Local view for "http://purl.org/linkedpolitics/eu/plenary/2002-03-13-Speech-3-335"
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"en.20020313.12.3-335"2
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". – Madam President, this is a joint debate on three subjects. I should like to start with the report prepared by Mr Lipietz. I begin by commending him on that excellent report. He has mastered a proposal which is both technically complex and economically important.
I know we all agree that the European Union has no truck with greedy financial cheats. We want stable, transparent, integrated and efficient European markets for all consumers and investors. This directive must contribute to increasing investor protection and to making European financial markets surer and more attractive in future. It must dispel the international concerns expressed over the last few years about insider dealing and manipulation on European markets.
I am certain all Members are aware that recent events have shown how important those issues are. It is not only the attacks of 11 September that have proven the necessity of high market protection. Scandals such as the Enron business, which has been referred to at various times tonight, clearly show the need for rules making markets safer and ensuring that they remain free of abuse and fraud. The smooth functioning of financial markets and public confidence in them are the conditions for sustained economic growth and wealth. Market abuse increases the costs for financing companies, harms market integrity and dissuades investors. We must do everything to stamp it out. With this directive, we ensure high market integrity, and establish common standards against market abuse throughout Europe, making European financial markets more attractive in future.
The Commission can agree with all the amendments that Mr Goebbels has proposed in his report, except those additionally proposed by Mrs Echerer, Amendments Nos 75 and 76, by Mr Lehne, Amendments Nos 88 and 89, and by Mr Herzog, Amendment No 87.
But the Commission still has doubts about Amendment No 2 regarding comitology. Firstly, this amendment is not necessary, given that the Commission has already accepted Amendment No 1, which makes a clear reference to the declaration of President Prodi at the last part-session of this Parliament on 5 February and to my letter of 2 October 2001 to the chairperson of the Committee on Economic Affairs, Mrs Randzio-Plath. Furthermore, during the debate on the report by Lord Inglewood concerning international accounting standards last Monday, I once again underlined our full commitment to this important declaration regarding the implementation of financial services legislation.
Secondly, the amendment does not reflect all the elements that have been agreed between our institutions, and there are some differences between the wording of the declaration of President Prodi and the wording of Amendment No 2 which might result in misinterpretations. Furthermore – and this is an important point – I would say to Mr Goebbels that I am not certain whether the different wordings would be agreed by the Council. I cannot speak on behalf of the Council, but it may well entail difficulties which we would be well advised to avoid. The Commission would prefer, therefore, to stick to what has previously been agreed.
Let me state unequivocally that the Commission will fully respect – and to the letter – the commitments it has made in its declaration in plenary, as well as in my own letter to Mrs Randzio-Plath. Should plenary adopt the amendments adopted by the Committee on Economic and Monetary Affairs, together with some of the additional amendments proposed for today's sitting, I very much hope that the Council will be able to accept this text as well, so we would have only one reading. That would be a major achievement for the integration of European financial markets by the year 2005 to which we all aspire, as well as a sign of confidence for the Barcelona European Council. I hope that all Members present here and those voting tomorrow will agree and adopt that directive.
Lastly, we come to the report prepared by Mr Huhne concerning the directive on prospectuses. May I again begin by thanking Mr Huhne for his report. Many amendments have been proposed and they result in clarification of our proposal. Good work has been done to improve the wording on eurobonds, which we broadly support. We can accept 46 amendments: Amendments Nos 1, 3, 4, 7 to 9, 13, 18, 19, 22 to 26, 29, 30, 38, 39, 41, 43, 44 to 56, 58 to 61, 63, 64, 66 to 72 and 75, but we may have to redraft some of them to ensure the overall coherence of the text.
I am worried, however, by some points which Parliament may adopt. Firstly, I am concerned that, in the aftermath of Enron, Parliament may even weaken the fundamentals of current EU legislation, i.e. legislation which is now in force, namely, that companies wanting to raise capital among the public have to disclose information in a prospectus approved by the competent authority. That is what Amendment No 35 is about. Is this Parliament really prepared to support an amendment to the effect that more than 75% of all companies listed in Europe should be able to raise capital without publishing a prospectus? Mrs Berès made that same point a little while ago. That would mean that for some EU markets all but one or two companies would be exempted. How do we explain that to European investors?
For the Commission, the prospectus proposal has two aims: to facilitate fundraising for European issuers, and to ensure an adequate level of investor protection. Both these aims are equally important. Investor protection has been neglected too often in the discussion.
The second cause for worry is that some of the amendments proposed will result in more fragmentation, not less. We must agree what is good for the EU as a whole, and we do not want any tinkering with national systems. Let me be clear on this point, and let me be clear to this House, that my colleagues and I will spare no effort to reach an agreement with Parliament on this crucial text for a single capital market, but we must resolve those problems.
I can therefore accept the following amendments without reservation: Amendments Nos 2, 3, 7 to 10; Amendment No 9 as corrected by Amendment No 50; Nos 18 to 30, 35, 36, 40 and 42. These are welcome reinforcements and real clarifications of the proposal.
Let me now briefly address possible solutions to some of the most important political issues. On small and medium-sized enterprises the Commission is against their total exemption from the proposal, but it is willing to find a cost-effective solution that would ensure that SMEs should have access to capital markets at the right price and under the right levels of regulation with the necessary investor protection. We have always advocated adapting the disclosure rules to the specific nature of SMEs and we would be ready to contemplate an exemption for SMEs from the obligation annually to update the prospectus, as proposed by Amendment No 71.
