2009 Nov Newsletter Aeip

NEWSLETTER

23 – 27/11/2009

TABLE OF CONTENTS EU / FINANCIAL SERVICES ..................................................................................... 2 AIFM needs 'lots of changes' ......................................................................................... 2 Kroes tells pension funds to confront corporate misbehaviour ....................................... 3 Decisions directly affecting financial groups by European supervision authorities.......... 3

EU / INTERNAL MARKET ......................................................................................... 4 New raft of infringement proceedings............................................................................. 4 Commission takes action against Germany (care insurance)......................................... 4

EU / HEALTH ............................................................................................................. 5 Recession sparks mental health crisis ........................................................................... 5

EU / SOCIAL .............................................................................................................. 6 Commission takes action to guarantee UK benefits for citizens residing abroad............ 6

ECONOMY ................................................................................................................. 7 Pensions threatened by six-hour daily longevity increase .............................................. 7 BusinessEurope hopes for greater flexibility from China on exchange rate policy .......... 8 ECOFIN: Towards a better articulated Lisbon Strategy post-2010 ................................. 9

OTHER NEWS AND EVENTS ................................................................................. 10 Leterme replaces Van Rompuy as Belgian PM............................................................ 10 Finland's Rehn set to win top EU economy job ............................................................ 11

CEIOPS’ NEWS ....................................................................................................... 12 CEIOPS NEWS ALERT – 25.11.2009 ......................................................................... 12

EU / COURT OF JUSTICE....................................................................................... 13 Calendar of the Court of Justice................................................................................... 13

THE ANALYSIS IN DEPTH...................................................................................... 14 Decisions directly affecting financial groups by European supervision authorities........ 14 New raft of infringement proceedings........................................................................... 16

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NEWSLETTER

23 – 27/11/2009

_____________________________________________________________________________________ EU / FINANCIAL SERVICES ______________________________________________________________________________________ AIFM needs 'lots of changes' Sharon Bowles, Chair of the Committee on Economic and Monetary Affairs at the European Parliament, said the Alternative Investment Fund Managers (AIFM) directive needs “a lot of changes” as she fears it could make pensions unaffordable in its current form.

Speaking at the EFRP conference in Frankfurt

mooted restrictions on private placements,

earlier this week, Bowles told delegates a

noting "but these are just a couple of many

pension fund representative had informed the

problems”. Other speakers at the conference

European Parliament earlier this month that a

also cautioned the European Union to ensure

reduced yield from the adaptation of the

they do not take rash actions when it comes to

portfolio to AIFM requirements would lead to a

regulatory measures. Willem Handels, vice

10% contribution rise. “Nothing is so risky for the

chairman of the European Pensions Forum,

consumer as not to be able to afford their

BusinessEurope, asked the Commission not to

pension,” she pointed out. “The current proposal

review pension fund regulations separately but

for an AIFM directive creates both a prison and

“to take a broader look at retirement provision

a fortress Europe for investments.” One of the

and its sustainability as well as national

points that needs changes is the “depositary

regulations”. And Patrick Burke, director of

liability”,

was

Investment Development at Irish Life Investment

“superficially attractive” but if securities have to

Managers, pointed out that he has “yet to see a

be held by law in a depositary in a third country

solid business case for a harmonisation of

the relative stability of this country is going to be

quantitative measures for the pension sector” in

priced into the return, she argued. And as the

Europe as it had to remain flexible for

need for insurance would increase prices in the

differences on a national level. In an evening

sector “investing in riskier countries could feed

lecture on the EU’s suggestions on a new

through to all investors, even to those not

European supervisory structure, Jacques De

invested in these countries or deter investors

Laroisière also stressed: “What we need is not

from some third countries altogether”. “A due

necessarily

diligence regime is the better solution,” Bowles

intelligent, adapted regulations.”

pointed out. She also voiced scepticism on

(IPE.com, 20/11/2009)

Bowles

explained.

This

2

more

regulations

but

more

NEWSLETTER

23 – 27/11/2009

Kroes tells pension funds to confront corporate misbehaviour Pension funds have a responsibility to help keep banks on the straight and narrow, says Neelie Kroes, European Commissioner for Competition.

