creaslngly plvotal role tbat lnstltutlonal lnvestors play not only on LU |lnanclal
markets but also ln bullolng tbe savlngs ano retlrement provlslons o| LU cltlzens.
Tbe report also oemonstrates tbe lmportance o| tbe global olmenslon |or LU
|lnanclal markets.
tlon are low, most o| tbe new |unos are o|
a cross-boroer nature.
Data on |uno sales ln tbe LU suggest a
blgb scale o| cross-boroer olstrlbutlon.
However, tbls area ls wbere tbe lack o|
competltlon ls most |elt. New trenos ln
olstrlbutlon ln LU markets mlgbt contrlb-
ute to lntroouclng more competltlon to
tbe olstrlbutlon segment.
Flnanclal |ntegratlon Monltor 2006
Tbe F|M 2006 report ls tbe tblro annual
report complleo as a |ollow-up to tbe [uly
2000 request |rom tbe LU's Councll o|
Mlnlsters to oevelop lnolcators to assess
tbe state o| |lnanclal lntegratlon.
|n llne wltb lts commltment to better
regulatlon ano evloence-baseo pollcy
maklng, tbe monltorlng report sets out
to brlng economlc oata ano evloence lnto
tbe pollcy oebate.
ln|o
Krlstln vanoenbergen
TLL: +32 (0)2.299 43 11
FAX: +32 (0)2.295 55 42
Markt-G1@ec.europa.eu
N
o
43 Oc t obe r 2006
6
N
o
43 Oc t obe r 2006
7
Spotllgbt
Flve prlorlty areas
Tbe consultatlon oocument olscusseo
|lve posslble prlorlty areas o| attentlon
|or |uture Slngle Market pollcy.
Tbese were namely:
· Fosterlng market oynamlsm ano
lnnovatlon,
· better regulatlon,
· better lmplementatlon ano
en|orcement,
· taklng better account o| tbe global
conte×t ano
· lnvestlng more ln ln|ormatlon ano
communlcatlon about cltlzens' ano
buslnesses' rlgbts ano bene|lts ln tbe
Slngle Market.
Tbe responoents overwbelmlngly agreeo
wltb tbls cbolce o| prlorltles, sbe a||lrms.
"Tbere were strong
calls |or better com-
munlcatlon. Meanlng
tbat tbe Commlsslon
bas to oevelop a 'cul-
ture o| communlca-
tlon' ano to e||ectlvely
reacb out to cltlzens, lt
sboulo communlcate
on bene|lts ano poten-
tlal ano come up wltb
ways to reacb lnolvlo-
ual cltlzens ano small
buslnesses better.
"8ut a |alr number o|
tbose stakeboloers wbo replleo oo not
consloer tbese prlorltles su||lclent ano
call upon tbe Commlsslon to assume a
leao role ano provloe a clear, coberent
overall vlslon. Actlon ano guloance |rom
tbe Commlsslon was especlally oeemeo
necessary as regaros lmplementatlon ano
en|orcement. |t was also argueo tbat tbe
cooperatlon between natlonal autborl-
tles bas to be lmproveo ano lnoustry
complalneo tbat natlonal juoges are not
always well-equlppeo to banole Slngle
Market olsputes. |n|rlngement proceeo-
lngs sboulo be speeoeo up, more e||ectlve
ano |ocus on transposltlon problems."
|mpllcatlons |or |uture pollcy!
One message to emerge |rom tbe con-
sultatlon ls tbat stakeboloers belleve tbat
economlc analysls sboulo be lmproveo as
a base |or pollcy-maklng.
"Pollcy-maklng, tbey are telllng us, sboulo
not only mean 'more leglslatlon', but ln
oroer to be able to conouct souno eco-
nomlc analysls we sboulo to lncrease our
evloence-base. To tbls eno, lmpact assess-
ments sboulo be better coorolnateo ano
more objectlve. Tbe e||ect o| tbe pollcles
bas to be assesseo by means o| evalua-
tlon on a regular basls.
"Many responoents also tblnk tbat Mem-
ber States ougbt to be encourageo to
engage ln screenlng o| natlonal rules ano
regulatlons. 8ut we may also bave to re-
tblnk tbe cbolce o| lnstruments oepeno-
lng on tbe neeos o| tbe market. |n some
cases traoltlonal Slngle Market leglslatlon
may not be tbe best tool to open mar- rr
kets ano to ensure tbat all bene|lt. We
bave to look |or better synergles wltb
competltlon pollcy ano consloer more
|le×lble |orms o| leglslatlon.
"Anotber polnt we neeo to consloer ls
tbat wltbln tbe consultatlon consumers
ano traoe unlons askeo to be more ln-
volveo, so tbls ls also an lssue to be pur- rr
sueo wben tblnklng about tbe |uture."
Notlceable absences
Tbe results o| tbe consultatlon, sbe cau-
tlons, are not statlstlcally representatlve
oue to tbe open nature o| tbe proceoure.
Tbe report ls tbere|ore baslcally just a
summary account o| tbe responses wblcb
tbe Commlsslon bas recelveo. To tbls e×-
tent, any unoerlylng mlsunoerstanolngs
bave not been correcteo ano tbe vlews
o| tbe Commlsslon servlces are not e×-
presseo wltbln tbe oocument.
"8ut l| | bao to plck out one concern,
lt ls tbe lack o| partlclpatlon o| "clvll
soclety"|rom tbe new Member States.
|t woulo bave been a wonoer|ul oppor- rr
tunlty to learn about tbelr vlews on tbe
Slngle Market. |n tbls conte×t | can only
repeat tbat varlous new Member States
lnolcate ln tbelr replles tbat Slngle Mar- rr
ket pollcy sboulo take bet-
ter account o| tbe specl|lc
sltuatlon o| new Member
States. Probably tbls ls an
lssue tbat requlres a closer
look lnto."
*Tbe report on tbe consultatlon ano lnolvloual
replles are avallable at:
ln|o bttp://ec.europa.eu/lnternal_market/|lnances/|lm/lnoe×_en.btm
ln|o bttp:/ec.europa.eu/lnternal_market/strategy/lnoe×_en.btm
Publlc Hearlng on
Future Slngle Market Pollcy
Auoltorlum Natlonal 8ank o| 8elglum
29 November 2006
1BSU$BOZPVIFBSNF#SVTTFMT
Consultatlon: How can we reacb out to all stakeboloers ln tbe
Slngle Market!
Part 2: Do we have the right tooIkit!
8eyono leglslatlon: Sbaplng a success|ul, mooern Slngle Market
Pollcy tbat tackles market barrlers ano lne||lclencles
Part 3: Making what we have - work better
Ln|orcement ano problem-solvlng: How to grant cltlzens ano
|lrms e||ectlve Slngle Market rlgbts!
Part 4: Who knows the 5ingIe Market ~ who Iikes the 5ingIe
Market!
Communlcatlon: Wbat ls neeoeo to communlcate e||ectlvely on
tbe Slngle Market!
Peglstratlon oetalls at:
bttp://ec.europa.eu/lnternal_market/strategy/lnoe×_en.btm/bearlng
g
ln|o
Tom Dloerlcb
TLL: +32 (0)2.296 17 59
FAX: +32 (0)2.295 76 13
Markt-81@ec.europa.eu
Dl||erences between Member States re-
maln notlceable. Tbe sector ls lncreaslngly
organlseo on a cross-boroer as well as a
cross-sector basls but, |rom a customer
polnt o| vlew, lnsurance largely remalns
a 'oomestlc' servlce as retall lnsurance
markets are malnly, altbougb not e×clu-
slvely, accesseo tbrougb establlsbment.
Tbe potentlal |or |urtber oevelopment o|
tbe sector e×lsts but mucb oepenos on
economlc growtb ano cbanges ln leglsla-
tlon. Consloerlng tbe agelng o| tbe LU
populatlon ano tbe penslon cballenge, a
|urtber e×panslon can reasonably be e×-
pecteo.
|nvestment |uno sector
|nvestment |unos ln tbe Luropean Unlon
play an lmportant role ln bousebolos'
savlngs ano ln capltal markets. Tbey bave
been oeveloplng |ast |or tbe last ten years
÷ on average |aster tban tbe banklng sec-
tor ano tbe capltal market.
Overall, |unos bave more tban quaoru-
pleo tbelr assets unoer management to
come close to 6.4 trllllon euro at tbe eno
o| 2005.
Harmonlseo |unos oomlnate tbe market.
Data on cross-boroer actlvlty are ml×eo:
wblle |lgures |or cross-boroer consolloa-
T
be Luropean Unlon ls an lmportant
global |lnanclal player: lt represents
20° to 40° o| worlowloe |lnanclal actlv-
lty, oepenolng on tbe market segment.
Tbe 2006 Flnanclal |ntegratlon Monltor
publlsbeo by tbe Commlsslon bas put
tbe spotllgbt on tbe LU |lnanclal sector ln
tbe global conte×t ano on two slgnl|lcant
market segment: tbe LU lnsurance ano
penslon |unos sector ano LU lnvestment
|unos sector.
Tbe e×ternal olmenslon
Tbe F|M report lnolcates tbat tbe LU's
|lnanclal lntegratlon ln worlo markets bas
been lntensl|ylng over tbe perloo 1999-
2005.
Tbls may promote a better rlsk olstrlbu-
tlon but also creates potentlal cbannels
|or |lnanclal 'contaglon'. One e×ample ln
tbls conte×t ls tbe LU relnsurance sec-
tor, wbere Lurope ls a net recelver o| US
rlsks.
|nsurance ano penslon |uno sector
Tbe LU lnsurance ano penslon |uno sec-
tor bas been ano ls stlll growlng ln lmpor- rr
tance. |nvestments o| prlmary lnsurers
reacbeo 6 trllllon euro at tbe eno o| 2005
ano tbe assets unoer management o| LU
prlvate penslon |unos stooo at 2.5 trllllon
at tbe eno o| 2004.
Flnanclal markets
Flnanclal lntegratlon ln
worlo markets lntensl|les
Tbe latest monltorlng report |or tbe |lnanclal servlces sector sbows tbe ln-
creaslngly plvotal role tbat lnstltutlonal lnvestors play not only on LU |lnanclal
markets but also ln bullolng tbe savlngs ano retlrement provlslons o| LU cltlzens.
Tbe report also oemonstrates tbe lmportance o| tbe global olmenslon |or LU
|lnanclal markets.
tlon are low, most o| tbe new |unos are o|
a cross-boroer nature.
Data on |uno sales ln tbe LU suggest a
blgb scale o| cross-boroer olstrlbutlon.
However, tbls area ls wbere tbe lack o|
competltlon ls most |elt. New trenos ln
olstrlbutlon ln LU markets mlgbt contrlb-
ute to lntroouclng more competltlon to
tbe olstrlbutlon segment.
Flnanclal |ntegratlon Monltor 2006
Tbe F|M 2006 report ls tbe tblro annual
report complleo as a |ollow-up to tbe [uly
2000 request |rom tbe LU's Councll o|
Mlnlsters to oevelop lnolcators to assess
tbe state o| |lnanclal lntegratlon.
|n llne wltb lts commltment to better
regulatlon ano evloence-baseo pollcy
maklng, tbe monltorlng report sets out
to brlng economlc oata ano evloence lnto
tbe pollcy oebate.
ln|o
Krlstln vanoenbergen
TLL: +32 (0)2.299 43 11
FAX: +32 (0)2.295 55 42
Markt-G1@ec.europa.eu
N
o
43 Oc t obe r 2006
8
N
o
43 Oc t obe r 2006
9
· removes unjustlñeo barrlers to tbe
entrance o| new operators,
· strengtbens consumer protectlon,
lncluolng by e×tenolng manoatory
complalnts proceoures to all
operators ano tbe role o| natlonal
postal regulators.
|nternal Market ano Servlces Commls-
sloner Cbarlle McCreevy salo: "| |lrmly
belleve tbat completlng tbe |nternal Mar- rr
ket |or postal servlces ls vltal |or secur- rr
lng |urtber lmprovements ano |or sustaln-
lng tbe progress ano results acbleveo to
oate.
"|n preparlng tbe proposal, we bave put
consumer ano user neeos |lrst. Wltb |ull
market openlng ln 2009, we can look |or- rr
waro to more lnnovatlon, better servlces
ano lmproveo cost-e||lclency. Wltbout lt,
LU postal markets wlll be
lncreaslngly unable to meet
tbe cballenges o| tbe com-
munlcatlons revolutlon."
ln|o
bttp://ec.europa.eu/lnternal_market/post/lnoe×_en.btm
Postal servlces
tbe scope o| tbe reserveo area (lnltlally
mall unoer 350 grams, amenoeo ln 2002
to 100 grams ano reouceo on 1/1/2006
to 50 grams).
Tbe 1997 Dlrectlve almeo at ensurlng tbe
best posslble servlce tbrougb a graoual
openlng o| tbe market, wltb a |lnal target
set ln 2002 |or |ull openlng ln 2009.
|t lncluoes a requlrement tbat tbe Com-
mlsslon sboulo provloe perloolc reports
on lts lmplementatlon, ano, be|ore tbe
eno o| 2006, con|lrm wbetber tbe 2009
oate remalneo approprlate. Tbe Com-
mlsslon ls now proposlng, by means o| a
|urtber amenolng Dlrectlve, tbat tbe oate
sboulo be con|lrmeo.
Lncouraglng progress
A number o| Member States bave alreaoy
openeo up tbelr market to |ull competl-
tlon or bave |lrm plans to oo so be|ore
tbe 2009 target oate.
Tbe Commlsslon's latest appllcatlon
report polnts to a posltlve recoro o|
acblevement (as was also con|lrmeo re-
cently by tbe Luropean Parllament).
|t |lnos tbat tbere bas been a substantlal
ano measurable lmprovement ln tbe qual-
lty o| postal servlces, lncluolng ln speeo
ano rellablllty.
|t |lnos tbat all Member States' Unlversal
Servlce Provloers provloe a servlce tbat
ls conslstent wltb or tbat e×ceeos tbe
mlnlmum stanoaros requlreo.
Key lssues
Tbe proposeo new Dlrectlve:
· removes tbe concept o| 'reservable
areas' ano conñrms tbat tbe market
sboulo be |ully open to competltlon
by 2009,
· malntalns tbe maln provlslons o| tbe
e×lstlng Postal Dlrectlve, lncluolng
tbe unlversal servlce obllgatlon
regarolng servlces tbat must be
provloeo (letters ano parcels) ano
stanoaros wblcb must be met,
· o||ers Member States a menu
o| alternatlve means otber tban
tbrougb a monopoly to ñnance
unlversal servlce provlslon ln tbls
new conte×t, ano o||ers greater
Ne×lblllty/clarlty on bow lt can be
acbleveo. |t ls |or Member States to
oecloe wblcb mooel best sults tbelr
neeos (tbe optlons provloeo |or
lncluoe, |or e×ample, state alos, publlc
procurement, compensatlon |unos,
cost sbarlng etc.) ,
· provloes |or retentlon o| unl|orm
tarl||s (l.e. tarl||s wblcb are equal
lrrespectlve o| tbe locatlon o| tbe
aooressee) |or consumer/slngle-plece
mall or |or publlc pollcy reasons,
but restrlcts tbelr use ln otber
clrcumstances,
ln|o
Peter Curran
TLL: +32 (0)2.296 09 28
FAX: +32 (0)2.296 83 92
Markt-L4@ec.europa.eu

"Tbe proposal malntalns tbe
current obllgatlons on Member
States to ensure a blgb-quallty
unlversal servlce comprlslng at
least one oellvery ano collectlon
|lve oays a week |or every LU
cltlzen."
Commlsslon proposes
|ull market openlng o|
T
be Commlsslon proposal to lntro-
ouce |ull market openlng ln 2009
wlll mean tbat natlonal operators wlll no
longer bave a monopoly on mall below a
certaln welgbt (currently a ma×lmum o|
50 grams), known as tbe 'reserveo area'.
Member States wlll be alloweo a |le×-
lble cbolce o| means otber tban tbrougb
a monopoly to |lnance unlversal servlce
provlslon or tbe posslblllty to sbare out
tbe unlversal servlce obllgatlon between
operators.
Tbe proposal provloes |urtber clarl|lca-
tlon on bow tbls can be acbleveo. Tbe
proposeo new Dlrectlve ls tbe |lnal step
ln a long re|orm process tbat bas alreaoy
seen large areas o| LU postal markets
openeo to competltlon, wltb very posl-
tlve results.
Postal servlces
Malntalnlng unlversal servlce
Tbe proposal malntalns tbe current ob-
llgatlons on Member States to ensure a
blgb-quallty unlversal servlce comprlslng
at least one oellvery ano collectlon |lve
oays a week |or every LU cltlzen.
|t wlll also |urtber reln|orce consumer
protectlon ano lncrease tbe role o| na-
tlonal regulatory autborltles. Tbe obll-
gatlon to ensure a||oroablllty o| postal
servlces ls malntalneo ln tbe proposal, as
ls tbe posslblllty |or Member States to
lmpose a unl|orm tarl|| |or slngle plece
tarl|| ltems sucb as consumer mall.
|n tbe event tbat remalnlng net costs o|
provlolng unlversal servlce neeo to be
covereo, Member States wlll be able to
cboose |rom a range o| optlons, lncluo-
lng, |or e×ample, state
alos, publlc procure-
ment, compensatlon
|unos ano cost sbarlng.
|t wlll be |or Member
States to oecloe wblcb
mooel best sults tbelr
neeos.
8ene|lts
Wltb tbe removal o|
reserveo areas, users
o| postal servlces can
e×pect tbe servlces
avallable to tbem to
oevelop ano |urtber lmprove.
Unlversal servlce provloers wlll be mo-
tlvateo to become more rellable ano
e||lclent ano to |urtber lncrease tbelr
customer |ocus ln tbe llgbt o| potentlal
competltlon |rom new market entrants.
Full market openlng wlll also olrectly
|oster tbe creatlon o| new jobs ln new
postal companles, ano, lnolrectly, ln tbe
lnoustrles oepenoent on tbe postal sec-
tor.
Pegulatory |ramework
Postal Servlces ln tbe LU are covereo
by tbe 1997 Postal Dlrectlve (97/67/
LC) as amenoeo by tbe 2002 Dlrectlve
(2002/39/LC). Tbls createo a regulatory
|ramework wblcb guarantees cltlzens a
unlversal servlce, wblle graoually llmltlng
Tbe Commlsslon bas put |orwaro a proposal to open LU post-
al markets |ully to competltlon by 2009, ln llne wltb tbe agreeo
target oate set out ln tbe current Postal Dlrectlve. On tbe
basls o| e×tenslve researcb ano consultatlon, tbe Commlsslon
belleves tbat tbls ls tbe best way to malntaln unlversal servlce
wblle |urtber lmprovlng quallty ano cbolce |or LU consumers
ano buslnesses.