As regards eurobonds we agree with the rapporteur's idea to exempt eurobonds with a high minimum denomination but we consider that the level proposed – EUR 50,000 – is too low. We therefore support Amendments Nos 66 and 67, as it seems to the Commission that good work has been done here.
As regards the annual updating of the prospectus, we might contemplate exempting SMEs but we shall certainly stay firm as regards big companies, not least because 300 of our largest companies listed in the United States already comply with this obligation. Our investors should have the same disclosure as United States investors. I am certain we all agree that our investors are not inferior to the American ones.
Lastly, regarding the competent authority, we want to retain our position of one administrative authority per Member State. We are ready to clarify that a delegation of powers is possible provided that the ultimate responsibility remains with the single administrative competent authority. We do not agree with the free choice of the regulator which might lead to the famous "race to the bottom", but we would be ready to consider some flexibility for issuers of debt securities and those working out of third countries.
To sum up, the Commission rejects 29 amendments. They are Amendments Nos 2, 5, 6, 10 to 12, 14 to 17, 20, 21, 27, 28, 31 to 37, 40, 42, 57, 62, 65, 73, 74 and 76. Regarding Amendment No 10, we accept the amendments on comitology because they reflect our agreement on that matter, but we consider that Amendment No 10 is redundant. The situation is the same as for Amendment No 2, on the report by Mr Goebbels, so I do not have to repeat the whole argument. We consider Amendment No 10 to be redundant given Amendment No 1, which refers to the resolution of Parliament and my letter to Mrs Randzio-Plath.
In the same way there are a number of amendments which I can accept in spirit. They go a long way in the right direction but need some refinement to avoid confusion or possible contradiction. Amendment No 6 could be improved by combining the elements in Amendment No 9 to give a good set of macro-economic criteria to determine which groups are covered by the directive. Amendment No 17 clarifies how to cover special group structures. That is also a welcome clarification but the wording could be tightened up. Amendment No 31 requires the Commission to consult industry. I agree. But the amendment seems to us to be too limited. It restricts consultation to a handful of Brussels federations. The Commission is in favour of as wide and as representative a consultation as possible. I think that Parliament would also consider that necessary.
Amendments Nos 32 to 34, 44, 46 and 48 seek to amend what should be deducted from capital to prevent the so-called double-gearing of capital and artificially inflate a company's capital base. I agree with the spirit of those amendments. The 20% threshold for insurance deductions appears to be a good compromise. The proposed wording just needs some improvement to ensure the overall coherence of the text. But Amendments Nos 43, 45 and 47, which completely contradict Amendments Nos 44, 46 and 48, are then not acceptable.
There are only a few amendments which I am unfortunately unable to accept. Firstly, amendments that significantly narrow the scope of the directive: namely Amendments Nos 4, 5, 11, 12 and 49. They will limit the measures to groups with a parent/subsidiary relationship only. That does not reflect reality. There are groups that are organised on a different basis which would then escape supervision, for example, horizontal cooperatives or mutual groups such as Rabo Bank in the Netherlands or the DG Bank in Germany. These amendments also exclude anyone with close links to a conglomerate. After the Spanish BANESTO case we all know how important it is to include such cases in our supervision, in particular for intra-group transactions.
A second group of amendments which I unfortunately cannot support concern the calculation of capital adequacy. They are Amendments Nos 15, 16, 37 and 39. I can accept moving the substance from the annex to the articles of the directive but I cannot support the additional substantive changes on the definition of capital. They would fundamentally undermine the capital standards for our industry. Firstly, the English text of Amendment No 16 changes one word in the original proposal and consequently opens the door to acceptance of all types of capital to cover risks, irrespective of the quality of that capital. I understand that this is a typing error – these things sometimes happen – but I should like confirmation that the French and German texts, which leave the original text unchanged, are the correct text. Secondly, I cannot accept including minority interests in group capital – that is, the last sentence of Amendment No 15 – if all the risks in the group are not also covered.
The third group of amendments which I cannot support are those that give our financial groups the freedom to choose the way in which they calculate their capital adequacy. This concerns Amendments Nos 1, 13, 14, 38 and 51. That is the role and responsibility of our public authorities. They cannot abdicate this to the industry through self-regulation, and I agree that the authorities should discuss and agree with each group how its capital adequacy should be calculated. I am sure that we can work out an acceptable compromise, but I ask for your understanding if I say that these amendments go too far.
In conclusion on this point, this is a most welcome and supportive report. I should like to underline that. With a few exceptions which I have mentioned, it really contributes to a rapid agreement and I am confident that it will be possible to work out acceptable compromises on the following amendments: Nos 1, 4, 5, 11 to 16, 37 to 39, 49 and 51. Progress is being made in the Council and agreement between the institutions appears quite close.
On the second issue, which is the report prepared by Mr Goebbels, may I begin by saying that very good progress has been made on this dossier. First of all I should like to thank the rapporteur, Mr Goebbels, very much indeed for all the efforts he has made while working under heavy pressure, as we all do, incidentally. It is a very complex and sensitive dossier and I should like to applaud the fact that the rapporteur has resolutely defended the aim of this directive, namely to enhance substantially the integrity of European financial markets. I should also like to thank the shadow rapporteur and the members of the Committee on Monetary Affairs for their readiness to proceed as quickly as possible."@en1
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