Kroes made her remarks last week at a

denounce

symposium

corporations they invest in.

on

responsible

investing

corporate

misbehaviour

in

In this regard

organized by APG, the asset management

pension funds should give voice to the

daughter of giant public pension scheme ABP.

concerns and interests of the 'average Joe',

In their role as shareholders, pension funds

according to Kroes: “Think of it as the Dutch

can

their

version of the ‘Main Street versus Wall Street’

behaviour at a much earlier stage than the

debate,” she continued, offering that the

European Commission, as the Commission

Amsterdam business quarter ‘Zuidas’ might

can take action only after court approval,

be considered the Dutch version of Wall

Kroes said. Therefore she calls on pension

Street.

funds to waste no time to confront and

(IPE.com, 20/11/2009)

call

financial

corporations on

Decisions directly affecting financial groups by European supervision authorities The Swedish Presidency is pulling out all the stops to reach political agreement on the micro-economic chapter of the legislative package reforming the European system of financial supervision at the Ecofin Council on Wednesday 3 December. Following the agreement in principle at the end of October on setting up the European Systemic Risk Board, discussion has focused largely on deciding the responsibilities of the three European Supervision Authorities (ESAs) in the banking, insurance and securities sectors, and in particular on their ability to take decisions that override national supervision authorities and apply directly to financial players. The United Kingdom, with support in principle from Central and Eastern European countries, has put its full weight into the battle to weaken the legislative proposals on the table. Some experts feel the British are isolated on texts which require qualified majority in the Council and will be adopted through the co-decision procedure with the European Parliament. (Ed Agence Europe, 25/11/2009)

IN DEPTH ANALYSIS BELOW (page 14)

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23 – 27/11/2009

_______________________________________________________________________________________

EU / INTERNAL MARKET _______________________________________________________________________________________ New raft of infringement proceedings On Friday 20 November 2009, the European Commission decided to pursue infringement proceedings against several member states in relation to public tender, financial services and the supply services. (Ed Agence Europe, 24/11/2009) IN DEPTH ANALYSIS BELOW (page 16)

Commission takes action against Germany (care insurance) The European Commission has taken action to put an end to certain obstacles to the free movement of services in Germany. The Commission will send Germany a reasoned opinion in relation to the rules on its care insurance scheme. Reasoned opinions are the second stage of the infringement procedure laid down in Article 226 of the EC Treaty. If there is no satisfactory reply within two months, the Commission may refer the matter to the European Court of Justice.

The European Commission has decided to send

considers this to be a restriction on the free

a reasoned opinion to Germany in relation to the

movement of services which cannot be justified.

rules

scheme

In fact, it considers that the rule in question is

("gesetzliche Pflegeversicherung"). Whereas a

not necessary either to prevent a risk of

patient in need of care can receive care paid for

seriously undermining the financial balance of

by the care insurance scheme while he is in

the social security system or to ensure the

Germany, such services will not be reimbursed

quality of the care.

to the same level when he temporarily stays in

(Ec.europa.eu, 23/11/2009)

another

on

its

Member

care

State.

insurance

The

Commission

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NEWSLETTER

23 – 27/11/2009

_______________________________________________________________________________________

EU / HEALTH _______________________________________________________________________________________ Recession sparks mental health crisis Demand for mental health services has increased over the past 12 months as people struggle to cope with unemployment, debt, home repossession and threat of redundancy, according to a new study.

The report by the London School of Economics,

doctors cannot see new patients. The tension

the Royal College of Psychiatrists in the UK and

between the need to curb public spending and

the NHS Confederation's Mental Health Network

respond to rising demand for services is likely to

says the psychological impact of the recession

become ever more of an issue as governments

is heaping pressure on health services at a time

struggle to balance budgets in the wake of the

when public spending is being cut. Experts warn

financial

that stress means more people are seeking

Commissioner

help, but health and social service waiting lists

governments against cutting health services and

are growing. Cutbacks in social care are

urged them to step up investment in new health

causing delays in discharge from psychiatric

technologies instead.

hospitals, according to the report, meaning

(Euractiv.com, 23/11/2009)

5

crisis.

Last

month,

Androulla

EU

Vassiliou

Health warned

NEWSLETTER

23 – 27/11/2009

_______________________________________________________________________________________ EU / SOCIAL _______________________________________________________________________________________

Commission takes action to guarantee UK benefits for citizens residing abroad The European Commission has decided to take legal action against the United Kingdom for not paying certain benefits to EU citizens residing abroad.