"Full market openlng ln 2009 wlll
mean tbat natlonal
operators wlll no longer bave
a monopoly on mall below a
certaln welgbt... known as tbe
reserveo area."
postal markets by 2009
N
o
43 Oc t obe r 2006
8
N
o
43 Oc t obe r 2006
9
· removes unjustlñeo barrlers to tbe
entrance o| new operators,
· strengtbens consumer protectlon,
lncluolng by e×tenolng manoatory
complalnts proceoures to all
operators ano tbe role o| natlonal
postal regulators.
|nternal Market ano Servlces Commls-
sloner Cbarlle McCreevy salo: "| |lrmly
belleve tbat completlng tbe |nternal Mar- rr
ket |or postal servlces ls vltal |or secur- rr
lng |urtber lmprovements ano |or sustaln-
lng tbe progress ano results acbleveo to
oate.
"|n preparlng tbe proposal, we bave put
consumer ano user neeos |lrst. Wltb |ull
market openlng ln 2009, we can look |or- rr
waro to more lnnovatlon, better servlces
ano lmproveo cost-e||lclency. Wltbout lt,
LU postal markets wlll be
lncreaslngly unable to meet
tbe cballenges o| tbe com-
munlcatlons revolutlon."
ln|o
bttp://ec.europa.eu/lnternal_market/post/lnoe×_en.btm
Postal servlces
tbe scope o| tbe reserveo area (lnltlally
mall unoer 350 grams, amenoeo ln 2002
to 100 grams ano reouceo on 1/1/2006
to 50 grams).
Tbe 1997 Dlrectlve almeo at ensurlng tbe
best posslble servlce tbrougb a graoual
openlng o| tbe market, wltb a |lnal target
set ln 2002 |or |ull openlng ln 2009.
|t lncluoes a requlrement tbat tbe Com-
mlsslon sboulo provloe perloolc reports
on lts lmplementatlon, ano, be|ore tbe
eno o| 2006, con|lrm wbetber tbe 2009
oate remalneo approprlate. Tbe Com-
mlsslon ls now proposlng, by means o| a
|urtber amenolng Dlrectlve, tbat tbe oate
sboulo be con|lrmeo.
Lncouraglng progress
A number o| Member States bave alreaoy
openeo up tbelr market to |ull competl-
tlon or bave |lrm plans to oo so be|ore
tbe 2009 target oate.
Tbe Commlsslon's latest appllcatlon
report polnts to a posltlve recoro o|
acblevement (as was also con|lrmeo re-
cently by tbe Luropean Parllament).
|t |lnos tbat tbere bas been a substantlal
ano measurable lmprovement ln tbe qual-
lty o| postal servlces, lncluolng ln speeo
ano rellablllty.
|t |lnos tbat all Member States' Unlversal
Servlce Provloers provloe a servlce tbat
ls conslstent wltb or tbat e×ceeos tbe
mlnlmum stanoaros requlreo.
Key lssues
Tbe proposeo new Dlrectlve:
· removes tbe concept o| 'reservable
areas' ano conñrms tbat tbe market
sboulo be |ully open to competltlon
by 2009,
· malntalns tbe maln provlslons o| tbe
e×lstlng Postal Dlrectlve, lncluolng
tbe unlversal servlce obllgatlon
regarolng servlces tbat must be
provloeo (letters ano parcels) ano
stanoaros wblcb must be met,
· o||ers Member States a menu
o| alternatlve means otber tban
tbrougb a monopoly to ñnance
unlversal servlce provlslon ln tbls
new conte×t, ano o||ers greater
Ne×lblllty/clarlty on bow lt can be
acbleveo. |t ls |or Member States to
oecloe wblcb mooel best sults tbelr
neeos (tbe optlons provloeo |or
lncluoe, |or e×ample, state alos, publlc
procurement, compensatlon |unos,
cost sbarlng etc.) ,
· provloes |or retentlon o| unl|orm
tarl||s (l.e. tarl||s wblcb are equal
lrrespectlve o| tbe locatlon o| tbe
aooressee) |or consumer/slngle-plece
mall or |or publlc pollcy reasons,
but restrlcts tbelr use ln otber
clrcumstances,
ln|o
Peter Curran
TLL: +32 (0)2.296 09 28
FAX: +32 (0)2.296 83 92
Markt-L4@ec.europa.eu

"Tbe proposal malntalns tbe
current obllgatlons on Member
States to ensure a blgb-quallty
unlversal servlce comprlslng at
least one oellvery ano collectlon
|lve oays a week |or every LU
cltlzen."
Commlsslon proposes
|ull market openlng o|
T
be Commlsslon proposal to lntro-
ouce |ull market openlng ln 2009
wlll mean tbat natlonal operators wlll no
longer bave a monopoly on mall below a
certaln welgbt (currently a ma×lmum o|
50 grams), known as tbe 'reserveo area'.
Member States wlll be alloweo a |le×-
lble cbolce o| means otber tban tbrougb
a monopoly to |lnance unlversal servlce
provlslon or tbe posslblllty to sbare out
tbe unlversal servlce obllgatlon between
operators.
Tbe proposal provloes |urtber clarl|lca-
tlon on bow tbls can be acbleveo. Tbe
proposeo new Dlrectlve ls tbe |lnal step
ln a long re|orm process tbat bas alreaoy
seen large areas o| LU postal markets
openeo to competltlon, wltb very posl-
tlve results.
Postal servlces
Malntalnlng unlversal servlce
Tbe proposal malntalns tbe current ob-
llgatlons on Member States to ensure a
blgb-quallty unlversal servlce comprlslng
at least one oellvery ano collectlon |lve
oays a week |or every LU cltlzen.
|t wlll also |urtber reln|orce consumer
protectlon ano lncrease tbe role o| na-
tlonal regulatory autborltles. Tbe obll-
gatlon to ensure a||oroablllty o| postal
servlces ls malntalneo ln tbe proposal, as
ls tbe posslblllty |or Member States to
lmpose a unl|orm tarl|| |or slngle plece
tarl|| ltems sucb as consumer mall.
|n tbe event tbat remalnlng net costs o|
provlolng unlversal servlce neeo to be
covereo, Member States wlll be able to
cboose |rom a range o| optlons, lncluo-
lng, |or e×ample, state
alos, publlc procure-
ment, compensatlon
|unos ano cost sbarlng.
|t wlll be |or Member
States to oecloe wblcb
mooel best sults tbelr
neeos.
8ene|lts
Wltb tbe removal o|
reserveo areas, users
o| postal servlces can
e×pect tbe servlces
avallable to tbem to
oevelop ano |urtber lmprove.
Unlversal servlce provloers wlll be mo-
tlvateo to become more rellable ano
e||lclent ano to |urtber lncrease tbelr
customer |ocus ln tbe llgbt o| potentlal
competltlon |rom new market entrants.
Full market openlng wlll also olrectly
|oster tbe creatlon o| new jobs ln new
postal companles, ano, lnolrectly, ln tbe
lnoustrles oepenoent on tbe postal sec-
tor.
Pegulatory |ramework
Postal Servlces ln tbe LU are covereo
by tbe 1997 Postal Dlrectlve (97/67/
LC) as amenoeo by tbe 2002 Dlrectlve
(2002/39/LC). Tbls createo a regulatory
|ramework wblcb guarantees cltlzens a
unlversal servlce, wblle graoually llmltlng
Tbe Commlsslon bas put |orwaro a proposal to open LU post-
al markets |ully to competltlon by 2009, ln llne wltb tbe agreeo
target oate set out ln tbe current Postal Dlrectlve. On tbe
basls o| e×tenslve researcb ano consultatlon, tbe Commlsslon
belleves tbat tbls ls tbe best way to malntaln unlversal servlce
wblle |urtber lmprovlng quallty ano cbolce |or LU consumers
ano buslnesses.

"Full market openlng ln 2009 wlll
mean tbat natlonal
operators wlll no longer bave
a monopoly on mall below a
certaln welgbt... known as tbe
reserveo area."
postal markets by 2009
N
o
43 Oc t obe r 2006
10

S p e c l a l
F e a t u r e
8ullolng on tbe |SD
MlF|D ls tbe most slgnl|lcant LU leglslatlon |or a oecaoe oeal-
lng wltb lnvestment lntermeolarles ano |lnanclal markets ano
wlll replace tbe e×lstlng |nvestment Servlces Dlrectlve (|SD)
aoopteo ln 1993. 8ullolng on tbe |SD's baslc blgb-level pro-
vlslons governlng tbe organlsatlon ano conouct o| busl-
ness, MlF|D makes slgnl|lcant cbanges to tbe regulatory
|ramework to re|lect oevelopments ln |lnanclal servlces
ano markets slnce tbe |SD was lmplementeo.
|t wloens tbe range o| 'core' lnvestment servlces ano ac-
tlvltles tbat can be traoeo provloeo uslng tbe LU lnvest-
ment servlces 'passport'. |t lntroouces tbe operatlon o| a
multllateral traolng |aclllty (MTF) as a new core lnvestment
servlce covereo by tbe passport, upgraoes lnvestment ao-
vlce to a core servlce (tbls was only an anclllary servlce
unoer tbe |SD) ano e×tenos tbe scope o| tbe passport to
cover commoolty oerlvatlves, creolt oerlvatlves ano |lnan-
clal Contracts |or Dl||erences (CFDs) |or tbe |lrst tlme.
Flrms covereo by MlF|D wlll
be autborlseo ano regulateo
ln tbelr bome state (broaoly,
tbe country ln wblcb are
reglstereo). Once a |lrm bas
been autborlseo, lt wlll be
able to use tbe MlF|D pass-
port to provloe servlces to
customers ln otber LU Mem-
ber States. |t lmproves tbe
operatlon o| tbe passport
|or lnvestment |lrms. Tbe
scope |or sbareo supervl-
slon between bome ano bost
Member State bas been orastlcally reouceo tbougb tbe bost
Member State malntalns some llmlteo competences, malnly
wltb respect to tbe supervlslon o| passporteo brancbes .
|t also clarl|les some o| tbe jurlsolctlonal uncertalntles tbat
arose unoer tbe |SD.
Oc t obe r 200 6
|n November 2007, a major plece o| |lnanclal servlces leg-
lslatlon wlll come lnto |orce |urtber oeveloplng tbe |rame-
work o| a slngle market ln tbe LU |or traolng ln sbares,
bonos, oerlvatlves ano otber lnvestment prooucts. Mem-
ber States are obllgeo to aoopt tbe necessary leglslatlon
transposlng tbls new |ramework alreaoy by [anuary 2007.
Known as tbe 'MlF|D' - tbe Markets ln Flnanclal |nstru-
ments Dlrectlve - lt contalns measures wblcb wlll lncrease
lnvestor protectlon, cbange
ano lmprove tbe organlsa-
tlon ano |unctlonlng o| ln-
vestment |lrms, |acllltate
cross-boroer traolng ln se-
curltles, ano stlmulate tbe
|urtber lntegratlon o| LU
capltal markets.
Creatlng a slngle LU-wloe
market |or |lnanclal servlc-
es ls tbe overrlolng objec-
tlve o| tbe Commlsslon's
Flnanclal Servlces Actlon
Plan (FSAP) ano tbe MlF|D
eglslatlon ls a key element.
ts objectlve ls to enable
nvestors to operate more
easlly ano wltb |ull con|loence across LU boroers ano to
remove obstacles to tbe use o| tbe LU lnvestment serv-
lces 'passport'.
Tbe new measures set out to stlmulate greater competl-
tlon ano establlsb a level playlng |lelo between Lurope's
securltles traolng venues ano create a robust, common
regulatory |ramework |or traolng ln tbe |lnanclal prooucts
o||ereo by Lurope's securltles markets. At tbe same tlme,
tbe MlF|D provlslons wlll ensure strong lnvestor protectlon
wltb, INTER ALIA, a comprebenslve set o| rules governlng tbe
relatlonsblp wblcb lnvestment |lrms bave wltb tbelr cllents.
11
"Tbe MlF|D ... wlll cbange
ano lmprove tbe organl-
satlon ano |unctlonlng o|
lnvestment |lrms, |acllltate
cross-boroer traolng ln
securltles, ano stlmulate
tbe |urtber lntegratlon o|
LU capltal markets"
Mergers ano acqulsltlon
urrent LU rules allow supervlsory
autborltles to block proposeo M&A
l| tbey consloer tbat tbe 'souno ano pru-
oent management' o| tbe target company
coulo be put at rlsk. Tbe proposeo new
Dlrectlve, wblcb amenos varlous e×lstlng
Dlrectlves ln tbese sectors, wlll ln par- rr
tlcular clarl|y tbe crlterla agalnst wblcb
supervlsors sboulo assess posslble M&A
operatlons. Tbls wlll lmprove clarlty ano
transparency ln supervlsory assessment
ano belp to ensure a conslstent banollng
o| M&A requests across tbe LU.
Clear ano transparent process
Tbe proposeo Dlrectlve provloes super- rr
vlsory autborltles wltb a clear ano trans-
parent process |or oeclslon-maklng ano
notl|lcatlon.
|n partlcular, tbere ls now a closeo llst o|
crlterla on wblcb tbe acqulrlng company
sboulo be assesseo, sucb as reputatlon
o| tbe proposeo acqulrer, reputatlon ano
e×perlence o| any person tbat may run
tbe resultlng lnstltutlon or |lrm, |lnan-
clal sounoness o| tbe proposeo acqulrer,
compllance wltb relevant LU Dlrectlves,
ano rlsk o| money launoerlng ano terror- rr
lsm |lnanclng.
Tbe Dlrectlve also reouces tbe assess-
ment perloo |rom tbree montbs to 30
oays ano allows tbe supervlsory autbor- rr
lty to 'stop tbe clock' only once, unoer
clear conoltlons.
|t amenos tbe |ollowlng e×lstlng Dlrec-
tlves: tbe 8anklng Dlrectlve (2006/48/LC),
tbe Tblro Non-ll|e |nsurance Dlrectlve
(92/49/LLC), tbe Pecast Ll|e Assurance
Dlrectlve (2002/83/LC), tbe Pelnsurance
Dlrectlve (2005/68/LC), ano Dlrectlve
2006/48/LC on markets ln |lnanclal ln-
struments.
Problems wltb approval process
Tbe lssue o| low cross-boroer consolloa-
tlon ln tbe |lnanclal sector was olscusseo
at tbe ln|ormal meetlng o| Lconomlc ano
Flnance Mlnlsters (LCOF|N) ln Septem-
ber 2004. Mlnlsters askeo tbe Commls-
slon to stuoy posslble obstacles to cross-
boroer mergers ano acqulsltlons ln tbe
|lnanclal sector, arlslng botb |rom ol||er- rr
lng supervlsory practlces ano |rom otber,
broaoer |actors.
Consequently, tbe Commlsslon began a
revlew o| tbe e×lstlng rules ln tbe banklng
sector on tbe supervlsory assessments o|
sbarebololngs tbat allow Member States
to block on pruoentlal grounos tbe ac-
qulsltlon o| sbarebololngs above certaln
tbresbolos.
As tbls leglslatlon ls very slmllar to cor- rr
responolng leglslatlon ln tbe securltles
ano lnsurance sectors, lt was consloereo
approprlate to e×teno tbe revlew to ln-
Commlsslon acts to
lmprove M&A supervlsory
approval process
Tbe Commlsslon bas put |orwaro a proposal tbat wlll tlgbten tbe
proceoures tbat Member States' supervlsory autborltles bave to
|ollow wben assesslng proposeo mergers ano acqulsltlons (M&A)
ln tbe banklng, lnsurance ano securltles sectors.

cluoe tbese sectors as well, to malntaln
ano enbance |urtber cross-sectoral con-
slstency.
To gatber stakeboloers' vlew on tbe sub-
ject, tbe Commlsslon carrleo out an on-
llne consultatlon ln sprlng 2006. Tbe re-
sults lnolcateo tbat LU companles were
aware o| tbe problems wltb tbe super- rr
vlsory approval process, ano were sup-
portlve o| tbe neeo to lntroouce clearer
proceoures ano crlterla ano to lmprove
conslstency.
|nternal Market ano Servlces Commls-
sloner Cbarlle McCreevy salo: "Tbese
new rules mean tbat supervlsory autbor- rr
ltles wlll bave to be clear, transparent ano
conslstent wben assesslng cross-boroer
mergers ano acqulsltlons. Tbey leave no
room |or polltlcal lnter|erence or pro-
tectlonlsm.
"Tbls bas to be tbe way |orwaro l| we're
serlous about bavlng a |ully |unctlonlng
|nternal Market ano enabllng Lurope's |l-
nanclal companles to compete globally."
ln|o
bttp://ec.europa.eu/lnternal_market/ñnances/cross-sector/lnoe×_en.btm/obstacles
MlF|D wlll eno tbe monopoly
wblcb certaln stock e×cbanges
bave bao on tbe traolng o|
securltles.
N
o
43 Oc t obe r 2006
10

S p e c l a l
F e a t u r e
8ullolng on tbe |SD
MlF|D ls tbe most slgnl|lcant LU leglslatlon |or a oecaoe oeal-
lng wltb lnvestment lntermeolarles ano |lnanclal markets ano
wlll replace tbe e×lstlng |nvestment Servlces Dlrectlve (|SD)
aoopteo ln 1993. 8ullolng on tbe |SD's baslc blgb-level pro-
vlslons governlng tbe organlsatlon ano conouct o| busl-
ness, MlF|D makes slgnl|lcant cbanges to tbe regulatory
|ramework to re|lect oevelopments ln |lnanclal servlces
ano markets slnce tbe |SD was lmplementeo.
|t wloens tbe range o| 'core' lnvestment servlces ano ac-
tlvltles tbat can be traoeo provloeo uslng tbe LU lnvest-
ment servlces 'passport'. |t lntroouces tbe operatlon o| a
multllateral traolng |aclllty (MTF) as a new core lnvestment
servlce covereo by tbe passport, upgraoes lnvestment ao-
vlce to a core servlce (tbls was only an anclllary servlce
unoer tbe |SD) ano e×tenos tbe scope o| tbe passport to
cover commoolty oerlvatlves, creolt oerlvatlves ano |lnan-
clal Contracts |or Dl||erences (CFDs) |or tbe |lrst tlme.
Flrms covereo by MlF|D wlll
be autborlseo ano regulateo
ln tbelr bome state (broaoly,
tbe country ln wblcb are
reglstereo). Once a |lrm bas
been autborlseo, lt wlll be
able to use tbe MlF|D pass-
port to provloe servlces to
customers ln otber LU Mem-
ber States. |t lmproves tbe
operatlon o| tbe passport
|or lnvestment |lrms. Tbe
scope |or sbareo supervl-
slon between bome ano bost
Member State bas been orastlcally reouceo tbougb tbe bost
Member State malntalns some llmlteo competences, malnly
wltb respect to tbe supervlslon o| passporteo brancbes .
|t also clarl|les some o| tbe jurlsolctlonal uncertalntles tbat
arose unoer tbe |SD.
Oc t obe r 200 6
|n November 2007, a major plece o| |lnanclal servlces leg-
lslatlon wlll come lnto |orce |urtber oeveloplng tbe |rame-
work o| a slngle market ln tbe LU |or traolng ln sbares,
bonos, oerlvatlves ano otber lnvestment prooucts. Mem-
ber States are obllgeo to aoopt tbe necessary leglslatlon
transposlng tbls new |ramework alreaoy by [anuary 2007.
Known as tbe 'MlF|D' - tbe Markets ln Flnanclal |nstru-
ments Dlrectlve - lt contalns measures wblcb wlll lncrease
lnvestor protectlon, cbange
ano lmprove tbe organlsa-
tlon ano |unctlonlng o| ln-
vestment |lrms, |acllltate
cross-boroer traolng ln se-
curltles, ano stlmulate tbe
|urtber lntegratlon o| LU
capltal markets.
Creatlng a slngle LU-wloe
market |or |lnanclal servlc-
es ls tbe overrlolng objec-
tlve o| tbe Commlsslon's
Flnanclal Servlces Actlon
Plan (FSAP) ano tbe MlF|D
eglslatlon ls a key element.
ts objectlve ls to enable
nvestors to operate more
easlly ano wltb |ull con|loence across LU boroers ano to
remove obstacles to tbe use o| tbe LU lnvestment serv-
lces 'passport'.
Tbe new measures set out to stlmulate greater competl-
tlon ano establlsb a level playlng |lelo between Lurope's
securltles traolng venues ano create a robust, common
regulatory |ramework |or traolng ln tbe |lnanclal prooucts
o||ereo by Lurope's securltles markets. At tbe same tlme,
tbe MlF|D provlslons wlll ensure strong lnvestor protectlon
wltb, INTER ALIA, a comprebenslve set o| rules governlng tbe
relatlonsblp wblcb lnvestment |lrms bave wltb tbelr cllents.
11
"Tbe MlF|D ... wlll cbange
ano lmprove tbe organl-
satlon ano |unctlonlng o|
lnvestment |lrms, |acllltate
cross-boroer traolng ln
securltles, ano stlmulate
tbe |urtber lntegratlon o|
LU capltal markets"
Mergers ano acqulsltlon
urrent LU rules allow supervlsory
autborltles to block proposeo M&A
l| tbey consloer tbat tbe 'souno ano pru-
oent management' o| tbe target company
coulo be put at rlsk. Tbe proposeo new
Dlrectlve, wblcb amenos varlous e×lstlng
Dlrectlves ln tbese sectors, wlll ln par- rr
tlcular clarl|y tbe crlterla agalnst wblcb
supervlsors sboulo assess posslble M&A
operatlons. Tbls wlll lmprove clarlty ano
transparency ln supervlsory assessment
ano belp to ensure a conslstent banollng
o| M&A requests across tbe LU.
Clear ano transparent process
Tbe proposeo Dlrectlve provloes super- rr
vlsory autborltles wltb a clear ano trans-
parent process |or oeclslon-maklng ano
notl|lcatlon.
|n partlcular, tbere ls now a closeo llst o|
crlterla on wblcb tbe acqulrlng company
sboulo be assesseo, sucb as reputatlon
o| tbe proposeo acqulrer, reputatlon ano
e×perlence o| any person tbat may run
tbe resultlng lnstltutlon or |lrm, |lnan-
clal sounoness o| tbe proposeo acqulrer,
compllance wltb relevant LU Dlrectlves,
ano rlsk o| money launoerlng ano terror- rr
lsm |lnanclng.
Tbe Dlrectlve also reouces tbe assess-
ment perloo |rom tbree montbs to 30
oays ano allows tbe supervlsory autbor- rr
lty to 'stop tbe clock' only once, unoer
clear conoltlons.
|t amenos tbe |ollowlng e×lstlng Dlrec-
tlves: tbe 8anklng Dlrectlve (2006/48/LC),
tbe Tblro Non-ll|e |nsurance Dlrectlve
(92/49/LLC), tbe Pecast Ll|e Assurance
Dlrectlve (2002/83/LC), tbe Pelnsurance
Dlrectlve (2005/68/LC), ano Dlrectlve
2006/48/LC on markets ln |lnanclal ln-
struments.
Problems wltb approval process
Tbe lssue o| low cross-boroer consolloa-
tlon ln tbe |lnanclal sector was olscusseo
at tbe ln|ormal meetlng o| Lconomlc ano
Flnance Mlnlsters (LCOF|N) ln Septem-
ber 2004. Mlnlsters askeo tbe Commls-
slon to stuoy posslble obstacles to cross-
boroer mergers ano acqulsltlons ln tbe
|lnanclal sector, arlslng botb |rom ol||er- rr
lng supervlsory practlces ano |rom otber,
broaoer |actors.
Consequently, tbe Commlsslon began a
revlew o| tbe e×lstlng rules ln tbe banklng
sector on tbe supervlsory assessments o|
sbarebololngs tbat allow Member States
to block on pruoentlal grounos tbe ac-
qulsltlon o| sbarebololngs above certaln
tbresbolos.
As tbls leglslatlon ls very slmllar to cor- rr
responolng leglslatlon ln tbe securltles
ano lnsurance sectors, lt was consloereo
approprlate to e×teno tbe revlew to ln-
Commlsslon acts to
lmprove M&A supervlsory
approval process
Tbe Commlsslon bas put |orwaro a proposal tbat wlll tlgbten tbe
proceoures tbat Member States' supervlsory autborltles bave to
|ollow wben assesslng proposeo mergers ano acqulsltlons (M&A)
ln tbe banklng, lnsurance ano securltles sectors.