Under EU rules, Disability Living Allowance,

to receive these benefits even if they live in

Attendance Allowance and Carer's Allowance

another EU country. Now, to receive these

are

benefits',

benefits, British authorities require the claimant

meaning people covered by the UK system

to have spent 26 of the previous 52 weeks in

residing in another EU country are also entitled

the UK (past presence test). This requirement

to receive them. On 9 October 2009, the

goes against the European rules coordinating

Commission addressed a Letter of Formal

social

Notice to the UK authorities. The British

Commission's decision to start an infringement

authorities have two months to respond. This is

procedure. It is the role of the European

the first stage of what is called an infringement

Commission, as the guardian of the European

procedure. In the UK system, these three

treaties,

benefits are provided to people who need help

administrative practices that are not in line with

with personal care and to the people who look

Community law. Nevertheless, it is important to

after them. The European Court of Justice has

bear in mind that addressing a complaint to the

ruled (in case C-299/05 on 18 October 2007)

EU Commission cannot replace legal actions

that these benefits count as 'sickness cash

taken at the national level. Therefore, if you

benefits'.

exportable

think that your rights have been infringed, the

according to EU provisions on coordination of

first step is to take action in accordance with

social security (Regulation 1408/71). In other

your national legislation.

words, according to EU rules, people covered

(Ec.europa.eu, 23/11/2009)

considered

They

'sickness

are

cash

therefore

by the British social security system are entitled

6

security

to

benefits

rectify

and

current

justifies

legislation

the

or

NEWSLETTER

23 – 27/11/2009

______________________________________________________________________________________ ECONOMY _______________________________________________________________________________________

Pensions threatened by six-hour daily longevity increase People are gaining on average six hours per day in life expectancy which dramatically highlights the need for pensions solutions, delegates were told at an IPE Awards Seminar keynote speech on living with longevity.

As the ratio of non-workers to workers

per decade; they live healthier at any

increases with growing longevity, the sharp

specific age; they can postpone disability to

improvements

also

later ages; there is a real need for geriatric

threaten workers with an extra heavy tax

medicine and they consequently have to

burden. In Germany, for example, the non-

postpone retirement and work more years of

worker to worker ratio is projected to rise

their lives but fewer hours per year. The

from 1.27 (or five non-workers per four

trend of a linear rise in life expectancy since

workers) in 2005 to 1.47 (or three non-

1840 is mirrored in almost all countries but

workers per two workers) in 2025 if working

most notably in Japan where 65-year old

patterns remain the same. To make up for

women can now expect to live until over 86

this 16% increase in the non-worker burden,

with no sign of any deceleration. Even

workers would be required to pay an

countries where the rise in longevity has

additional 16% in taxes, according to James

stagnated,

Vaupel, director of Germany’s Max-Planck

Netherlands and the US, life expectancy is

Institute for Demographic Research. To

set to rise again in the future, says Vaupel,

avoid such a big loss to the economy, the

as the causes of the temporary halt – mainly

German government is working on a new

the rise in cigarette smoking – have already

work-life

essentially

started to decline. Vaupel gave his keynote

encouraging older workers to work more

speech at IPE’s ‘Future shape of pensions:

and reduce work among younger people to

how to maintain our long-term perspective’

enable them to have more time for further

seminar in Dublin ahead of the European

education

Pension Fund Awards held earlier this week.

in

life

balance

and

their

expectancy

reform,

families.

Vaupel’s

such

as

(IPE.com, 23/11/2009)

prospects for the 21st century are that: populations probably live 2.5 years longer

7

in

Denmark,

the

NEWSLETTER

23 – 27/11/2009

BusinessEurope hopes for greater flexibility from China on exchange rate policy Before the EU-China Summit on 30 November and the meetings beforehand of those with responsibility for economic and monetary affairs in the euro area and their Chinese counterparts, BusinessEurope has expressed its concern over recent developments in euro exchange rates. The European employers' organisation notes that the single currency has risen in value by 13% against the US dollar and the Chinese currency, the Renminbi, since April.

This would seem to be “inconsistent with the

controlled way. That is what Chinese Deputy

objective of an orderly resolution of global

Foreign Affairs Minister Zhang Zhijun said

imbalances,”

BusinessEurope

when he announced, “China will increase

President Jürgen Thumann in a letter to

the flexibility of the Renminbi exchange rate

European Central Bank President Jean-

at a controllable level in the future”. This

Claude Trichet. Trichet will be in Nanjing

flexibility will be “based on the market

with

demand and with reference to a basket of

writes

Eurogroup

Juncker

and

President

Jean-Claude Joaquin

currencies,” he stated, as other Chinese

Almunia on 28 and 29 November for low-key

leaders had promised at the end of 2007

talks on the issue of exchange rates. “The

following a previous visit by the Juncker-

euro cannot take the burden of adjustment

Trichet-Almunia trio, speaking of “gradual,

on its own,” Thumann states, since “this not

dynamic and reasonable” reform in which

only creates a stumbling block for the

the market would have a greater role. “At

recovery of Europe, but could also lead to

some point, the size of the Chinese

sub-optimal

monetary

economy will mean the yuan will have to be

across

different

our

BusinessEurope

Commissioner

is,

policy

decisions

economic then,

blocs”.

backing

floated. But for the moment, the Chinese

the

want

to

keep

control

over

how

it

message that he Europeans will take to the

appreciates. It will take time, even though it

Chinese authorities, urging them to consider

is not inconceivable that a first step may

the appreciation of the Renminbi and

come more quickly,” said Director General

bringing in greater flexibility in their currency

of the International Monetary Fund (IMF)

system, along with increasing Chinese

Dominique Strauss-Kahn in an interview

domestic demand. A slight realignment of

with the French daily Le Figaro published on

China's exchange rate policy is certainly

Wednesday 25 November. “The IMF also

possible, but it will be carried out as and

feels that the euro is probably a bit strong,

when Beijing decides, and in a carefully

but it is very difficult to say for certain what

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NEWSLETTER

23 – 27/11/2009

currency values are,” he went on, stating

China and the US to dominate the global

that

debate over the next 20 years”.

Europeans

should

“affirm

their

(Ed Agence Europe, 26/11/2009)

economic strategy better if they do not want

ECOFIN: Towards a better articulated Lisbon Strategy post-2010 The Commission has opened a consultation process on the Lisbon Strategy post-2010, and the ECOFIN Council will be examining certain aspects of it at its next meeting. In a conclusions document drawn up on the basis of a report from the Economic Policy Committee (EPC), the Council will be examining serious structural challenges to be faced by the EU in the next few years.

High unemployment and low productivity,

highest political level and the defining of a

combined with the knock-on effect of an

small number of key objectives could play

ageing population on state finances and

an essential role in ensuring tangible action.

state aid measures to bail out banks and

Learning from the current situation, the

respond to the economic crisis will be the

Council says that there should be greater

main areas of concern in the debate on the

coordination of policies and surveillance of

post-2010 Lisbon Strategy. The EU will have

the structural reforms introduced under the

to move on from the current situation of

Lisbon Strategy post-2010, and urges the

crisis management to a longer-term strategy

Commission to publish proposals to this end

focussing on growth and jobs, explains the

that make use of all mechanisms available

draft conclusions document. In the future,

under the EU Treaty. Rigorous use of treaty

the new strategy should take greater

measures is one way of strengthening

account of interaction between different

coordination

policies at EU level and Member States'

recommendations, adds the EPC document,

policies.

EU

explaining that follow-up of the current

dimension, particularly in terms of the

Lisbon Strategy has to be improved in order

Common Market, and the foreign trade

to focus to a greater extent on the general

aspects are desirable, as is an alignment of

aims rather than the format. Greater peer

EU priorities and the European Investment

pressures is one of the suggested ways of

Bank's lending priorities with the Lisbon

improving the Lisbon Strategy. In the

Strategy post-2010. The Council says that

conclusions document, the EU ministers will

the new Lisbon Strategy targets should be

encourage the EPC and the Commission to

decided upon and taken on board at the

take into account the of communicating the

A

strengthening

of

the

9

and

respect

of

NEWSLETTER

future

strategy

simple,

economic justification for some targets is

transparent reports on how each Member

debatable, writes the EPC, suggesting that

State is doing in terms of meeting the

they be reorganised in each policy domain

targets and other agreed criteria, including

around a small number of 'big objectives'

how

in

along with 'intermediate objectives' and

comparison with countries outside the EU.