cluoe tbese sectors as well, to malntaln
ano enbance |urtber cross-sectoral con-
slstency.
To gatber stakeboloers' vlew on tbe sub-
ject, tbe Commlsslon carrleo out an on-
llne consultatlon ln sprlng 2006. Tbe re-
sults lnolcateo tbat LU companles were
aware o| tbe problems wltb tbe super- rr
vlsory approval process, ano were sup-
portlve o| tbe neeo to lntroouce clearer
proceoures ano crlterla ano to lmprove
conslstency.
|nternal Market ano Servlces Commls-
sloner Cbarlle McCreevy salo: "Tbese
new rules mean tbat supervlsory autbor- rr
ltles wlll bave to be clear, transparent ano
conslstent wben assesslng cross-boroer
mergers ano acqulsltlons. Tbey leave no
room |or polltlcal lnter|erence or pro-
tectlonlsm.
"Tbls bas to be tbe way |orwaro l| we're
serlous about bavlng a |ully |unctlonlng
|nternal Market ano enabllng Lurope's |l-
nanclal companles to compete globally."
ln|o
bttp://ec.europa.eu/lnternal_market/ñnances/cross-sector/lnoe×_en.btm/obstacles
MlF|D wlll eno tbe monopoly
wblcb certaln stock e×cbanges
bave bao on tbe traolng o|
securltles.
N
o
43 Oc t obe r 2006
12
N
o
43 Oc t obe r 2006
13
13
-
tltlon |rom multllateral traolng |acllltles (MTFs), l.e. broaoly
non-e×cbange traolng plat|orms ano 'systematlc lnternalls-
ers', l.e. banks or lnvestment |lrms wbo systematlcally e×-
ecute cllent oroers lnternally on own account.
MTFs ano 'systematlc lnternallsers' wlll be subject to slml-
lar pre- ano post-traoe transparency requlrements as tbe
e×cbanges. Tbls wlll ensure a level playlng |lelo between tbe
e×cbanges ano tbelr new competltors ÷ ano |ull ln|ormatlon
on traolng actlvlty to tbe market.
Catalyst |or cbange
MlF|D ls alreaoy actlng as a catalyst |or slgnl|lcant market
cbanges. Many e×cbanges, multllateral traolng |acllltles ano
lnvestment |lrms are posl-
tlonlng tbemselves ln an-
tlclpatlon o| tbe mucb more
competltlve conoltlons
wblcb tbe MlF|D wlll create.
New servlces are alreaoy
ln oevelopment. Tbe traolng
plat|orm orlglnally bullt |or
tbe LASDAO ano NASDAO
Lurope pan-Luropean e×-
cbanges, |or e×ample, ls cur- rr
rently belng oevelopeo lnto a
|ully MlF|D compllant traolng
plat|orm.
"Tbrougb tbe plat|orm, we bave oevelopeo, organlsatlons
wlll be able to use a slngle pan-Luropean e×cbange - ratber
tban bavlng to traoe ln all 29 natlonal e×cbanges - e||ectlvely
oellverlng on MlF|D's key goal o| maklng Lurope's traolng
venues more llqulo ano transparent," e×plalns tbe presloent
o| Lqulouct, Dr [os Peeters.
"Lqulouct's goal ls to o||er low-cost ano very low-latency
capabllltles |or |lrms to access all o| Lurope's pools o| ll-
qulolty. For e×ample, a Frank|urt-baseo broker mlgbt bave
a olrect connectlon to tbe Deutscbe 8ourse ano tben use
our Lqulouct plat|orm to access tbe otber 28 Luropean e×-
cbanges ÷ avololng tbe cost o| comple× ln|rastructures to
connect to all 29 natlonal e×cbanges," aoos 8ob Fuller CLO
o| Lqulouct.
"MlF|D ls lntenoeo to promote cost e||ectlve pan-Luropean
traolng, not traolng ln lsolateo natlonal e×cbanges. |t ls one o|
our goals to |acllltate tbls ano provloe a solutlon tbat oellv-
ers best e×ecutlon wblle reouclng tbe overall rlsk ano costs
assoclateo wltb MlF|D lmplementatlon."
"Many e×cbanges, multl-
lateral traolng |acllltles
(MTFs) ano lnvestment
|lrms are posltlonlng
tbemselves ln antlclpatlon
o| tbe mucb more com-
petltlve conoltlons wblcb
tbe MlF|D wlll create. "
Oc t obe r 200 6
Wloe ano e×tenslve consultatlon
Tbe MlF|D leglslatlon bas been oevelopeo ano aoopteo
ln a serles o| stages known
as tbe Lam|alussy process.
Tbe "level 1" Dlrectlve estab-
llsbes tbe gulolng prlnclples o|
tbe leglslatlon. Tbls was aoopt-
eo by tbe Luropean Parllament
ano tbe Luropean Councll un-
oer tbe co-oeclslon process ln
2004
Tbls bas been |olloweo by tbe
"level 2" lmplementlng meas-
ures wblcb are tbe tecbnlcal
operatlonal measures aoopteo
by tbe Luropean Commlsslon
separately tbrougb tbe "coml-
tology proceoure" l.e. a|ter
posltlve oplnlon lssueo by a commlttee o| representatlves o|
tbe Member States ano "ULTRAVIRES control by tbe Luropean
Parllament.
Tbe Commlsslon's "Level 2" measures were aoopteo ln Au-
gust 2006 ano publlsbeo ln September 2006.
Tbe "level 2" measures are tbe result o| an unpreceoenteo
ano lntense rouno o| consultatlons wltb all stakeboloers
÷ lncluolng Member States, regulators, |lrms ano consumers.
Tbey are baseo largely on tbe aovlce provloeo by tbe Com-
mlttee o| Luropean Securltles Pegulators (CLSP) wblcb
ltsel| bas conoucteo e×tenslve ln-oeptb tecbnlcal olscusslons
wltb tbe securltles regulators, as well as e×tenslve consulta-
tlon wltb tbe publlc.
Success |or 'Lam|alussy process'
Tbe Flnnlsb MLP, Plla-Noora Kauppl, wbo ls tbe Luropean
Parllament's RAPPORTEUR |or tbe MlF|D Dlrectlve, blgbllgbts R
tbe |act tbat tbls leglslatlon bas been tbe |lrst major test
|or tbe Lam|alussy process ano tbe use o| tbls approacb to
oeveloplng blgbly comple× leglslatlon.
"We |eel tbat tbe process bas workeo well. Tbere bas been
a blgb level o| consultatlon wltb all partles wbetber tbrougb
tbe |ormal cbannels or tbrougb representatlons |rom spe-
cl|lc lnterest groups. All volces bave been bearo lncluolng
tbe CLSP, Member States ano tbe lnoustry. All bave con-
trlbuteo tbelr polnts o| vlew, allowlng us pollcy-makers to
make our oeclslons baseo on tbe most complete ano up to
oate ln|ormatlon.
"|n many respects tbls consultatlon process ls an
e×presslon o| tbe oemocratlc process ano tbe
Oc t obe r 200 6
12
MlF|D sets more comprebenslve requlrements governlng
tbe organlsatlon ano conouct o| buslness o| lnvestment
|lrms, ano bow regulateo markets ano MTFs operate.
Most |lrms tbat |all wltbln tbe scope o| MlF|D wlll also bave
to comply wltb tbe new Capltal Pequlrements Dlrectlve
(CPD) wblcb wlll set requlrements |or tbe regulatory capltal
wblcb a |lrm must bolo. Tbose |lrms newly covereo by MlF|D
wlll be subject to Dlrectlve-baseo capltal requlrements |or
tbe |lrst tlme.
Wbo ls a||ecteo
|n general MlF|D wlll cover all tbe |lrms currently subject to
tbe |SD, plus some tbat currently are not. Tbls wlll lncluoe:
lnvestment banks, port|ollo managers, stockbrokers ano
broker oealers, corporate |lnance |lrms, many |utures ano
optlons |lrms, ano some commooltles |lrms.
|n some areas, tbe posltlon |or |lrms wlll be less clear-cut.
For lnstance, retall banks ano bullolng socletles wlll be sub-
ject to MlF|D |or some parts o| tbelr buslness (e.g. selllng
to customers securltles, or lnvestment prooucts wblcb con-
taln securltles) but not otbers not llnkeo to tbe provlslon
o| lnvestment servlces covereo by tbe MlF|D. Nevertbeless,
tbese asymmetrles ln tbe treatment o| ol||erent actlvltles
e×erclseo by tbe same |lrm wlll be subject, among otber ls-
sues, to a broao revlew by tbe Commlsslon wblcb wlll eno
ln late 2008 ÷ beglnnlng 2009.
8ene|lts |or consumers
Unoer tbe MlF|D reglme consumers wlll bave a blgger cbolce
o| lnvestment servlce provloers ÷ wbo wlll be requlreo, all
o| tbem, to con|orm to blgb stanoaros o| bebavlour to tbelr
cllents. Tbls wlll lncrease
competltlon among |lrms.
Consumers wlll enjoy tbe
same level o| protectlon
wbetber tbey cboose a
oomestlc servlce provloer
or a |orelgn one. Ano tbe
level o| protectlon tbey
wlll bave wlll be blgb.
Flrms are also requlreo, wben provlolng lnvestment servlces,
to collect su||lclent ln|ormatlon to ensure tbat tbe prooucts
ano servlces wblcb tbey provloe are "sultable" or "approprl-
ate" |or tbelr cllents.
As a result, small-scale ano retall lnvestors wlll bave a blgger
cbolce o| prooucts ano servlces to cboose |rom ano equl-
tles, bonos etc. to lnvest ln, tbus allowlng tbem to ma×lmlse
tbe returns on tbelr savlngs.
Antlclpateo lmpact
Cbarlle McCreevy, Commlssloner |or |nternal Market ano
Servlces, bas calleo MlF|D a "grouno-breaklng plece o| leg-
lslatlon" wblcb wlll trans|orm tbe lanoscape |or tbe traolng
o| securltles ano lntroouce mucb neeoeo competltlon ano
e||lclency.
"|n practlcal terms, tbe MlF|D wlll allow lnvestment |lrms to
operate across tbe LU on tbe basls o| just one autborlsatlon
|rom tbelr bome state, ano sboulo o||er new competltlon
ano oynamlsm ano not stl|le lt. For compllance questlons,
lnvestment |lrms wlll just bave one regulator to answer to,
maklng lt mucb easler to work on a pan LU basls.
"Our approacb works wltb tbe graln o| tbe market ano not
agalnst lt," be empbaslses. "Tbese measures wlll protect ln-
vestors wltbout puttlng an e×cesslve buroens on buslness. "
Greater competltlon |or stock e×cbanges
Tbe new measures are e×pecteo to slgnl|lcantly reouce tbe
barrlers to cross-boroer traolng o| sbares ano cross-boroer
provlslon o| lnvestment servlces, tbe Commlssloner says, ano
tbey wlll eno tbe monopoly wblcb certaln stock e×cbanges
bave bao on tbe traolng o| securltles. As a result, many new
opportunltles |or |lrms, markets ano lnoeeo consumers wlll
be createo. Tbe net e||ect wlll be to put pressure on traolng
plat|orms to reouce costs ano ralse tbelr game.
Tbe Dlrectlve abollsbes tbe so calleo 'concentratlon rule'
ano Member States can no longer requlre lnvestment |lrms
to route oroers only to stock e×cbanges. As a result, e×-
"...a grouno-breaklng plece o|
leglslatlon wblcb wlll trans-
|orm tbe lanoscape |or tbe
traolng o| securltles"
Luropean Parllament rapporteur,
Plla-Noora Kauppl:
"...tbe MlF|D leglslatlon ls an acbleve-
ment ln ltsel| ln terms o| cooperatlon
ano consultatlon."
"..tbe outcome ls balanceo,
proportlonate ano senslble"
- Commlssloner Cbarlle
McCreavy.
N
o
43 Oc t obe r 2006
12
N
o
43 Oc t obe r 2006
13
13
-
tltlon |rom multllateral traolng |acllltles (MTFs), l.e. broaoly
non-e×cbange traolng plat|orms ano 'systematlc lnternalls-
ers', l.e. banks or lnvestment |lrms wbo systematlcally e×-
ecute cllent oroers lnternally on own account.
MTFs ano 'systematlc lnternallsers' wlll be subject to slml-
lar pre- ano post-traoe transparency requlrements as tbe
e×cbanges. Tbls wlll ensure a level playlng |lelo between tbe
e×cbanges ano tbelr new competltors ÷ ano |ull ln|ormatlon
on traolng actlvlty to tbe market.
Catalyst |or cbange
MlF|D ls alreaoy actlng as a catalyst |or slgnl|lcant market
cbanges. Many e×cbanges, multllateral traolng |acllltles ano
lnvestment |lrms are posl-
tlonlng tbemselves ln an-
tlclpatlon o| tbe mucb more
competltlve conoltlons
wblcb tbe MlF|D wlll create.
New servlces are alreaoy
ln oevelopment. Tbe traolng
plat|orm orlglnally bullt |or
tbe LASDAO ano NASDAO
Lurope pan-Luropean e×-
cbanges, |or e×ample, ls cur- rr
rently belng oevelopeo lnto a
|ully MlF|D compllant traolng
plat|orm.
"Tbrougb tbe plat|orm, we bave oevelopeo, organlsatlons
wlll be able to use a slngle pan-Luropean e×cbange - ratber
tban bavlng to traoe ln all 29 natlonal e×cbanges - e||ectlvely
oellverlng on MlF|D's key goal o| maklng Lurope's traolng
venues more llqulo ano transparent," e×plalns tbe presloent
o| Lqulouct, Dr [os Peeters.
"Lqulouct's goal ls to o||er low-cost ano very low-latency
capabllltles |or |lrms to access all o| Lurope's pools o| ll-
qulolty. For e×ample, a Frank|urt-baseo broker mlgbt bave
a olrect connectlon to tbe Deutscbe 8ourse ano tben use
our Lqulouct plat|orm to access tbe otber 28 Luropean e×-
cbanges ÷ avololng tbe cost o| comple× ln|rastructures to
connect to all 29 natlonal e×cbanges," aoos 8ob Fuller CLO
o| Lqulouct.
"MlF|D ls lntenoeo to promote cost e||ectlve pan-Luropean
traolng, not traolng ln lsolateo natlonal e×cbanges. |t ls one o|
our goals to |acllltate tbls ano provloe a solutlon tbat oellv-
ers best e×ecutlon wblle reouclng tbe overall rlsk ano costs
assoclateo wltb MlF|D lmplementatlon."
"Many e×cbanges, multl-
lateral traolng |acllltles
(MTFs) ano lnvestment
|lrms are posltlonlng
tbemselves ln antlclpatlon
o| tbe mucb more com-
petltlve conoltlons wblcb
tbe MlF|D wlll create. "
Oc t obe r 200 6
Wloe ano e×tenslve consultatlon
Tbe MlF|D leglslatlon bas been oevelopeo ano aoopteo
ln a serles o| stages known
as tbe Lam|alussy process.
Tbe "level 1" Dlrectlve estab-
llsbes tbe gulolng prlnclples o|
tbe leglslatlon. Tbls was aoopt-
eo by tbe Luropean Parllament
ano tbe Luropean Councll un-
oer tbe co-oeclslon process ln
2004
Tbls bas been |olloweo by tbe
"level 2" lmplementlng meas-
ures wblcb are tbe tecbnlcal
operatlonal measures aoopteo
by tbe Luropean Commlsslon
separately tbrougb tbe "coml-
tology proceoure" l.e. a|ter
posltlve oplnlon lssueo by a commlttee o| representatlves o|
tbe Member States ano "ULTRAVIRES control by tbe Luropean
Parllament.
Tbe Commlsslon's "Level 2" measures were aoopteo ln Au-
gust 2006 ano publlsbeo ln September 2006.
Tbe "level 2" measures are tbe result o| an unpreceoenteo
ano lntense rouno o| consultatlons wltb all stakeboloers
÷ lncluolng Member States, regulators, |lrms ano consumers.
Tbey are baseo largely on tbe aovlce provloeo by tbe Com-
mlttee o| Luropean Securltles Pegulators (CLSP) wblcb
ltsel| bas conoucteo e×tenslve ln-oeptb tecbnlcal olscusslons
wltb tbe securltles regulators, as well as e×tenslve consulta-
tlon wltb tbe publlc.
Success |or 'Lam|alussy process'
Tbe Flnnlsb MLP, Plla-Noora Kauppl, wbo ls tbe Luropean
Parllament's RAPPORTEUR |or tbe MlF|D Dlrectlve, blgbllgbts R
tbe |act tbat tbls leglslatlon bas been tbe |lrst major test
|or tbe Lam|alussy process ano tbe use o| tbls approacb to
oeveloplng blgbly comple× leglslatlon.
"We |eel tbat tbe process bas workeo well. Tbere bas been
a blgb level o| consultatlon wltb all partles wbetber tbrougb
tbe |ormal cbannels or tbrougb representatlons |rom spe-
cl|lc lnterest groups. All volces bave been bearo lncluolng
tbe CLSP, Member States ano tbe lnoustry. All bave con-
trlbuteo tbelr polnts o| vlew, allowlng us pollcy-makers to
make our oeclslons baseo on tbe most complete ano up to
oate ln|ormatlon.
"|n many respects tbls consultatlon process ls an
e×presslon o| tbe oemocratlc process ano tbe
Oc t obe r 200 6
12
MlF|D sets more comprebenslve requlrements governlng
tbe organlsatlon ano conouct o| buslness o| lnvestment
|lrms, ano bow regulateo markets ano MTFs operate.
Most |lrms tbat |all wltbln tbe scope o| MlF|D wlll also bave
to comply wltb tbe new Capltal Pequlrements Dlrectlve
(CPD) wblcb wlll set requlrements |or tbe regulatory capltal
wblcb a |lrm must bolo. Tbose |lrms newly covereo by MlF|D
wlll be subject to Dlrectlve-baseo capltal requlrements |or
tbe |lrst tlme.
Wbo ls a||ecteo
|n general MlF|D wlll cover all tbe |lrms currently subject to
tbe |SD, plus some tbat currently are not. Tbls wlll lncluoe.
lnvestment banks, port|ollo managers, stockbrokers ano
broker oealers, corporate |lnance |lrms, many |utures ano
optlons |lrms, ano some commooltles |lrms.
|n some areas, tbe posltlon |or |lrms wlll be less clear-cut.
For lnstance, retall banks ano bullolng socletles wlll be sub-
ject to MlF|D |or some parts o| tbelr buslness (e.g. selllng
to customers securltles, or lnvestment prooucts wblcb con-
taln securltles) but not otbers not llnkeo to tbe provlslon
o| lnvestment servlces covereo by tbe MlF|D. Nevertbeless,
tbese asymmetrles ln tbe treatment o| ol||erent actlvltles
e×erclseo by tbe same |lrm wlll be subject, among otber ls-
sues, to a broao revlew by tbe Commlsslon wblcb wlll eno
ln late 2008 ÷ beglnnlng 2009.
8ene|lts |or consumers
Unoer tbe MlF|D reglme consumers wlll bave a blgger cbolce
o| lnvestment servlce provloers ÷ wbo wlll be requlreo, all
o| tbem, to con|orm to blgb stanoaros o| bebavlour to tbelr
cllents. Tbls wlll lncrease
competltlon among |lrms.
Consumers wlll enjoy tbe
same level o| protectlon
wbetber tbey cboose a
oomestlc servlce provloer
or a |orelgn one. Ano tbe
level o| protectlon tbey
wlll bave wlll be blgb.
Flrms are also requlreo, wben provlolng lnvestment servlces,
to collect su||lclent ln|ormatlon to ensure tbat tbe prooucts
ano servlces wblcb tbey provloe are "sultable" or "approprl-
ate" |or tbelr cllents.
As a result, small-scale ano retall lnvestors wlll bave a blgger
cbolce o| prooucts ano servlces to cboose |rom ano equl-
tles, bonos etc. to lnvest ln, tbus allowlng tbem to ma×lmlse
tbe returns on tbelr savlngs.
Antlclpateo lmpact
Cbarlle McCreevy, Commlssloner |or |nternal Market ano
Servlces, bas calleo MlF|D a "grouno-breaklng plece o| leg-
lslatlon" wblcb wlll trans|orm tbe lanoscape |or tbe traolng
o| securltles ano lntroouce mucb neeoeo competltlon ano
e||lclency.
"|n practlcal terms, tbe MlF|D wlll allow lnvestment |lrms to
operate across tbe LU on tbe basls o| just one autborlsatlon
|rom tbelr bome state, ano sboulo o||er new competltlon
ano oynamlsm ano not stl|le lt. For compllance questlons,
lnvestment |lrms wlll just bave one regulator to answer to,
maklng lt mucb easler to work on a pan LU basls.
"Our approacb works wltb tbe graln o| tbe market ano not
agalnst lt," be empbaslses. "Tbese measures wlll protect ln-
vestors wltbout puttlng an e×cesslve buroens on buslness. "
Greater competltlon |or stock e×cbanges
Tbe new measures are e×pecteo to slgnl|lcantly reouce tbe
barrlers to cross-boroer traolng o| sbares ano cross-boroer
provlslon o| lnvestment servlces, tbe Commlssloner says, ano
tbey wlll eno tbe monopoly wblcb certaln stock e×cbanges
bave bao on tbe traolng o| securltles. As a result, many new
opportunltles |or |lrms, markets ano lnoeeo consumers wlll
be createo. Tbe net e||ect wlll be to put pressure on traolng
plat|orms to reouce costs ano ralse tbelr game.
Tbe Dlrectlve abollsbes tbe so calleo 'concentratlon rule'
ano Member States can no longer requlre lnvestment |lrms
to route oroers only to stock e×cbanges. As a result, e×-
"...a grouno-breaklng plece o|
leglslatlon wblcb wlll trans-
|orm tbe lanoscape |or tbe
traolng o| securltles"
Luropean Parllament rapporteur,
Plla-Noora Kauppl.
"...tbe MlF|D leglslatlon ls an acbleve-
ment ln ltsel| ln terms o| cooperatlon
ano consultatlon."
"..tbe outcome ls balanceo,
proportlonate ano senslble"
- Commlssloner Cbarlle
McCreavy.
N
o
43 Oc t obe r 2006
15
Luropean Parllament bas maoe
a major contrlbutlon to tbe oe-
velopment ano |lne-tunlng o| tbls
Dlrectlve."
Partlcularly pleaslng |or tbe Flnn-
lsb MLP bas been tbe worklng
relatlonsblp oevelopeo wltb tbe
Commlsslon's speclallsts.
"Tbere bas been a transparent
process between tbe Parllament
ano tbe Commlsslon ano a con-
stant olalogue tbrougbout tbe
varlous stages. |t bas been very
|le×lble ano very proouctlve. At
one stage | was worklng wltb top
Commlsslon o||lclals vla a tel-
econ|erenclng llnk |rom Flnlano
to olscuss ano resolve many |lner
polnts o| oetall. |t resulteo ln valu-
able lmprovements belng maoe at
an early stage to tbe Commls-
slon's worklng papers."
Ms Kauppl polnts out tbat tbe blgb level o| consultatlon ln-
volveo ln oeveloplng tbe MlF|D bas leo to a certaln sllppage ln
tbe tlme scbeoule. "One tblng we bave learneo ls tbat proper
consultatlon takes tlme. Ano tbe last tblng anybooy wlsbes to
see ln tbls comple× ano lmportant area ls bao leglslatlon oone
ln baste.
"|noeeo, to |lno tbe most e||ectlve route to barmonlse leglsla-
tlon, tbe best route bas not always been to take tbe slmplest
solutlon ano sell lt to tbe otbers. We bave trleo to |lno solutlons
wblcb best sult tbe market traoltlons ano specl|lcltles o| tbe
partles concerneo.
"Ano at every stage we bave askeo tbe questlon wbetber tbe
bene|lt wlll be greater tban tbe cost o| lmplementatlon. Tbese
are especlally lmportant lssues |or tbe smaller Member States
ano smaller lnvestment companles."
Commlssloner McCreavy stresses tbe outcome ls balanceo,
proportlonate ano senslble. "|t bas been cra|teo a|ter tbe
Oc t obe r 200 6
ln|o
14
ln|o bttp://ec.europa.eu/lnternal_market/securltles/lso/lnoe×_en.btm
|ull lnvolvement ano consultatlon o| all tbe relevant lnterest
groups."
Plla-Noora Kauppl says tbat "At tbe eno o| tbe oay, tbe MlF|D
leglslatlon ls an acblevement ln ltsel| ln terms o| cooperatlon
ano consultatlon.
|t bas oemonstrateo a wllllngness on tbe part o| all players -
Member States, tbe Luropean Parllament, regulators, markets
ano consumers - to work togetber constructlvely to acbleve
tbe rlgbt result |or Lurope's |lnanclal markets, Luropean lnves-
tors ano tbe economy as a wbole."
|mplementatlon ano |ollow-up
Tbe target oate |or lmplementatlon ls 1 November 2007. Na-
tlonal autborltles ln Member States must transpose MlF|D's re-
qulrements lnto oomestlc law by tbe eno o| [anuary 2007.
Tbe Commlsslon wlll con-
tlnually evaluate tbe MlF|D
to ensure lt ls worklng ln
practlce ano ls oellverlng
tbe lntenoeo results.
A Practltloners L×perts
Group was set up ln Sep-
tember wblcb over tbe ne×t
tbree years wlll belp wltb tbe
work o| evaluatlon, A O&A
oatabase ls belng oevelopeo
to alo tbe transposltlon.
|n aooltlon, tbe MlF|D specl|lcally requlres tbe Commlsslon to
oraw up reports on tbe lmplementatlon o| partlcular provlslons
(e.g. pro|esslonal lnoemnlty lnsurance, pre-traoe transparency
o| systematlc lnternallsers, pre- ano post-traoe transparency o|
|lnanclal lnstruments otber tban sbares).
Tbe majorlty o| tbese reports are oue to appear ourlng 2007
ano 2008. || any cbanges to tbe M|F|D lmplementlng rules are
necessary tben tbe mecbanlsms ln place can allow |or relatlvely
speeoy aojustment.
Marla velenzta
TLL: +32 (0)2.295 17 23
FAX: +32 (0)2.29556 06
Markt-G3@ec.europa.eu
Flnanclal reportlng
Auoltors' llablllty - stuoy
sbows tbreat o| current rules
to |lnanclal stablllty
ln|o
bttp://ec.europa.eu/lnternal_market/auoltlng/lnoe×_en.btm
Tbe rlsk o| rulnous law sults olrecteo towaros auoltlng |lrms was
clearly oemonstrateo wltb tbe collapse o| Artbur Anoersen ln 2002
ln tbe a|termatb o| tbe Lnron scanoal. A stuoy by Lonoon Lconomlcs
argues, tbat a slmllar blow to one o| tbe |our oomlnant accountlng
|lrms (KPMG, Lrnst & Young, PwC ano Deloltte) coulo pose a tbreat
to |lnanclal stablllty o| tbe wloer economy, creatlng "serlous problems
|or companles wbose |lnanclal statements neeo to be auolteo".
Aooltlonally, unoer tbe current
clrcumstances, mloole-tler ñrms
are unllkely to become a major
alternatlve l| a 8lg-4 network |alls.
Tbe stuoy empbaslses tbe neeo
to aooress not only tbe llablllty o|
lnolvloual auoltors, but also tbe
potentlal llablllty o| auolt networks
as sucb, wblcb represents a new rlsk
|or auoltors,
· Tbe level o| auoltor llablllty lnsurance
avallable |or blgber llmlts bas
|allen sbarply ln recent years. Tbe
remalnlng source o| |unos to |ace
clalms may essentlally be tbe lncome
o| partners belonglng to tbe same
lnternatlonal network. Constantly
large clalms mlgbt tbere|ore put at
rlsk an entlre network,
· Tbe |allure o| a network coulo leao
to ol|ñcult consequences |or tbe
wloer economy llke a slgnlñcant
reouctlon ln large company statutory
auolt capaclty posslbly creatlng
serlous problems |or companles
wbose ñnanclal statements neeo to
be auolteo,
· A llmltatlon on auoltor llablllty woulo
reouce tbls rlsk. Wblle tbere e×lst
a number o| varlants o| statutory
auolt llablllty llmltatlon, tbe olverslty
o| clrcumstances ln terms o| botb
auolts ano company slze ls sucb tbat
lt ls unllkely tbat a one-slze-ñts-all
LU-wloe approacb ls tbe most use|ul.
Tbe stuoy ooes not necessarlly e×press
tbe Commlsslon's o||lclal vlew. Tbe e×-
ternal consultant, Lonoon Lconomlcs,
remalns responslble |or tbe |acts ano tbe
vlews set out ln tbe report.
Ne×t steps
Tbe Commlsslon wlll lssue a report
baseo on tbls stuoy be|ore tbe eno o|
2006. Stakeboloers wlll be lnvlteo to glve
tbelr vlews.
|nternal Market ano Servlces Commls-
sloner Cbarlle McCreevy salo: "Tbls stuoy
provloes valuable lnput lnto our e×aml-
natlon o| auoltors' llablllty. |t blgbllgbts
tbat large clalms may put at rlsk an entlre
auoltlng network. Tbere are lmportant
lssues at stake. | recognlse oplnlons are
olvloeo about bow we sboulo aooress
tbese. | bope tbe olscusslon tbat tbls re-
port wlll engenoer wlll allow us to reacb
a clearer unoerstanolng o| bow best to
aooress tbe real problems tbat are tbere
ano wlll not go away. Glven tbe lmpor- rr
tant role auoltlng companles play ln our
capltal markets, we wlll soon present our
vlews on posslble ways |orwaro |or |ur- rr
tber olscusslon."
T
be Commlsslon bas publlsbeo an ln-
oepenoent stuoy on tbe economlc
lmpact o| current LU rules on auoltors'
llablllty reglmes ano on lnsurance conol-
tlons ln Member States.
Tbe new stuoy states tbat "one o| tbe
major 8lg Four networks coulo posslbly
|all" ano tbat "a llmltatlon on auoltor ll-
ablllty woulo reouce rlsk causeo by po-
tentlal catastropblc clalms."
Tbe stuoy analyses tbe structure o| tbe
auoltlng market ano lts posslble oevelop-
ment ln tbe |uture, oescrlbes tbe e×lstlng
llmltatlons ln tbe lnsurance market |or
lnternatlonal auolts, e×amlnes tbe eco-
nomlc neeos |or llmltlng auoltors' llablllty
ano compares several posslble metboos
|or llmltlng llablllty.
|t represents tbe |lrst LU-wloe scale eco-
nomlc stuoy on tbls subject. Tbe prepara-
tlon o| tbe stuoy bas been accompanleo
by tbe creatlon o| an Auoltors Llablllty
Forum composeo o| market e×perts.
Key concluslons
Tbe |our key lssues loentl|leo ln tbe stuoy
are:
· Tbe lnternatlonal market |or
statutory auolts o| large ano
very large companles ls blgbly
concentrateo ano oomlnateo by
tbe 8lg-4 networks. Tbe llkellbooo
o| new entrants lnto tbls market ls
very llmlteo ln tbe comlng years.
ln|o
Anne-Francolse Mélot
TLL: +32 (0)2.298 06 91
FAX: +32 (0)2.299 30 81
Markt-F4@ec.europa.eu
MLP Kauppl:
"All bave contrlbuteo
tbelr polnts o| vlew, allow-
lng us pollcy-makers to
make our oeclslons baseo
on tbe most complete ano
up to oate ln|ormatlon. "
N
o
43 Oc t obe r 2006
15
Luropean Parllament bas maoe
a major contrlbutlon to tbe oe-
velopment ano |lne-tunlng o| tbls
Dlrectlve."
Partlcularly pleaslng |or tbe Flnn-
lsb MLP bas been tbe worklng
relatlonsblp oevelopeo wltb tbe
Commlsslon's speclallsts.
"Tbere bas been a transparent
process between tbe Parllament
ano tbe Commlsslon ano a con-
stant olalogue tbrougbout tbe
varlous stages. |t bas been very
|le×lble ano very proouctlve. At
one stage | was worklng wltb top
Commlsslon o||lclals vla a tel-
econ|erenclng llnk |rom Flnlano
to olscuss ano resolve many |lner
polnts o| oetall. |t resulteo ln valu-
able lmprovements belng maoe at
an early stage to tbe Commls-
slon's worklng papers."
Ms Kauppl polnts out tbat tbe blgb level o| consultatlon ln-
volveo ln oeveloplng tbe MlF|D bas leo to a certaln sllppage ln
tbe tlme scbeoule. "One tblng we bave learneo ls tbat proper
consultatlon takes tlme. Ano tbe last tblng anybooy wlsbes to
see ln tbls comple× ano lmportant area ls bao leglslatlon oone
ln baste.
"|noeeo, to |lno tbe most e||ectlve route to barmonlse leglsla-
tlon, tbe best route bas not always been to take tbe slmplest
solutlon ano sell lt to tbe otbers. We bave trleo to |lno solutlons
wblcb best sult tbe market traoltlons ano specl|lcltles o| tbe
partles concerneo.
"Ano at every stage we bave askeo tbe questlon wbetber tbe
bene|lt wlll be greater tban tbe cost o| lmplementatlon. Tbese
are especlally lmportant lssues |or tbe smaller Member States
ano smaller lnvestment companles."
Commlssloner McCreavy stresses tbe outcome ls balanceo,
proportlonate ano senslble. "|t bas been cra|teo a|ter tbe
Oc t obe r 200 6
ln|o
14
ln|o bttp://ec.europa.eu/lnternal_market/securltles/lso/lnoe×_en.btm
|ull lnvolvement ano consultatlon o| all tbe relevant lnterest
groups."
Plla-Noora Kauppl says tbat "At tbe eno o| tbe oay, tbe MlF|D
leglslatlon ls an acblevement ln ltsel| ln terms o| cooperatlon
ano consultatlon.
|t bas oemonstrateo a wllllngness on tbe part o| all players -
Member States, tbe Luropean Parllament, regulators, markets
ano consumers - to work togetber constructlvely to acbleve
tbe rlgbt result |or Lurope's |lnanclal markets, Luropean lnves-
tors ano tbe economy as a wbole."
|mplementatlon ano |ollow-up
Tbe target oate |or lmplementatlon ls 1 November 2007. Na-
tlonal autborltles ln Member States must transpose MlF|D's re-
qulrements lnto oomestlc law by tbe eno o| [anuary 2007.
Tbe Commlsslon wlll con-
tlnually evaluate tbe MlF|D
to ensure lt ls worklng ln
practlce ano ls oellverlng
tbe lntenoeo results.
A Practltloners L×perts
Group was set up ln Sep-
tember wblcb over tbe ne×t
tbree years wlll belp wltb tbe
work o| evaluatlon, A O&A
oatabase ls belng oevelopeo
to alo tbe transposltlon.
|n aooltlon, tbe MlF|D specl|lcally requlres tbe Commlsslon to
oraw up reports on tbe lmplementatlon o| partlcular provlslons
(e.g. pro|esslonal lnoemnlty lnsurance, pre-traoe transparency
o| systematlc lnternallsers, pre- ano post-traoe transparency o|
|lnanclal lnstruments otber tban sbares).
Tbe majorlty o| tbese reports are oue to appear ourlng 2007
ano 2008. || any cbanges to tbe M|F|D lmplementlng rules are
necessary tben tbe mecbanlsms ln place can allow |or relatlvely
speeoy aojustment.
Marla velenzta
TLL: +32 (0)2.295 17 23
FAX: +32 (0)2.29556 06
Markt-G3@ec.europa.eu
Flnanclal reportlng
Auoltors' llablllty - stuoy
sbows tbreat o| current rules
to |lnanclal stablllty
ln|o
bttp://ec.europa.eu/lnternal_market/auoltlng/lnoe×_en.btm
Tbe rlsk o| rulnous law sults olrecteo towaros auoltlng |lrms was
clearly oemonstrateo wltb tbe collapse o| Artbur Anoersen ln 2002
ln tbe a|termatb o| tbe Lnron scanoal. A stuoy by Lonoon Lconomlcs
argues, tbat a slmllar blow to one o| tbe |our oomlnant accountlng
|lrms (KPMG, Lrnst & Young, PwC ano Deloltte) coulo pose a tbreat
to |lnanclal stablllty o| tbe wloer economy, creatlng "serlous problems
|or companles wbose |lnanclal statements neeo to be auolteo".
Aooltlonally, unoer tbe current
clrcumstances, mloole-tler ñrms
are unllkely to become a major
alternatlve l| a 8lg-4 network |alls.
Tbe stuoy empbaslses tbe neeo
to aooress not only tbe llablllty o|
lnolvloual auoltors, but also tbe
potentlal llablllty o| auolt networks
as sucb, wblcb represents a new rlsk
|or auoltors,
· Tbe level o| auoltor llablllty lnsurance
avallable |or blgber llmlts bas
|allen sbarply ln recent years. Tbe
remalnlng source o| |unos to |ace
clalms may essentlally be tbe lncome
o| partners belonglng to tbe same
lnternatlonal network. Constantly
large clalms mlgbt tbere|ore put at
rlsk an entlre network,
· Tbe |allure o| a network coulo leao
to ol|ñcult consequences |or tbe
wloer economy llke a slgnlñcant
reouctlon ln large company statutory
auolt capaclty posslbly creatlng
serlous problems |or companles
wbose ñnanclal statements neeo to
be auolteo,
· A llmltatlon on auoltor llablllty woulo
reouce tbls rlsk. Wblle tbere e×lst
a number o| varlants o| statutory
auolt llablllty llmltatlon, tbe olverslty
o| clrcumstances ln terms o| botb
auolts ano company slze ls sucb tbat
lt ls unllkely tbat a one-slze-ñts-all
LU-wloe approacb ls tbe most use|ul.
Tbe stuoy ooes not necessarlly e×press
tbe Commlsslon's o||lclal vlew. Tbe e×-
ternal consultant, Lonoon Lconomlcs,
remalns responslble |or tbe |acts ano tbe
vlews set out ln tbe report.
Ne×t steps
Tbe Commlsslon wlll lssue a report
baseo on tbls stuoy be|ore tbe eno o|
2006. Stakeboloers wlll be lnvlteo to glve
tbelr vlews.
|nternal Market ano Servlces Commls-
sloner Cbarlle McCreevy salo: "Tbls stuoy
provloes valuable lnput lnto our e×aml-
natlon o| auoltors' llablllty. |t blgbllgbts
tbat large clalms may put at rlsk an entlre
auoltlng network. Tbere are lmportant
lssues at stake. | recognlse oplnlons are
olvloeo about bow we sboulo aooress
tbese. | bope tbe olscusslon tbat tbls re-
port wlll engenoer wlll allow us to reacb
a clearer unoerstanolng o| bow best to
aooress tbe real problems tbat are tbere
ano wlll not go away. Glven tbe lmpor- rr
tant role auoltlng companles play ln our
capltal markets, we wlll soon present our
vlews on posslble ways |orwaro |or |ur- rr
tber olscusslon."
T
be Commlsslon bas publlsbeo an ln-
oepenoent stuoy on tbe economlc
lmpact o| current LU rules on auoltors'
llablllty reglmes ano on lnsurance conol-
tlons ln Member States.
Tbe new stuoy states tbat "one o| tbe
major 8lg Four networks coulo posslbly
|all" ano tbat "a llmltatlon on auoltor ll-
ablllty woulo reouce rlsk causeo by po-
tentlal catastropblc clalms."
Tbe stuoy analyses tbe structure o| tbe
auoltlng market ano lts posslble oevelop-
ment ln tbe |uture, oescrlbes tbe e×lstlng
llmltatlons ln tbe lnsurance market |or
lnternatlonal auolts, e×amlnes tbe eco-
nomlc neeos |or llmltlng auoltors' llablllty
ano compares several posslble metboos
|or llmltlng llablllty.
|t represents tbe |lrst LU-wloe scale eco-
nomlc stuoy on tbls subject. Tbe prepara-
tlon o| tbe stuoy bas been accompanleo
by tbe creatlon o| an Auoltors Llablllty
Forum composeo o| market e×perts.
Key concluslons
Tbe |our key lssues loentl|leo ln tbe stuoy
are:
· Tbe lnternatlonal market |or
statutory auolts o| large ano
very large companles ls blgbly
concentrateo ano oomlnateo by
tbe 8lg-4 networks. Tbe llkellbooo
o| new entrants lnto tbls market ls
very llmlteo ln tbe comlng years.
ln|o
Anne-Francolse Mélot
TLL: +32 (0)2.298 06 91
FAX: +32 (0)2.299 30 81
Markt-F4@ec.europa.eu
MLP Kauppl:
"All bave contrlbuteo
tbelr polnts o| vlew, allow-
lng us pollcy-makers to
make our oeclslons baseo
on tbe most complete ano
up to oate ln|ormatlon. "
N
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43 Oc t obe r 20 06
16
Business consultation
European Business Test Panel
in new push to hear
the voice of EU business


I
mproving consultation is an important
part of the Commission’s "Better Regu-
lation" Action Plan of June 2002, and a key
element of the European Union’s drive to
make Europe the best place to do busi-
ness in the world.
An online consultation tool the European
Business Test Panel (EBTP) was launched
in 2003 as a joint initiative between EU
Member Sates and DG Internal Market
and Services. Its aim is to help improve
and expand consultation links with busi-
nesses community throughout the EU.
EBTP is a unique tool which sets out to
obtain direct feedback from businesses of
all type and size on Commission legisla-
tive proposals or initiatives likely to have
an impact on the business community.
Working through national coordinators,
the members of EBTP who are independ-
ent companies, are invited to give their
viewpoint on the potential impact.
The consultation takes the form of an
online questionnaire which should take
no more than 20 minutes to fill in. The
number of consultations per year is not
expected to exceed eight.
Expanding the membership base
The programme is open to all businesses.
So far more than 3,000 companies of
different sizes and sectors lo-
cated in all EU countries have
become members and have al-
ready provided valuable input.
The Commission is seeking to
further expand the member-
ship base. To ensure effective
representation, the Commis-
sion is working with the EU's
statistics office, Eurostat, to
ensure that the business panel
is representative in terms of
size of companies and sectors
in which they work.
Early achievements
The EBTP has already made its
voice felt through the first consultations.
On the topic of VAT procedures, 54% of
the EBTP members responding to the
questionnaire said that they had never
requested a VAT refund in another EU
country because the procedure was too
difficult. As a result of this, the Commis-
sion developed a new proposal in Octo-
ber 2004 for a simplified electronic pro-
cedure for claiming refunds of VAT paid in
other Member States.
Through other consultations, EBTP mem-
bers informed the Commission that the
costs of complying with legislation are
too high and rising. Indeed, they cite em-
ployment, taxation and accounting rules
Since the launch of the online European Business Test Panel in 2003,
more than 3,000 companies have joined as members to give their
feedback on Commission proposals likely to impact their business.
During this development phase, business feedback has already had an
impact on legislative proposals. The Commission is now pushing to
develop a large membership base of EBTP across the EU to make it
as representative as possible.
as the most costly to comply with. This in-
formation has been fed through to policy
makers to help them set the appropriate
priorities as they work to reduce burdens
related to EU legislation.
Totally Internet-based
The EBTP consultations are entirely In-
ternet based, using the on-line consulta-
tion tools developed under the Interac-
tive Policy Making (IPM) initiative. This
survey mechanism allows the consulta-
tion process to be fast and efficient, and
the results of consultations can be made
available to both participants and policy-
makers directly after their closure.
European Commission President José Manuel
Barroso (right) with UNICE Secretary General
Philippe de Buck. EBTP is building closer contacts
with industry groups to involve a wider cross-sec-
tion of business in the consultation process.
SMN43-inside.indd 16 28/11/2006 10:55:14
N
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43 Oc t obe r 2006
17
info http://ec.europa.eu/internal_market/publicprocurement/key-docs_en.htm
Business Consultation
info http://ec.europa.eu/yourvoice/ebtp
replies are aggregated and no reference
to individual businesses is given.
A few weeks later panel members receive
a report on the views expressed during
each consultation. Explanations as to what
follow-up action will ensue, is given later.
The views gathered through the consulta-
tion are fed into the policy-making proc-
ess and policy-makers are committed to
taking them into account when finalising
their proposals. As these procedures can
be lengthy, there is some-
times a considerable time
gap before a proposal is
finally adopted.