indicators. The EPC suggests that more

The EPC explains that the snowballing of

detailed analysis methodology be drawn up,

targets creates confusion and leads to

going

overall incoherence in the strategy. The

simply in terms of GDP.

connection between targets and the aims of

(Ed Agence Europe, 27/11/2009)

Member

by

23 – 27/11/2009

States

devising

are

doing

beyond

measuring

performance

the policy is not always clear and the

_______________________________________________________________________________________ OTHER NEWS AND EVENTS _______________________________________________________________________________________

Leterme replaces Van Rompuy as Belgian PM Belgium's King Albert is expected to appoint Flemish Christian Democrat Yves Leterme as prime minister for a second time today (25 November), replacing Herman Van Rompuy who was elected European Union president.

The transition comes just six days after

not resolve the disputes between Dutch-

European leaders chose Van Rompuy for the

speaking Flemish parties and their French-

new EU job, a remarkably short period for

speaking counterparts, but gives Leterme a

politically complex Belgium and despite fears

better chance of success at his second

that Leterme's second term in office could be

attempt. Leterme was the clear winner of the

as unstable as his first. After a succession of

2007 federal election, but struggled for nine

talks among party chiefs, the king charged

months to form a government, which then

another former premier, Jean-Luc Dehaene,

lurched for another nine months from one crisis

with proposing ways to resolve conflict in the

to another. He resigned last December over

linguistically divided country. The move does

alleged political meddling in the break-up of

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NEWSLETTER

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Belgo-Dutch financial services group Fortis. He

over areas such as agriculture and foreign

has since been absolved. By contrast, Van

trade. Dehaene is to put forward possible

Rompuy's 11 months in charge have seen no

solutions to the boundary problem, one of the

sign of the internal tensions that had prompted

most divisive issues in Belgian politics and one

media speculation that the country might break

the constitutional court says the country must

apart. During the height of the government

resolve before the next federal election due in

crisis in 2007, central bank governor Guy

2011. The government will hope to resolve

Quaden warned that it risked increasing

these matters before July, when Belgium takes

Belgium's

over

budget

deficit. Economists

say

the

six-month

EU

presidency,

an

Belgium can ill afford renewed government

organisational role held by each member state

paralysis at a time of economic crisis. Indeed,

in turn. On a positive note, Leterme will inherit

the fragile recovery is likely to remain the

a government that has already resolved the

government's main issue. However, Leterme

budget for 2010 and 2011 and a cabinet far

will need to find a consensus on redrawing the

less divided than when he departed last

political boundaries around Brussels and on

December.

further powers that can be devolved to the

(Euractiv.com, 25/11/2009)

regions, which already have a wealth of control

Finland's Rehn set to win top EU economy job Finland's Olli Rehn is expected to take charge of economic and monetary affairs in the European Union, diplomats said yesterday (26 November), giving him a major role in efforts to revive Europe's economy after the credit crunch.

Spaniard Joaquin Almunia will make way for

smoother. "These posts have been offered to

him in that job and is expected to become the

Rehn and Almunia," one EU diplomat said.

27-country bloc's competition commissioner,

Several others also said Rehn and Almunia

also one of the most powerful jobs in the EU

would

executive.

new

President José Manuel Barroso. Almunia, a

Commission as part of efforts to increase its

61-year-old socialist, has won a reputation for

influence on the world stage following the

independence

naming of a president and a new foreign

economic and monetary affairs commissioner.

policy chief and ratification of a treaty

Rehn, 46, has overseen the accession of

intended

Romania and Bulgaria as EU enlargement

The

to

EU

make

is

EU

forming

a

decision-making

11

soon be named by Commission

and

fiscal

prudence

as

NEWSLETTER

commissioner. Commission

"Both

23 – 27/11/2009

men

President

are

two

Barroso's

of

on state aid, prevents protectionism and

top

upholds

the

EU's

single

market.