Jacqueline Minor (right)
and Werner Stengg of the
DG Internal Market and
Services' EBTP delegation
which recently participated
at a conference of UNICE,
the umbrella group for
European industry.
info
Gudrun Waldenstrom
TEL: +32 (0)2.296 30 07
FAX: +32 (0)2.299 86 30
Markt-G4@ec.europa.eu
The EBTP is jointly managed by the
Commission and Member States. In each
Member State there is a national co-or-
dinator, in some cases working closely
with business organisations, responsible
for the setting up and maintenance of the
Panel at national level.
Panellists are given a suitable time period
(at least two weeks) within which to sub-
mit their replies.
Members are supplied with a short ex-
planatory note setting out the objectives
of the new policy initiative and are asked
to complete a short questionnaire (10-
15 questions), designed for easy use and
members can work in their own language
(most documents, notices, questionnaires
and results will be available in the 20
Community languages).
Feedback
After the consultation period, panellists
can see how their counterparts have re-
sponded. For the sake of confidentiality,
SMN43-inside.indd 17 28/11/2006 10:55:15
N
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43 Oc t obe r 2006
18
N
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43 Oc t obe r 2006
19
Tbe LU prepares |or tbe
accesslon o|
8ulgarla ano Pomanla
[
olnlng tbe LU ls no small task |or any
country. Slnce 8ulgarla ano Pomanla ap-
plleo |or LU membersblp ln 1995 tbey
[
bave completeo accesslon negotlatlons,
acteo upon tbe constructlve crltlclsm
e×presseo ln successlve Commlsslon
monltorlng reports ano accommooateo
teams o| Member States ano Commls-
slon e×perts wbo bave vlslteo tbem to
get a more complete vlew o| tbe aomlnls-
tratlve capaclty ln certaln speclñc areas.
Slnce tbe slgnature o| tbe Accesslon Trea-
ty ln Aprll 2005, tbe two countrles bave
also been lnvlteo to seno observers to
Councll Worklng Groups, Commlsslon
Commlttees as well as to tbe Luropean
Parllament wblcb bas lncreaseo tbelr ln-
volvement ln LU a||alrs. Tbe populatlons
o| 8ulgarla ano Pomanla bave bao to oeal
wltb tbe cbanges resultlng |rom tbe ao-
justment o| tbelr countrles' leglslatlon
money launoerlng, company law ano tbe
protectlon o| lntellectual ano lnoustrlal
property rlgbts.
|n general terms, gooo progress bas been
maoe ln most o| tbese areas altbougb ln
some cases leglslatlon bas been aoopteo
only very recently wblcb means tbat lt
bas been lmposslble to assess tbelr lm-
plementatlon.
Sboulo any o| tbe two countrles cause or
rlsk causlng a serlous breacb o| tbe |unc-
tlonlng o| tbe lnternal market, unoer tbe
Accesslon Treaty tbe Commlsslon can
take approprlate sa|eguaro measures up
to tbree years a|ter tbelr accesslon.
|t seems ratber llkely tbat 8ulgarla ano
Pomanla wlll not be reaoy to partlclpate
|ully ln tbe motor lnsurance system o| tbe
LU on tbe oate o| accesslon. Tbls ls oue
to tbe |act tbat |ollowlng tbe provlslons o|
tbe Motor |nsurance Dlrectlves, certaln
agreements wblcb unoerpln tbe smootb
|unctlonlng o| tbe motor lnsurance sys-
tem ln tbe Luropean Unlon, sucb as tbe
Multllateral Guarantee Agreement unoer
tbe aegls o| tbe Councll o| 8ureau×, bave
yet to be slgneo wltb tbe two countrles.
Once tbese agreements are concluoeo,
tbe proper proceoures wlll bave to be
|olloweo |or tbe relevant acquls provl-
slons to take e||ect. ||, |or lnstance, tbe
Multllateral Guarantee Agreement ls not
Lnlargement
At tbe beglnnlng 2007, tbe number o| states ln tbe Luropean
Unlon wlll rlse to twenty seven wltb tbe arrlval o| 8ulgarla
ano Pomanla. 2007 wlll also mark tbe 50tb blrtboay o| tbe
LU. Slnce 1957 lts populatlon wlll bave rlsen to more tban
483 mllllon cltlzens ano tbe number o| o|ñclal languages wlll
bave e×panoeo to 23. Wltb tbe accesslon o| 8ulgarla, tbe
Cyrllllc alpbabet wlll be useo by tbe LU lnstltutlons |or tbe
ñrst tlme. Tbe accesslon o| 8ulgarla ano Pomanla wlll provloe
Greece wltb a olrect lano connectlon to tbe rest o| tbe LU.
ano aomlnlstratlon to tbe requlrements
o| tbe LU.
Consloerable e||orts
Tbe last Commlsslon monltorlng report,
publlsbeo on 29 September 2006, con-
cluoeo tbat 8ulgarla ano Pomanla were
¨su||lclently prepareo to meet tbe po-
lltlcal, economlc ano acquls crlterla by 1
[anuary 2007¨.
Tbe report acknowleogeo tbat tbe two
countrles bave maoe consloerable e||orts
to complete tbelr preparatlons |or LU
membersblp. Nonetbeless, preparatlons
ln a |ew areas bave yet to be completeo.
Tbe Commlsslon bas |oreseen tbe pos-
slble lntroouctlon o| targeteo measures
|ollowlng tbe oate o| accesslon ln tbe
areas o| juolclal re|orm, tbe |lgbt agalnst
corruptlon ano organlseo crlme, tbe
management o| LU agrlcultural |unos ano
|ooo sa|ety, as well as avlatlon sa|ety |or
8ulgarlan alrcra|t.
Gooo progress wltb Slngle Market pollcles
No sectoral sa|eguaros bave been envls-
ageo |or tbe areas wltbln tbe remlt o| DG
|nternal Market ano Servlces, wblcb ln-
cluoe publlc procurement, mutual recog-
nltlon o| pro|esslonal quall|lcatlons, rlgbt
o| establlsbment, |lnanclal servlces, postal
servlces, certaln ln|ormatlon soclety
servlces, tbe |ree movement o| capltal,

Tbe 8ulgarlan Parllament ln So|la.
Prevlous enlargement - all get rlcber
A recent stuoy assesslng tbe |lrst two
years a|ter tbe lncorporatlon o| ten new
Member States bas been publlsbeo wblcb
lnolcates tbat tbe enlargement bas been
an economlc success.
Tbe Communlcatlon ¨Lnlargement, Two
Years A|ter ÷ An Lconomlc Success¨ bas
sbown tbat tbe newly aomltteo econo-
mles are growlng at a raplo pace enabllng
tbem to progresslvely brloge tbe gap wltb
tbelr rlcber nelgbbours.
Tbe report lnolcates tbat tbe LU-15 bas
also bene|lteo as tbe lncrease o| tbe LU's
slngle market by 75 mllllon to 450 mllllon
lnbabltants bas brougbt a wealtb o| traoe
ano lnvestment opportunltles.
Tbe aooptlon o| tbe LU booy o| leglslatlon
ano rules ÷ tbe so-calleo ACQUIS - belpeo
re|orm tbose countrles wblcb prevlously
bao centrally planneo economles, brougbt
about macroeconomlc stablllty ano stable
|lnanclal markets ano provloeo buge op-
portunltles |or buslnesses.
Tbe LU-10 also attracteo a lot o| |orelgn
olrect lnvestment (FD|), reacblng an over- rr
all stock o| 191 bllllon ln 2004, or 40°
o| tbelr total GDP, wblle lt was vlrtually
non-e×lstent some ten years earller.
Tbe Full Communlcatlon, tbe stuoy on enlargement
ano tbe monltorlng report are avallable on:
Lnlargement
ln|o
bttp://europa.eu.lnt/comm/economy_ñnance/publlcatlons/occaslonalpapers_en.btm
bttp://ec.europa.eu/enlargement/key_oocuments/reports_sept_2006_en.btm
ln|o
Dora Majoros
TLL: +32 (0)2.298 03 48
FAX: +32 (0)2.295 66 95
Markt-84@ec.europa.eu
concluoeo by tbe oate o| accesslon or l|
lt ls concluoeo too late to |ul|ll all |ormall-
tles ln tlme, tbe current Member States
wlll be alloweo to malntaln boroer cbecks
on motor tblro party llablllty lnsurance
pollcles ln respect o| 8ulgarlan ano Po-
manlan veblcles as well as ln respect o|
tblro country veblcles enterlng tbelr ter- rr
rltory |rom 8ulgarla ano Pomanla.
8otb countrles bave been warneo tbat
|urtber progress woulo be necessary con-
cernlng tbe lmplementatlon ano en|orce-
ment o| tbe legal |ramework concernlng
money launoerlng ano tbat supervlsory
capaclty woulo neeo to be lncreaseo.
Progress ln |PP |lelo
8ulgarla ano Pomanla bave come a
long way ln tbe |lelo o| lntellectual
ano lnoustrlal property rlgbts pro-
tectlon. |mprovlng tbe sltuatlon ln
tbls |lelo bas been a prlorlty |or tbe
Commlsslon ano, as a result, tbe lssue
bas been blgbllgbteo ln successlve
monltorlng reports ano bas also been tbe
subject o| so-calleo peer revlews (assess-
ments oone by e×perts |rom tbe Member
States) ln botb countrles. Nonetbeless
tbe requlrements set by tbe ACQUIS bave
not been |ully met to oate.
Tbe most recent monltorlng report
calleo on 8ulgarla to ensure tbat users
o| protecteo subject matter, lncluolng
cable operators, comply wltb tbelr ob-
llgatlons to pay royaltles. |t polnteo out
tbat, as a result o| recent amenoments to
tbe 8ulgarlan patent law, acqulreo rlgbts
bave been curtalleo ln some cases. Poma-
nla was cautloneo tbat lts Copyrlgbt Act
was not |ully ln llne yet wltb LU requlre-
ments.
Tbe Commlsslon bao been unable to as-
sess wbetber Pomanla woulo correctly
transpose tbe new rules on capltal re-
qulrements |or creolt lnstltutlons ano
lnvestment |lrms by tbe tlme o| tbe most
recent monltorlng report, oue to lnsu|- ||
|lclent ln|ormatlon recelveo.
Tbe Pomanlan autborltles bave provlo-
eo |urtber ln|ormatlon ln tbe meantlme
wblcb ls currently belng analyseo by DG
|nternal Market ano Servlces.
Tbe two countrles, togetber wltb tbe LU-
25, bave untll tbe eno o| 2006 to trans-
pose tbe new Dlrectlves.
Tbe Councll con|lrmeo tbe proposeo ac-
cesslon oate on 17tb October 2006. |n lts
concluslons, tbe Councll unoerllneo ¨tbe
lmportance o| contlnueo polltlcal com-
mltment o| botb countrles to aooress
"outstanolng lssues¨.
Denmark ano Germany must complete
tbe ratl|lcatlon process o| tbe Accesslon
Treaty (wblcb was stlll ln progress at tbe
eno o| October 2006) be|ore 8ulgarla
ano Pomanla can become Member States
at tbe start o| 2007.
Tbe speclallseo unlts ln DG |nternal Mar- rr
ket ano Servlces contlnue to be ln regular
contact wltb tbe autborltles o| 8ulgarla
ano Pomanla to enable tbem to complete
tbelr |lnal preparatlons by tbe eno o| tbe
year.

Tbe anclent ano mooern skyllne o|
tbe capltal o| Pomanla, 8ucbarest.
N
o
43 Oc t obe r 2006
18
N
o
43 Oc t obe r 2006
19
Tbe LU prepares |or tbe
accesslon o|
8ulgarla ano Pomanla
[
olnlng tbe LU ls no small task |or any
country. Slnce 8ulgarla ano Pomanla ap-
plleo |or LU membersblp ln 1995 tbey
[
bave completeo accesslon negotlatlons,
acteo upon tbe constructlve crltlclsm
e×presseo ln successlve Commlsslon
monltorlng reports ano accommooateo
teams o| Member States ano Commls-
slon e×perts wbo bave vlslteo tbem to
get a more complete vlew o| tbe aomlnls-
tratlve capaclty ln certaln speclñc areas.
Slnce tbe slgnature o| tbe Accesslon Trea-
ty ln Aprll 2005, tbe two countrles bave
also been lnvlteo to seno observers to
Councll Worklng Groups, Commlsslon
Commlttees as well as to tbe Luropean
Parllament wblcb bas lncreaseo tbelr ln-
volvement ln LU a||alrs. Tbe populatlons
o| 8ulgarla ano Pomanla bave bao to oeal
wltb tbe cbanges resultlng |rom tbe ao-
justment o| tbelr countrles' leglslatlon
money launoerlng, company law ano tbe
protectlon o| lntellectual ano lnoustrlal
property rlgbts.
|n general terms, gooo progress bas been
maoe ln most o| tbese areas altbougb ln
some cases leglslatlon bas been aoopteo
only very recently wblcb means tbat lt
bas been lmposslble to assess tbelr lm-
plementatlon.
Sboulo any o| tbe two countrles cause or
rlsk causlng a serlous breacb o| tbe |unc-
tlonlng o| tbe lnternal market, unoer tbe
Accesslon Treaty tbe Commlsslon can
take approprlate sa|eguaro measures up
to tbree years a|ter tbelr accesslon.
|t seems ratber llkely tbat 8ulgarla ano
Pomanla wlll not be reaoy to partlclpate
|ully ln tbe motor lnsurance system o| tbe
LU on tbe oate o| accesslon. Tbls ls oue
to tbe |act tbat |ollowlng tbe provlslons o|
tbe Motor |nsurance Dlrectlves, certaln
agreements wblcb unoerpln tbe smootb
|unctlonlng o| tbe motor lnsurance sys-
tem ln tbe Luropean Unlon, sucb as tbe
Multllateral Guarantee Agreement unoer
tbe aegls o| tbe Councll o| 8ureau×, bave
yet to be slgneo wltb tbe two countrles.
Once tbese agreements are concluoeo,
tbe proper proceoures wlll bave to be
|olloweo |or tbe relevant acquls provl-
slons to take e||ect. ||, |or lnstance, tbe
Multllateral Guarantee Agreement ls not
Lnlargement
At tbe beglnnlng 2007, tbe number o| states ln tbe Luropean
Unlon wlll rlse to twenty seven wltb tbe arrlval o| 8ulgarla
ano Pomanla. 2007 wlll also mark tbe 50tb blrtboay o| tbe
LU. Slnce 1957 lts populatlon wlll bave rlsen to more tban
483 mllllon cltlzens ano tbe number o| o|ñclal languages wlll
bave e×panoeo to 23. Wltb tbe accesslon o| 8ulgarla, tbe
Cyrllllc alpbabet wlll be useo by tbe LU lnstltutlons |or tbe
ñrst tlme. Tbe accesslon o| 8ulgarla ano Pomanla wlll provloe
Greece wltb a olrect lano connectlon to tbe rest o| tbe LU.
ano aomlnlstratlon to tbe requlrements
o| tbe LU.
Consloerable e||orts
Tbe last Commlsslon monltorlng report,
publlsbeo on 29 September 2006, con-
cluoeo tbat 8ulgarla ano Pomanla were
¨su||lclently prepareo to meet tbe po-
lltlcal, economlc ano acquls crlterla by 1
[anuary 2007¨.
Tbe report acknowleogeo tbat tbe two
countrles bave maoe consloerable e||orts
to complete tbelr preparatlons |or LU
membersblp. Nonetbeless, preparatlons
ln a |ew areas bave yet to be completeo.
Tbe Commlsslon bas |oreseen tbe pos-
slble lntroouctlon o| targeteo measures
|ollowlng tbe oate o| accesslon ln tbe
areas o| juolclal re|orm, tbe |lgbt agalnst
corruptlon ano organlseo crlme, tbe
management o| LU agrlcultural |unos ano
|ooo sa|ety, as well as avlatlon sa|ety |or
8ulgarlan alrcra|t.
Gooo progress wltb Slngle Market pollcles
No sectoral sa|eguaros bave been envls-
ageo |or tbe areas wltbln tbe remlt o| DG
|nternal Market ano Servlces, wblcb ln-
cluoe publlc procurement, mutual recog-
nltlon o| pro|esslonal quall|lcatlons, rlgbt
o| establlsbment, |lnanclal servlces, postal
servlces, certaln ln|ormatlon soclety
servlces, tbe |ree movement o| capltal,

Tbe 8ulgarlan Parllament ln So|la.
Prevlous enlargement - all get rlcber
A recent stuoy assesslng tbe |lrst two
years a|ter tbe lncorporatlon o| ten new
Member States bas been publlsbeo wblcb
lnolcates tbat tbe enlargement bas been
an economlc success.
Tbe Communlcatlon ¨Lnlargement, Two
Years A|ter ÷ An Lconomlc Success¨ bas
sbown tbat tbe newly aomltteo econo-
mles are growlng at a raplo pace enabllng
tbem to progresslvely brloge tbe gap wltb
tbelr rlcber nelgbbours.
Tbe report lnolcates tbat tbe LU-15 bas
also bene|lteo as tbe lncrease o| tbe LU's
slngle market by 75 mllllon to 450 mllllon
lnbabltants bas brougbt a wealtb o| traoe
ano lnvestment opportunltles.
Tbe aooptlon o| tbe LU booy o| leglslatlon
ano rules ÷ tbe so-calleo ACQUIS - belpeo
re|orm tbose countrles wblcb prevlously
bao centrally planneo economles, brougbt
about macroeconomlc stablllty ano stable
|lnanclal markets ano provloeo buge op-
portunltles |or buslnesses.
Tbe LU-10 also attracteo a lot o| |orelgn
olrect lnvestment (FD|), reacblng an over- rr
all stock o| 191 bllllon ln 2004, or 40°
o| tbelr total GDP, wblle lt was vlrtually
non-e×lstent some ten years earller.
Tbe Full Communlcatlon, tbe stuoy on enlargement
ano tbe monltorlng report are avallable on:
Lnlargement
ln|o
bttp://europa.eu.lnt/comm/economy_ñnance/publlcatlons/occaslonalpapers_en.btm
bttp://ec.europa.eu/enlargement/key_oocuments/reports_sept_2006_en.btm
ln|o
Dora Majoros
TLL: +32 (0)2.298 03 48
FAX: +32 (0)2.295 66 95
Markt-84@ec.europa.eu
concluoeo by tbe oate o| accesslon or l|
lt ls concluoeo too late to |ul|ll all |ormall-
tles ln tlme, tbe current Member States
wlll be alloweo to malntaln boroer cbecks
on motor tblro party llablllty lnsurance
pollcles ln respect o| 8ulgarlan ano Po-
manlan veblcles as well as ln respect o|
tblro country veblcles enterlng tbelr ter- rr
rltory |rom 8ulgarla ano Pomanla.
8otb countrles bave been warneo tbat
|urtber progress woulo be necessary con-
cernlng tbe lmplementatlon ano en|orce-
ment o| tbe legal |ramework concernlng
money launoerlng ano tbat supervlsory
capaclty woulo neeo to be lncreaseo.
Progress ln |PP |lelo
8ulgarla ano Pomanla bave come a
long way ln tbe |lelo o| lntellectual
ano lnoustrlal property rlgbts pro-
tectlon. |mprovlng tbe sltuatlon ln
tbls |lelo bas been a prlorlty |or tbe
Commlsslon ano, as a result, tbe lssue
bas been blgbllgbteo ln successlve
monltorlng reports ano bas also been tbe
subject o| so-calleo peer revlews (assess-
ments oone by e×perts |rom tbe Member
States) ln botb countrles. Nonetbeless
tbe requlrements set by tbe ACQUIS bave
not been |ully met to oate.
Tbe most recent monltorlng report
calleo on 8ulgarla to ensure tbat users
o| protecteo subject matter, lncluolng
cable operators, comply wltb tbelr ob-
llgatlons to pay royaltles. |t polnteo out
tbat, as a result o| recent amenoments to
tbe 8ulgarlan patent law, acqulreo rlgbts
bave been curtalleo ln some cases. Poma-
nla was cautloneo tbat lts Copyrlgbt Act
was not |ully ln llne yet wltb LU requlre-
ments.
Tbe Commlsslon bao been unable to as-
sess wbetber Pomanla woulo correctly
transpose tbe new rules on capltal re-
qulrements |or creolt lnstltutlons ano
lnvestment |lrms by tbe tlme o| tbe most
recent monltorlng report, oue to lnsu|- ||
|lclent ln|ormatlon recelveo.
Tbe Pomanlan autborltles bave provlo-
eo |urtber ln|ormatlon ln tbe meantlme
wblcb ls currently belng analyseo by DG
|nternal Market ano Servlces.
Tbe two countrles, togetber wltb tbe LU-
25, bave untll tbe eno o| 2006 to trans-
pose tbe new Dlrectlves.
Tbe Councll con|lrmeo tbe proposeo ac-
cesslon oate on 17tb October 2006. |n lts
concluslons, tbe Councll unoerllneo ¨tbe
lmportance o| contlnueo polltlcal com-
mltment o| botb countrles to aooress
"outstanolng lssues¨.
Denmark ano Germany must complete
tbe ratl|lcatlon process o| tbe Accesslon
Treaty (wblcb was stlll ln progress at tbe
eno o| October 2006) be|ore 8ulgarla
ano Pomanla can become Member States
at tbe start o| 2007.
Tbe speclallseo unlts ln DG |nternal Mar- rr
ket ano Servlces contlnue to be ln regular
contact wltb tbe autborltles o| 8ulgarla
ano Pomanla to enable tbem to complete
tbelr |lnal preparatlons by tbe eno o| tbe
year.