The

lieutenants and they are seen as safe pairs of

appointment of such a trusted ally as Almunia

hands," another EU diplomat said. "In making

underlines the importance Barroso attaches to

these appointments, Barroso keeps tight

cracking down on any signs of protectionism

control on two top jobs and keeps Paris,

or flouting of EU competition rules. Barroso

Berlin and London's hands off them." Europe's

has made clear he intends to respond to

economy has started to recover after the

criticism that the EU has not upheld its own

global crisis. The EU faces a decision on

strict rules governing its single market since

when to stop emergency financial measures

clearing a series of national rescue schemes

that were used to prop up the economy, and

for banks, carmakers and companies hurt by

needs to tackle soaring budget deficits. The

the credit crisis.

competition commissioner enforces strict rules

(Euractiv.com, 27/11/2009)

_______________________________________________________________________________________ CEIOPS’ NEWS _______________________________________________________________________________________

CEIOPS NEWS ALERT – 25.11.2009

CEIOPS updated the webpage of its 5th annual Conference. The new page offers stakeholders direct access to the key note speeches delivered as well as to a comprehensive overview of the 3 Conference Panels. Direct hyperlink to the updated CEIOPS Conference webpage: http://www.ceiops.eu/index.php?option=com_content&task=view&id=544&Itemid=117

Direct hyperlink to the Speeches webpage: http://www.ceiops.eu/content/view/27/31/#conf09

Direct hyperlink to the Conference overview: http://www.ceiops.eu/media/files/Conference-2009/20091125-CEIOPS-Conference-overview.pdf (CEIOPS, 25/11/2009)

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_______________________________________________________________________________________ EU / COURT OF JUSTICE _______________________________________________________________________________________

Calendar of the Court of Justice

Date

Case

Wednesday 25/11/2009 Hearing 09:30 C-280/08 P

Competition Deutsche Telekom v Commission Court of Justice - Second Chamber

Language of the Courtroom case

DE

Courtroom I - Level 8

Appeal brought against the judgment of the Court of First Instance (Fifth Chamber, Extended Composition) of 10 April 2008 in Case T-271/03 Deutsche Telekom v Commission, by which the Court of First Instance dismissed the application for annulment of Commission Decision 2003/707/EC of 21 May 2003 relating to a proceeding under Article 82 EC (Case COMP/C1/37.451, 37.578, 37.579 – Deutsche Telekom AG) (OJ 2003 L 263, p. 9), and, in the alternative, reduction of the fine imposed on the applicant – Abuse of a dominant position – Charges for access to the fixed-line telecommunications network in Germany – Abusive nature of pricing practices of a dominant undertaking charging its competitors tariffs for wholesale access to the local loop that are higher than the prices it charges for retail access to the local network Thursday 26/11/2009 09:30

Judgment C-363/08

Social security for migrant workers Slanina Court of Justice - Second Chamber

DE

Courtroom I - Level 8

Reference for a preliminary ruling – Verwaltungsgerichtshof (Austria) – Interpretation of Article 73 of Regulation (EEC) No 1408/71 of the Council of 14 June 1971 on the application of social security schemes to employed persons, to self employed persons and to members of their families moving within the Community (OJ 1971 L 149, p. 2) – National legislation providing for the payment of a family allowance (Familienbeihilfe) to persons who have the care of a child and who are permanently resident on national territory – Refusal to grant the allowance, addressed to an Austrian national who has settled with her child in another Member State, the father of the child having remained permanently resident on national territory and being in employment there Advocate General : Poiares Maduro

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_______________________________________________________________________________________ THE ANALYSIS IN DEPTH _______________________________________________________________________________________

Decisions directly affecting financial groups by European supervision authorities The Swedish Presidency is pulling out all the stops to reach political agreement on the micro-economic chapter of the legislative package reforming the European system of financial supervision at the Ecofin Council on Wednesday 3 December. Following the agreement in principle at the end of October on setting up the European Systemic Risk Board, discussion has focused largely on deciding the responsibilities of the three European Supervision Authorities (ESAs) in the banking, insurance and securities sectors, and in particular on their ability to take decisions that override national supervision authorities and apply directly to financial players. The United Kingdom, with support in principle from Central and Eastern European countries, has put its full weight into the battle to weaken the legislative proposals on the table. Some experts feel the British are isolated on texts which require qualified majority in the Council and will be adopted through the co-decision procedure with the European Parliament.