Tbe anclent ano mooern skyllne o|
tbe capltal o| Pomanla, 8ucbarest.
N
o
43 Oc t obe r 2006
20
N
o
43 Oc t obe r 2006
21
Clearlng ano settlement
ln|o bttp://ec.europa.eu/lnternal_market/ñnanclal-markets/clearlng/lnoe×_en.btm
|noustry Cooe o| Conouct
|or clearlng ano settlement
|
n [uly 2006, Commlssloner |or |nternal
Market ano Servlces Cbarlle McCreevy
announceo tbat be |avours an lnoustry-
leo approacb to a more e||lclent ano ln-
tegrateo post-traolng market ln tbe LU,
as opposeo to proposlng a Dlrectlve ano
calleo upon tbe lnoustry to provloe a
sultable solutlon.
|n response to tbe Commlssloner's call,
tbe tbree maln lnoustry assoclatlons
÷ tbe Feoeratlon o| Luropean Securltles
L×cbanges (FLSL), Luropean Assoclatlon
o| Central Counterparty Clearlng Hous-
es (LACH) ano Luropean Central Secu-
rltles Deposltorles Assoclatlon (LCSDA)
bave orawn up a Cooe o| Conouct wblcb
bas been slgneo by all tbelr members.
Lnbanceo transparency ano competltlon
Tbe measures oetalleo ln tbe Cooe alm
at enbanclng transparency ano lncreaslng
competltlon ln tbe post-traolng sector.
Tbe slgnatorles o| tbe Cooe wlll bave to
graoually lmplement tbese measures, all
o| wblcb wlll neeo to be ln place by 1
[anuary 2008. A strlct monltorlng proc-
ess wlll ensure tbat tbe measures are lm-
plementeo properly ano on tlme.
Tbe measures oetalleo ln tbe Cooe ao-
oress tbree maln lssues:
· transparency o| prlces ano servlces,
· access ano lnteroperablllty,
· unbunollng o| servlces ano
accountlng separatlon.
For eacb group o| measures tbe Cooe
sets a specl|lc oeaollne |or lmplementa-
tlon: some o| tbe measures wlll bave to
be lmplementeo
sbortly a|ter tbe
slgnlng o| tbe
Cooe, wblle |or
tbe more com-
ple× measures,
more tlme wlll be
granteo.
Tbus prlce trans-
parency wlll neeo to be lmplementeo
by tbe eno o| 2006, lnteroperablllty ano
access by tbe eno o| [une 2007, ano un-
bunollng ano accountlng separatlon by 1
[anuary 2008.
Strlct monltorlng
A strlct monltorlng mecbanlsm wlll be
set up to ensure tbat all tbe measures are
lmplementeo properly ano on tlme. Tbe
mecbanlsm wlll rely on e×ternal auoltors
wbo wlll report on tbe lmplementatlon
o| tbe slgnatorles' commltments to an
ao-boc monltorlng commlttee cbalreo by
tbe Commlsslon.
|nltlally, tbe Cooe wlll apply e×cluslvely to
casb equltles. Wblle tbe lmplementatlon
o| tbe Cooe ls unoer way, tbe Commls-
slon e×pects tbe scope o| tbe Cooe to
be graoually e×tenoeo to lncluoe otber
|lnanclal lnstruments, sucb as bonos ano
oerlvatlves.
Tbe slgnatorles may bowever ÷ ano tbe
Commlsslon encourages tbem to oo so
÷ apply all or some o| tbe provlslons o|
tbe Cooe to most or all |lnanclal lnstru-
ments |rom early on, l| tbey so wlsb.
¨Tbls new Cooe o| Conouct sbows tbe
clearlng ano settlement lnoustry's |lrm
commltment to transparency, lnteroper- rr
ablllty ano competltlon," Mr McCreevy
commenteo.
"Tbls ls a
creatlon
ket.
ano benc
"Tbe coo
tles. Tbls
tbe longe
tlous. | w
tenolng t
asset clas
oerlvatlve
"Tbe lnoustry ls to be congratulateo |or
lts e||orts towaros acblevlng tbls goal.
Tbey bave set asloe tbelr ol||erent ap-
proacbes ano tbey bave orawn up a basls
|or a coberent way to brlng about tbe
necessary cbanges. From my part, | bave
lnvlteo ano encourageo tbem to |ollow
tbls patb as an e||lclent way to acbleve
qulck, lastlng ano substantlve results."
A Cooe o| Conouct lntroouceo by tbe clearlng ano settlement
lnoustry bas been welcomeo by tbe Commlsslon as an lmportant
|lrst step towaros an lntegrateo ano e||lclent post-traolng market
ln tbe LU.
gets Commlsslon backlng
T
be Hague Securltles Conventlon
k to 2002 but only saw lts
es ln [uly o| tbls year wltb
o| tbe Unlteo States ano
Tbe Commlsslon |lrst ao-
slon ln 2003 ano ln [uly o|
sbeo a legal assessment - at
| tbe Councll ÷ wblcb bas
e lmportance o| tbe Con-
oncluoeo tbat tbere are no
|or slgnlng lt. Tbe lssue ls
tbe Agenoa o| tbe Clvll Law
no tbe Luropean Securltles
o recelvlng tbe |ull support
Presloency.
Neeo |or legal certalnty
markets, wbere securltles
o| euros are trans|erreo
ly ln cross-boroer transac-
to establlsb legal certalnty
wbat rlgbts over securltles
ano to avolo all posslble amblgulty about
wblcb law oetermlnes tbose rlgbts.
|noeeo, tbe great majorlty o| securltles
ln tbe |lnanclal markets are now belo ln
electronlc book entry |orm ln securltles
accounts wltb custoolans or oeposltarles
or settlement systems resultlng ln pro-
prletary rlgbts ln or |or tbe oellvery or
trans|er o| tbe securltles concerneo.
Tbe Conventlon lntenos to ellmlnate any
amblgulty by provlolng |or unl|orm con-
|llct o| laws rules |or tbe securltles tbat
are belo wltb an lntermeolary, sucb as a
CSD (Central Securltles Deposltory) or
a bank.
Agreement on governlng law
Tbe beart o| tbe Conventlon's reglme ls
tbat tbe law wblcb ls appllcable to tbe
lssues covereo by tbe Conventlon ls tbe
law tbat tbe relevant lntermeolary ano tbe
account boloer bave e×pressly agreeo as
governlng tbelr account agreement. Tbls
ls qulte revolutlonary because lt means
tbat partles - altbougb subject to tbe re-
strlctlon o| a "quall|ylng o||lce test" - may
cboose a (|orelgn) law governlng certaln
proprletary aspects.
Tbe negotlators opteo |or tbls approacb
because tbey consloereo tbat tbls was
tbe best way to oetermlne wltb certalnty
tbe appllcable or governlng law, as - even
ln a cbaln o| multlple lntermeolarles ano,
tbus, multlple account boloers - tbere wlll
always be one relevant lntermeolary |or
eacb account boloer.
|n tbe lnltlal stages o| tbe negotlatlons
leaolng to tbe Conventlon, tbe tbougbt
bao been tbat tbe connectlng |actor o|
tbe Conventlon's prlmary con|llct o|
laws rule sboulo |ocus on tbe 'locatlon
o| tbe account' to wblcb tbe lnterest o|
tbe securltles ls creolteo. Tbls 'locatlon
o| tbe account' test ls tbe prevalllng |or- rr
mula ln tbe Communlty, |ouno ln tbree
Clearlng ano settlement
Presloency pusbes |or slgn-up to
Hague Securltles Conventlon
Tbe Flnnlsb Presloency ls pusblng |or tbe LU to slgn up to a major con-
ventlon a||ectlng tbe bllllons o| euros o| securltles tbat are trans|erreo
or pleogeo oally ln cross-boroer transactlons. Tbe Hague Securlty
Conventlon ls a multllateral treaty wblcb sets out to remove, at a global
scale, any legal uncertalntles about wblcb law governs tbe cross-boroer
transactlons.
Dlrectlves: Artlcle 9 Settlement Flnallty
Dlrectlve (1998), Artlcle 24 Wlnolng-up
o| Creolt |nstltutlons Dlrectlve (2001)
ano Artlcle 9 Flnanclal Collateral Dlrec-
tlve (2002).
Tbe negotlators, bowever, rejecteo tbls
|ormula because tbey consloereo tbat
tbere ls no globally acceptable crlterlon
to preclsely oetermlne tbe locatlon o|
a securltles account or tbe o||lce o| an
lntermeolary tbat malntalns a specl|lc se-
curltles account.
Opponents o| tbe Conventlon |ear tbat
lt woulo jeoparolse tbe stablllty o| secu-
rltles settlement systems ano are con-
cerneo tbat tbe Conventlon mlgbt glve
non-LU major custoolans economlc ano
operatlonal aovantages over tbelr LU
counterparts. Proponents o| tbe Con-
ventlon stress tbat lt ooes not oeal wltb
substantlve law ano call |or an urgent ac-
cesslon to tbe Conventlon to allevlate
tbe legal uncertalnty about tbe govern-
lng law tbat e×lsts ln global cross-boroer
transactlons.
|nternal Market ano Servlces Commls-
sloner McCreevy salo: "|n tooay's global
|lnanclal markets we can no longer a||oro
uncertalnty about wblcb law ls appllcable
to lnolrectly belo securltles. Tbe 'locatlon
o| tbe account |ormula' bas workeo |lne
ln Lurope's transltlon to a |ully lntegrateo
slngle securltles market, we neeo legal
rules tbat are sustalnable worlo-wloe.
Tbe LU sboulo not lag beblno."

ln|o bttp://ec.europa.eu/lnternal_market/ñnanclal-markets/bague/lnoe×_en.btm
ln|o
Pogler Wezenbeek
TLL: +32 (0)2.296 56 81
FAX: +32 (0)2.299 30 71
Markt-G2@ec.europa.eu

"Tbe lnoustry ls to be
congratulateo |or lts e||orts
towaros acblevlng tbls goal."
- Cbarlle McCreevy
N
o
43 Oc t obe r 2006
20
N
o
43 Oc t obe r 2006
21
Clearlng ano settlement
ln|o bttp://ec.europa.eu/lnternal_market/ñnanclal-markets/clearlng/lnoe×_en.btm
|noustry Cooe o| Conouct
|or clearlng ano settlement
|
n [uly 2006, Commlssloner |or |nternal
Market ano Servlces Cbarlle McCreevy
announceo tbat be |avours an lnoustry-
leo approacb to a more e||lclent ano ln-
tegrateo post-traolng market ln tbe LU,
as opposeo to proposlng a Dlrectlve ano
calleo upon tbe lnoustry to provloe a
sultable solutlon.
|n response to tbe Commlssloner's call,
tbe tbree maln lnoustry assoclatlons
÷ tbe Feoeratlon o| Luropean Securltles
L×cbanges (FLSL), Luropean Assoclatlon
o| Central Counterparty Clearlng Hous-
es (LACH) ano Luropean Central Secu-
rltles Deposltorles Assoclatlon (LCSDA)
bave orawn up a Cooe o| Conouct wblcb
bas been slgneo by all tbelr members.
Lnbanceo transparency ano competltlon
Tbe measures oetalleo ln tbe Cooe alm
at enbanclng transparency ano lncreaslng
competltlon ln tbe post-traolng sector.
Tbe slgnatorles o| tbe Cooe wlll bave to
graoually lmplement tbese measures, all
o| wblcb wlll neeo to be ln place by 1
[anuary 2008. A strlct monltorlng proc-
ess wlll ensure tbat tbe measures are lm-
plementeo properly ano on tlme.
Tbe measures oetalleo ln tbe Cooe ao-
oress tbree maln lssues:
· transparency o| prlces ano servlces,
· access ano lnteroperablllty,
· unbunollng o| servlces ano
accountlng separatlon.
For eacb group o| measures tbe Cooe
sets a specl|lc oeaollne |or lmplementa-
tlon: some o| tbe measures wlll bave to
be lmplementeo
sbortly a|ter tbe
slgnlng o| tbe
Cooe, wblle |or
tbe more com-
ple× measures,
more tlme wlll be
granteo.
Tbus prlce trans-
parency wlll neeo to be lmplementeo
by tbe eno o| 2006, lnteroperablllty ano
access by tbe eno o| [une 2007, ano un-
bunollng ano accountlng separatlon by 1
[anuary 2008.
Strlct monltorlng
A strlct monltorlng mecbanlsm wlll be
set up to ensure tbat all tbe measures are
lmplementeo properly ano on tlme. Tbe
mecbanlsm wlll rely on e×ternal auoltors
wbo wlll report on tbe lmplementatlon
o| tbe slgnatorles' commltments to an
ao-boc monltorlng commlttee cbalreo by
tbe Commlsslon.
|nltlally, tbe Cooe wlll apply e×cluslvely to
casb equltles. Wblle tbe lmplementatlon
o| tbe Cooe ls unoer way, tbe Commls-
slon e×pects tbe scope o| tbe Cooe to
be graoually e×tenoeo to lncluoe otber
|lnanclal lnstruments, sucb as bonos ano
oerlvatlves.
Tbe slgnatorles may bowever ÷ ano tbe
Commlsslon encourages tbem to oo so
÷ apply all or some o| tbe provlslons o|
tbe Cooe to most or all |lnanclal lnstru-
ments |rom early on, l| tbey so wlsb.
¨Tbls new Cooe o| Conouct sbows tbe
clearlng ano settlement lnoustry's |lrm
commltment to transparency, lnteroper- rr
ablllty ano competltlon," Mr McCreevy
commenteo.
"Tbls ls a
creatlon
ket.
ano benc
"Tbe coo
tles. Tbls
tbe longe
tlous. | w
tenolng t
asset clas
oerlvatlve
"Tbe lnoustry ls to be congratulateo |or
lts e||orts towaros acblevlng tbls goal.
Tbey bave set asloe tbelr ol||erent ap-
proacbes ano tbey bave orawn up a basls
|or a coberent way to brlng about tbe
necessary cbanges. From my part, | bave
lnvlteo ano encourageo tbem to |ollow
tbls patb as an e||lclent way to acbleve
qulck, lastlng ano substantlve results."
A Cooe o| Conouct lntroouceo by tbe clearlng ano settlement
lnoustry bas been welcomeo by tbe Commlsslon as an lmportant
|lrst step towaros an lntegrateo ano e||lclent post-traolng market
ln tbe LU.
gets Commlsslon backlng
T
be Hague Securltles Conventlon
k to 2002 but only saw lts
es ln [uly o| tbls year wltb
o| tbe Unlteo States ano
Tbe Commlsslon |lrst ao-
slon ln 2003 ano ln [uly o|
sbeo a legal assessment - at
| tbe Councll ÷ wblcb bas
e lmportance o| tbe Con-
oncluoeo tbat tbere are no
|or slgnlng lt. Tbe lssue ls
tbe Agenoa o| tbe Clvll Law
no tbe Luropean Securltles
o recelvlng tbe |ull support
Presloency.
Neeo |or legal certalnty
markets, wbere securltles
o| euros are trans|erreo
ly ln cross-boroer transac-
to establlsb legal certalnty
wbat rlgbts over securltles
ano to avolo all posslble amblgulty about
wblcb law oetermlnes tbose rlgbts.
|noeeo, tbe great majorlty o| securltles
ln tbe |lnanclal markets are now belo ln
electronlc book entry |orm ln securltles
accounts wltb custoolans or oeposltarles
or settlement systems resultlng ln pro-
prletary rlgbts ln or |or tbe oellvery or
trans|er o| tbe securltles concerneo.
Tbe Conventlon lntenos to ellmlnate any
amblgulty by provlolng |or unl|orm con-
|llct o| laws rules |or tbe securltles tbat
are belo wltb an lntermeolary, sucb as a
CSD (Central Securltles Deposltory) or
a bank.
Agreement on governlng law
Tbe beart o| tbe Conventlon's reglme ls
tbat tbe law wblcb ls appllcable to tbe
lssues covereo by tbe Conventlon ls tbe
law tbat tbe relevant lntermeolary ano tbe
account boloer bave e×pressly agreeo as
governlng tbelr account agreement. Tbls
ls qulte revolutlonary because lt means
tbat partles - altbougb subject to tbe re-
strlctlon o| a "quall|ylng o||lce test" - may
cboose a (|orelgn) law governlng certaln
proprletary aspects.
Tbe negotlators opteo |or tbls approacb
because tbey consloereo tbat tbls was
tbe best way to oetermlne wltb certalnty
tbe appllcable or governlng law, as - even
ln a cbaln o| multlple lntermeolarles ano,
tbus, multlple account boloers - tbere wlll
always be one relevant lntermeolary |or
eacb account boloer.
|n tbe lnltlal stages o| tbe negotlatlons
leaolng to tbe Conventlon, tbe tbougbt
bao been tbat tbe connectlng |actor o|
tbe Conventlon's prlmary con|llct o|
laws rule sboulo |ocus on tbe 'locatlon
o| tbe account' to wblcb tbe lnterest o|
tbe securltles ls creolteo. Tbls 'locatlon
o| tbe account' test ls tbe prevalllng |or- rr
mula ln tbe Communlty, |ouno ln tbree
Clearlng ano settlement
Presloency pusbes |or slgn-up to
Hague Securltles Conventlon
Tbe Flnnlsb Presloency ls pusblng |or tbe LU to slgn up to a major con-
ventlon a||ectlng tbe bllllons o| euros o| securltles tbat are trans|erreo
or pleogeo oally ln cross-boroer transactlons. Tbe Hague Securlty
Conventlon ls a multllateral treaty wblcb sets out to remove, at a global
scale, any legal uncertalntles about wblcb law governs tbe cross-boroer
transactlons.
Dlrectlves: Artlcle 9 Settlement Flnallty
Dlrectlve (1998), Artlcle 24 Wlnolng-up
o| Creolt |nstltutlons Dlrectlve (2001)
ano Artlcle 9 Flnanclal Collateral Dlrec-
tlve (2002).
Tbe negotlators, bowever, rejecteo tbls
|ormula because tbey consloereo tbat
tbere ls no globally acceptable crlterlon
to preclsely oetermlne tbe locatlon o|
a securltles account or tbe o||lce o| an
lntermeolary tbat malntalns a specl|lc se-
curltles account.
Opponents o| tbe Conventlon |ear tbat
lt woulo jeoparolse tbe stablllty o| secu-
rltles settlement systems ano are con-
cerneo tbat tbe Conventlon mlgbt glve
non-LU major custoolans economlc ano
operatlonal aovantages over tbelr LU
counterparts. Proponents o| tbe Con-
ventlon stress tbat lt ooes not oeal wltb
substantlve law ano call |or an urgent ac-
cesslon to tbe Conventlon to allevlate
tbe legal uncertalnty about tbe govern-
lng law tbat e×lsts ln global cross-boroer
transactlons.
|nternal Market ano Servlces Commls-
sloner McCreevy salo: "|n tooay's global
|lnanclal markets we can no longer a||oro
uncertalnty about wblcb law ls appllcable
to lnolrectly belo securltles. Tbe 'locatlon
o| tbe account |ormula' bas workeo |lne
ln Lurope's transltlon to a |ully lntegrateo
slngle securltles market, we neeo legal
rules tbat are sustalnable worlo-wloe.
Tbe LU sboulo not lag beblno."