In its initial proposal, the Commission gave

November, of which EUROPE has obtained a

European

copy, has ceded a little to London: the ESAs'

financial

supervision

authorities

powers to take decisions that were binding on

decisions

financial institutions when: - an ESA was

institutions will no longer apply in cases of

exercising

of

emergency on the markets, but will continue to

application of Community law; - disagreement

be applied in the area of monitoring of

over supervision of a cross-border group

application of European legislation and in the

emerged between two national supervision

event

authorities; - a crisis threatened financial

authorities in a cross-border situation. In the

stability. The United Kingdom, backed by

event of a crisis, the relevant ESA will play the

several member states depending on the case

role of coordinator of action undertaken by

in point (Bulgaria, Finland, Greece, the Czech

national authorities. “We should come to a

Republic, Romania, Slovakia and Slovenia) is

compromise,” hoped one diplomat. He said

against

that a solution could be to grant the ESAs

its

such

power

powers

of

monitoring

being

granted

at

of

relating

directly

disagreement

compromise,

institutions only on monitoring application of

Thursday

19

14

over

national

directly

from

powers

between

financial

European level. A Swedish Presidency draft dating

binding

to

financial

NEWSLETTER

23 – 27/11/2009

Community law. This is already something if it

emergencies have been retained. Several

is considered that, at the heart of the reform,

debates have considered the granting of

there is the adoption of technical standards

responsibilities to the ESAs on supervision of

promoting the setting up of a single body of

pan-European entities. A large majority of

rules

and

member states is opposed to the ESAs having

monitoring of compliance with Community law,

control over banks and insurance companies.

he added. Safeguard clause. A safeguard

The situation is different on the securities

clause, called for by the United Kingdom,

market. Member states agree on granting the

ensures that ESA decisions, when related to

ESA the power to supervise rating agencies

disagreements between national supervisors

regulated at European level. Only the United

or emergencies, do not ride roughshod over

Kingdom is against the securities market ESA

member states' fiscal responsibilities. An ESA

ultimately

will not be able to force a member state to bail

houses

out a failing financial institution from the public

harmonised at European level. A further

purse.

a

stumbling

concerned,

conditions

(“the

single

The

procedure

EU

rule

Commission

book”)

envisages

(entity/institution

supervising once

their

block

derivatives activities

have

relates to the

required

when

clearing

a

been

technical European

timescale to be met) ensuring that an ESA

supervision authority makes a decision on a

decision

national

disagreement between national supervision

budgetary powers. Spain, the United Kingdom,

authorities. On a case-by-case basis, a panel

Poland and Slovenia want to strengthen this

of three members of the ESA Board (the

clause so that member states retain greater

Chairman of the ESA + representatives of two

room for manoeuvre. The Swedish Presidency

national authorities not involved) will be

compromise proposal sets out the suggested

responsible for considering the dispute and

procedure requiring a legal decision from the

preparing a decision. According to the Swedish

Council to revoke an ESA decision challenged

Presidency, the ESA Board will endorse the

by a member state. However, provisions

panel's proposal unless three quarters of its

contained in the initial proposal relative to

members reject it.

decision-making in

(Ed Agence Europe, 25/11/2009)

does

not

impinge

the

on

Council

(qualified

majority) and shortening the timescale in

15

NEWSLETTER

23 – 27/11/2009

New raft of infringement proceedings On Friday 20 November 2009, the European Commission decided to pursue infringement proceedings against several member states in relation to public tender, financial services and the supply services.

Public tender. A) Germany is being taken to

allocating contracts without advertising them or

the European Court of Justice over its granting

opening up to competition was valid only if the

of two contracts (without a call for tender) by

public authority has control over the sub-

the city of Rostock to a mixed company for

contractor similar to its control over its own

waste disposal. The German authorities admit

services ("in-house" relationship). F) The

that EU rules were infringed but the contracts

Commission is closing proceedings against

are continuing. B) Spanish legislation gives

Slovakia concerning the granting of a service

public authorities the option of amending

contract by its infrastructure minister without

fundamental terms of public contracts after the

observing European legislation. According to

contracts have been awarded. This option is

the Commission, Bratislava's cancellation of

not made clear and the Commission believes

the contract removes the specific foundation

the system infringes the EU Treaty. C) The

for the complaint, but does not close the

European Commission has sent a reasoned

investigation currently being carried out by the

opinion letter to Greece asking for official

European

information about the award by the Greek

investigations of the Slovakian police and

government

justice authorities.

of

contracts for

real

estate

Anti-Fraud

Office,

or

the

mapping and town and country planning

Financial services. A) Belgium will have to

services. These contracts supplement the

explain itself before the Court regarding its

initial

after

national legislation governing complementary

negotiations without any publication of a call to

health insurance offered by private health

tender. D) Greece is also being sent a warning

insurance funds (mutualités/ziekenfondsen).

letter asking it to explain how it has complied

The Commission is keen to make sure that

with a European Court of Justice ruling (Case

when they offer health insurance over and

C-489/06) on the supply of medical devices to

above the obligatory social services regime,

Greek hospitals. E) The Commission has

these organisations are subject to the same

decided to end an infringement proceeding

prudential

against France over the award of contracts to

73/239/EEC

several semi-public French establishments

governing private insurance companies. B)

without a call for tender. In their national

The Commission has decided to bring four

legislation, the French authorities state that

member states (Belgium, Ireland, Greece and

contracts

and

were

granted

16

controls and

and

rules

92/49/EEC)

(Directives as

those

NEWSLETTER

23 – 27/11/2009

Luxembourg) before the Court of Justice for

has expressed his or her intention of buying

failing to transpose an accounting directive in

the land. The measures taken by Vienna do

full

not respond to all of the concerns voiced by

(deadline:

5

March

2008).

Directive

2006/46/EC stipulates, amongst other things,

the Commission.

the upper limits allowing a member state to

Money laundering. Belgium will be asked for

determine which companies are exempt from

clarification on how it has complied with the

certain obligations of information. The United

ruling of the Court which stipulates that this

Kingdom will receive a reasoned opinion for

member state is not applying the definition of

failing to transpose the directive in Gibraltar. C)

"politically exposed persons" brought in by

Seven member states (Spain, Greece, Italy,

2005/60/EC with regard to money laundering.

Netherlands, Poland, Portugal and the United

The deadline and transposition directive was

Kingdom) will receive a reasoned opinion for

set for the month of December 2007.

failing fully to transpose Directive 2007/44/EC

Professional qualifications. A) Greece will

(deadline: March 2009). This active legislation

receive a reasoned opinion asking it for

reinforces procedures and defines the criteria

information on how it has complied with a

to be applied by the national monitoring

ruling

authorities when assessing acquisitions or

condemning its refusal to acknowledge a

increases in stakes in financial companies. The

number of engineering degrees issued in other

United Kingdom will receive a reasoned

member states. Athens has also infringed

opinion for failing to transpose the directive in

other

Gibraltar.

governing

Free

movement

of

professional

(case

directive

C-274/05)

89/48/EEC

qualifications.

B)

Commission will ask Italy how it has come into

465/08), the Commission will ask Greece to

line with a ruling of the Court (case C-326/07)

notify it of its measures to transpose Directive

of March 2009, which takes the view that the

2005/36/EC stipulating the European rules on

criteria allowing the Italian state to oppose

the recognition of professional qualifications.

acquisitions of stake in privatised companies

This directive should have been transposed by

active in the energy or telecommunications

the end of October 2007.

sector are too generous and unspecific.

Provision of services. A) When receiving

According to the Court, this decree gives the

health care in another member state, a patient

Italian

discretionary

affiliated to a German sickness insurance

powers. B) Austria will receive a reasoned

provider is not entitled to the same rate of

opinion asking it to make changes to legislation

reimbursement as for exactly the same care

of the Land of Vorarlberg, which makes it

provided in Germany. Berlin will receive a

impossible

in

reasoned opinion for hindering the freedom to

agriculture to buy agricultural land if a farmer

provide services. B) UK legislation still does

excessive

people

not

A)

provisions

Court

Further to a ruling of the Court (case C-

for

capital.

the

The

authorities

of

of

involved

17

NEWSLETTER

not

allow

the

recognition

23 – 27/11/2009

of

medical

higher education establishments from issuing

prescriptions drawn up in another member

foreign diplomas. D) Portugal will receive a

state for the provision of certain drugs

reasoned opinion as its national legislation on

("controlled drugs" category). The Commission

construction

will send the United Kingdom a reasoned

authorisations

opinion. It is also contesting the obligation to

member states to be taken into account,

specify the address and age of the patient on

includes

prescriptions before these can be recognised.

minimum activity in Portugal and bans all forms

C) By means of a reasoned opinion, the

of sub-contracting.

Commission called on Cyprus to modify its

(Ed Agence Europe, 24/11/2009)

national legislation banning private Cypriot

18

a

services already

does obtained

requirement

for

not in

allow other

maintaining