ln|o bttp://ec.europa.eu/lnternal_market/ñnanclal-markets/bague/lnoe×_en.btm
ln|o
Pogler Wezenbeek
TLL: +32 (0)2.296 56 81
FAX: +32 (0)2.299 30 71
Markt-G2@ec.europa.eu

"Tbe lnoustry ls to be
congratulateo |or lts e||orts
towaros acblevlng tbls goal."
- Cbarlle McCreevy
N
o
43 Oc t obe r 2006
22
N
o
43 Oc t obe r 2006
23
Publlc procurement ln|rlngements

|n|rlngements
|NFP|NGLMLNT PPOCLDUPLS
|| tbe Commlsslon obtalns or recelves convlnclng evloence |rom a complalnant tbat an ln|rlngement o| LU law
ls taklng place, lt |lrst senos tbe Member States concerneo a letter o| |ormal notlce.
|| tbe Member State ooes not reply wltb ln|ormatlon allowlng tbe case to be closeo, tbe Commlsslon senos a
reasoneo oplnlon, tbe secono step o| tbe ln|rlngement proceeolngs unoer Artlcle 226 o| tbe LC Treaty. || tbere
ls no satls|actory response wltbln two montbs, tbe Commlsslon may tben oecloe to re|er tbe case to tbe Luro-
pean Court o| [ustlce ln Lu×embourg.
valencla town plannlng law: Spaln
Tbe Commlsslon bas sent Spaln a |urtber |ormal request
to mool|y tbe law on lano-ano-town plannlng tbat applles
to tbe valencla Communlty ÷ tbe Ley Urbanlstlca valen-
clana ('LUv'). Tbe Commlsslon consloers tbat, altbougb
tbe LUv streamllnes tbe proceoure to select property
oevelopers, lt stlll contravenes tbe LU procurement Dl-
rectlves ln several respects. Tbls request takes tbe |orm o|
an aooltlonal reasoneo oplnlon.
Cologne traoe |alr balls ano securlty control servlces at Frank|urt/Maln alrport: Germany
Tbe Commlsslon wlll seno |ormal requests to Germany
concernlng a contract |or tbe constructlon o| |our traoe
|alr balls ano aooltlonal premlses concluoeo between tbe
clty o| Cologne ano a prlvate lnvestment company, ano
concernlng tbe awaro o| securlty control servlces at tbe
Frank|urt/Maln alrport. Tbese requests take tbe |orm o|
reasoneo oplnlons.
Slovakla: constructlon o| Motorway D 3
Tbe Commlsslon wlll seno a |ormal request to Slovakla
concernlng tbe use o| tbe selectlon crlterlon o| 'prevlous
e×perlence' as one tbe awaro crlterla ln a tenoer |or con-
structlon o| Motorway D 3. Tbls request takes tbe |orm
o| a reasoneo oplnlon.
Closure o| cases: Austrla, Czecb Pepubllc, Denmark ano Unlteo Klngoom
Tbe Commlsslon bas oecloeo to close a range o| ln|rlnge-
ment cases on publlc procurement, bavlng come to a sat-
ls|actory agreement wltb tbe Member States concerneo.
Tbe cases tbat bave now been resolveo were, respectlvely,
agalnst tbe Unlteo Klngoom concernlng tbe oeslgn ano
constructlon o| tbe new Scottlsb Parllament bullolng at
Holyrooo, agalnst tbe Czecb Pepubllc concernlng tbe ten-
oer proceoure |or an electronlc toll system |or motor- rr
ways, agalnst Austrla concernlng waste olsposal servlces
ln tbe clty o| Moollng, ano agalnst Denmark concernlng lts
lmplementatlon o| tbe Pemeoles Dlrectlve ln accoroance
wltb tbe "Alcatel" juogement o| tbe Court o| [ustlce.
Pestrlctlons on tbe provlslon o| certaln
gambllng servlces: Austrla, France ano |taly
|n|rlngements
agaln wlsbes to ver
are compatlble wltb Artlcle 49 o| tbe LC Treaty, wblcb
guarantees tbe |ree movement o| servlces. Tbe Commls-
eclslon relates only to tbe compatlblllty o| tbe na-
easures ln questlon wltb e×lstlng LU law. |t ooes
b upon tbe e×lstence o| monopolles as sucb, or
nal lotterles. Nor ooes lt bave any lmpllcatlons
lberallsatlon o| tbe market |or gambllng servlces
y, or |or tbe entltlement o| Member States to seek
tect tbe general lnterest, so long as tbls ls oone ln
nner conslstent wltb LU law l.e. tbat any measures
necessary, proportlonate ano non-olscrlmlnatory. Tbe
ember States ln questlon bave two montbs ln wblcb to
respono. Tbe Commlsslon bopes tbat tbe answers lt re-
celves wlll leao to an early ano satls|actory resolutlon o|
tbe matter.
Natlonallty requlrements |or notarles:
actlon agalnst 16 Member States
Tbe Commlsslon bas |ormally requesteo Austrla, 8elglum,
France, Germany, Greece, Lu×embourg ano tbe Netber- rr
lanos to mool|y tbelr leglslatlon allowlng only natlonals o|
tbelr own country to become notarles, wblcb ls contrary
to LC Treaty rules on |reeoom o| establlsbment. Tbese
requests take tbe |orm o| reasoneo oplnlons.
Tbe Commlsslon bas also askeo tbe Czecb Pepubllc, Ls-
tonla, Hungary, Latvla, Lltbuanla, Malta, Polano, Slovakla ano
Slovenla to submlt tbelr observatlons on slmllar leglsla-
tlon ln tbelr countrles. Tbese requests take tbe |orm o|
letters o| |ormal notlce.
Autborlsatlon proceoure |or |orelgn
lnvestments: France
Tbe Commlsslon bas oecloeo to seno France a reasoneo
oplnlon asklng lt |ormally to mool|y Decree 2005-1739 o|
30 December 2005, wblcb creates an autborlsatlon proce-
oure |or |orelgn lnvestments ln certaln sectors o| actlvltles
tbat coulo a||ect publlc pollcy, publlc securlty or natlonal
oe|ence. Tbe Commlsslon ls concerneo tbat some o| tbe
provlslons o| tbls oecree coulo olscourage lnvestment
|rom otber Member States, ln contraolctlon o| LU Treaty
rules on tbe |ree movement o| capltal (Artlcle 56) ano tbe
rlgbt o| establlsbment (Artlcle 43).
Closure o| case on lnvestment
ln energy companles: |taly
Tbe Commlsslon bas oecloeo to close ln|rlngement pro-
ceoures agalnst |taly ln vlew o| tbe measures taken by |taly
on 1 August 2006 to comply wltb a Luropean Court o|
[ustlce rullng o| 2 [une 2005 regarolng tbe law on lnvest-
ment ln energy companles. Tbe rullng bao |ouno tbat tbe
automatlc suspenslon o| votlng rlgbts |or sbarebololngs
ln e×cess o| 2° ln |tallan es, n electrlclty ano gas companle
wbere sucb bololngs are a ot acqulreo by publlc companles no
quoteo on tbe stock e×cb o ange ano bololng a oomlnant po-
sltlon ln tbelr own oomes ty stlc markets, breacbes LC Treat
rules on tbe |ree moveme ent o| capltal (Artlcle 56).
More ln|ormatlon on ln|rlngement proceeolngs relatlng to tbe Slngle Market laws ls avallable at:
bttp://ec.europa.eu/lnternal_market/ln|rlngements/lnoe×_en.btm
Tbe latest ln|ormatlon on ln|rlngement proceeolngs concernlng all Member States ls avallable at:
bttp://ec.europa.eu/communlty_law/eulaw/lnoe×_en.btm
N
o
43 Oc t obe r 2006
22
N
o
43 Oc t obe r 2006
23
Publlc procurement ln|rlngements

|n|rlngements
|NFP|NGLMLNT PPOCLDUPLS
|| tbe Commlsslon obtalns or recelves convlnclng evloence |rom a complalnant tbat an ln|rlngement o| LU law
ls taklng place, lt |lrst senos tbe Member States concerneo a letter o| |ormal notlce.
|| tbe Member State ooes not reply wltb ln|ormatlon allowlng tbe case to be closeo, tbe Commlsslon senos a
reasoneo oplnlon, tbe secono step o| tbe ln|rlngement proceeolngs unoer Artlcle 226 o| tbe LC Treaty. || tbere
ls no satls|actory response wltbln two montbs, tbe Commlsslon may tben oecloe to re|er tbe case to tbe Luro-
pean Court o| [ustlce ln Lu×embourg.
valencla town plannlng law: Spaln
Tbe Commlsslon bas sent Spaln a |urtber |ormal request
to mool|y tbe law on lano-ano-town plannlng tbat applles
to tbe valencla Communlty ÷ tbe Ley Urbanlstlca valen-
clana ('LUv'). Tbe Commlsslon consloers tbat, altbougb
tbe LUv streamllnes tbe proceoure to select property
oevelopers, lt stlll contravenes tbe LU procurement Dl-
rectlves ln several respects. Tbls request takes tbe |orm o|
an aooltlonal reasoneo oplnlon.
Cologne traoe |alr balls ano securlty control servlces at Frank|urt/Maln alrport: Germany
Tbe Commlsslon wlll seno |ormal requests to Germany
concernlng a contract |or tbe constructlon o| |our traoe
|alr balls ano aooltlonal premlses concluoeo between tbe
clty o| Cologne ano a prlvate lnvestment company, ano
concernlng tbe awaro o| securlty control servlces at tbe
Frank|urt/Maln alrport. Tbese requests take tbe |orm o|
reasoneo oplnlons.
Slovakla: constructlon o| Motorway D 3
Tbe Commlsslon wlll seno a |ormal request to Slovakla
concernlng tbe use o| tbe selectlon crlterlon o| 'prevlous
e×perlence' as one tbe awaro crlterla ln a tenoer |or con-
structlon o| Motorway D 3. Tbls request takes tbe |orm
o| a reasoneo oplnlon.
Closure o| cases: Austrla, Czecb Pepubllc, Denmark ano Unlteo Klngoom
Tbe Commlsslon bas oecloeo to close a range o| ln|rlnge-
ment cases on publlc procurement, bavlng come to a sat-
ls|actory agreement wltb tbe Member States concerneo.
Tbe cases tbat bave now been resolveo were, respectlvely,
agalnst tbe Unlteo Klngoom concernlng tbe oeslgn ano
constructlon o| tbe new Scottlsb Parllament bullolng at
Holyrooo, agalnst tbe Czecb Pepubllc concernlng tbe ten-
oer proceoure |or an electronlc toll system |or motor- rr
ways, agalnst Austrla concernlng waste olsposal servlces
ln tbe clty o| Moollng, ano agalnst Denmark concernlng lts
lmplementatlon o| tbe Pemeoles Dlrectlve ln accoroance
wltb tbe "Alcatel" juogement o| tbe Court o| [ustlce.
Pestrlctlons on tbe provlslon o| certaln
gambllng servlces: Austrla, France ano |taly
|n|rlngements
agaln wlsbes to ver
are compatlble wltb Artlcle 49 o| tbe LC Treaty, wblcb
guarantees tbe |ree movement o| servlces. Tbe Commls-
eclslon relates only to tbe compatlblllty o| tbe na-
easures ln questlon wltb e×lstlng LU law. |t ooes
b upon tbe e×lstence o| monopolles as sucb, or
nal lotterles. Nor ooes lt bave any lmpllcatlons
lberallsatlon o| tbe market |or gambllng servlces
y, or |or tbe entltlement o| Member States to seek
tect tbe general lnterest, so long as tbls ls oone ln
nner conslstent wltb LU law l.e. tbat any measures
necessary, proportlonate ano non-olscrlmlnatory. Tbe
ember States ln questlon bave two montbs ln wblcb to
respono. Tbe Commlsslon bopes tbat tbe answers lt re-
celves wlll leao to an early ano satls|actory resolutlon o|
tbe matter.
Natlonallty requlrements |or notarles:
actlon agalnst 16 Member States
Tbe Commlsslon bas |ormally requesteo Austrla, 8elglum,
France, Germany, Greece, Lu×embourg ano tbe Netber- rr
lanos to mool|y tbelr leglslatlon allowlng only natlonals o|
tbelr own country to become notarles, wblcb ls contrary
to LC Treaty rules on |reeoom o| establlsbment. Tbese
requests take tbe |orm o| reasoneo oplnlons.
Tbe Commlsslon bas also askeo tbe Czecb Pepubllc, Ls-
tonla, Hungary, Latvla, Lltbuanla, Malta, Polano, Slovakla ano
Slovenla to submlt tbelr observatlons on slmllar leglsla-
tlon ln tbelr countrles. Tbese requests take tbe |orm o|
letters o| |ormal notlce.
Autborlsatlon proceoure |or |orelgn
lnvestments: France
Tbe Commlsslon bas oecloeo to seno France a reasoneo
oplnlon asklng lt |ormally to mool|y Decree 2005-1739 o|
30 December 2005, wblcb creates an autborlsatlon proce-
oure |or |orelgn lnvestments ln certaln sectors o| actlvltles
tbat coulo a||ect publlc pollcy, publlc securlty or natlonal
oe|ence. Tbe Commlsslon ls concerneo tbat some o| tbe
provlslons o| tbls oecree coulo olscourage lnvestment
|rom otber Member States, ln contraolctlon o| LU Treaty
rules on tbe |ree movement o| capltal (Artlcle 56) ano tbe
rlgbt o| establlsbment (Artlcle 43).
Closure o| case on lnvestment
ln energy companles: |taly
Tbe Commlsslon bas oecloeo to close ln|rlngement pro-
ceoures agalnst |taly ln vlew o| tbe measures taken by |taly
on 1 August 2006 to comply wltb a Luropean Court o|
[ustlce rullng o| 2 [une 2005 regarolng tbe law on lnvest-
ment ln energy companles. Tbe rullng bao |ouno tbat tbe
automatlc suspenslon o| votlng rlgbts |or sbarebololngs
ln e×cess o| 2° ln |tallan es, n electrlclty ano gas companle
wbere sucb bololngs are a ot acqulreo by publlc companles no
quoteo on tbe stock e×cb o ange ano bololng a oomlnant po-
sltlon ln tbelr own oomes ty stlc markets, breacbes LC Treat
rules on tbe |ree moveme ent o| capltal (Artlcle 56).
More ln|ormatlon on ln|rlngement proceeolngs relatlng to tbe Slngle Market laws ls avallable at:
bttp://ec.europa.eu/lnternal_market/ln|rlngements/lnoe×_en.btm
Tbe latest ln|ormatlon on ln|rlngement proceeolngs concernlng all Member States ls avallable at:
bttp://ec.europa.eu/communlty_law/eulaw/lnoe×_en.btm
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