EPP-ED Report
Issue 9 / September II 2008

EP votes for EU-wide minimum standards in financial sector

By Per Heister

The European Parliament this week voted in favour of EU-wide minimum standards in the financial sector that covers all financial market actors and instruments. Openness, transparency and liability are the keywords. The current financial crisis doesn't surprise the European Parliament, where preparations for stricter rules have been in the making since last year.

Despite the long preparation, German MEP Klaus-Heiner Lehne found that the financial turmoil of recent weeks has added arguments in favour of the proposed Regulation: We are all appalled by the events of the past few weeks; the public, politicians and the economic sector. It is a serious problem that in the inevitable practical solutions of the moment, profits have been privatised while losses have been socialised. "Money knows few borders and Regulations have to follow suit," argued Lehne.

It is true that the companies in the financial sector are ruled by national legislation, sometimes strong and sometimes not so strong, in accordance with national traditions. But it has become obvious that we also need harmonisation and closer co-operation on a European level to make sure that these companies, that together create a critical financial mass, will not put the markets at risk.

Kurt Joachim Lauk (D) was equally concerned in his contribution to the debate on behalf of the EPP-ED Group. The ongoing crisis of the banking sector shows that we can no longer rely on US standards, particularly since the American control systems partly failed. As a consequence, the European Union must create its own protection and control mechanisms.

Lauk lists proposals such as risk evaluation, risk-based capital requirements, more transparency of financial instruments and an appropriate participation of responsible managers, not only in profits, but also in losses.

The openness and transparency required by the Parliament will thus make salaries and remunerations for management available to the public.

So far, rating institutions such as Standard & Poor and Moody's have been unregulated but Kurt Joachim Lauk is now asking for them to be included in future Regulations: "We ought to hold the rating agencies liable for their evaluations following the example of the existing rules for auditors."

The European Commissioner responsible for the Internal Market agreed: "As I said earlier, the market turmoil exposed failings in the risk management of large financial institutions. It also highlighted a number of areas of regulatory weakness. It is on these areas that regulatory attention must now be focused."

EU needs to step up its actions in combating terrorism

By Eva Mitsopoulou

"Terrorism threatens the fundamental freedoms and principles on which the EU is founded", said Panayiotis Demetriou (GR), Spokesman on the report on combating terrorism, after the report was voted by the plenary of the European Parliament on Tuesday.

"In recent years, the threat of terrorism has grown and therefore the need to hamper the recruitment and training of terrorists, as well as curtailing public incitement to commit terrorist offences, is higher than ever before", Demetriou continued.

Mr Demetriou expressed his satisfaction with the final text saying that it is important to have a consensus on the issue because Europe should speak with one voice to combat this increasing threat. He underlined that the package of measures presented by the Commission constitutes a key tool in the fight against terrorism by intending to harmonise national provisions on public incitement to commit a terrorist offence, recruitment for terrorism and training for terrorism. As regards the development of information and communication technologies, these three new forms of criminal offences will therefore also be punishable when committed through the internet (cyber terrorism) in the EU. Furthermore, the system of penalties, liability of legal persons, jurisdiction and prosecution applicable to terrorist offences will also apply to such criminal offences in order to respond more effectively to modern terrorism.

"The EU needs to prevent new forms of terrorism and this report on combating terrorism guarantees a real balance between the protection of fundamental freedom, particularly the freedom of expression, and a greater effectiveness in the fight against terrorism", Panayiotis Demetriou concluded.

Consumers' rights boosted by new EU telecom sector rules

By Pedro López de Pablo

The European Parliament this week adopted new legislative proposals by a large majority to regulate the telecom sector to take into account technological developments since the 2002 Regulation came into force and to enhance the rights of consumers.

The legislation includes draft proposals for a Framework Directive to regulate electronic communications networks and services, the creation of a Body of European Regulators in Telecommunications (BERT) and a new Users' Rights Directive which covers all forms of electronic communications including telephones, both fixed line and mobile, fax, internet, cable, and satellite.

"This is a really important piece of legislation to boost a sector with high growth expectations and for 500 million consumers", said Pilar del Castillo MEP after the vote, calling on the EU Council to reach an agreement on the new rules before the end of this parliamentary term in June 2009. "It is very important to respect this deadline if we want to safeguard the European sector as a leader in the world market, as we should have a clear framework to attract investors for the development of new services and new networks", she added.

The will of the Parliament has been to set out a "co-regulation" system in which national authorities have to consult the Commission and BERT before taking regulatory measures and are empowered to demand changes if the measure is considered inappropriate. BERT will be the basic pillar to ensure fair market competition and high quality telecom services across Europe and it will be funded jointly by the EU and national regulatory authorities.

One of the most important parts of the legislative package deals with consumers' rights. Malcolm Harbour MEP, who was responsible for this report, thinks the new rules will provide users with much clearer mobile phone contracts, price plans and more information about restrictions to particular services on their handset, such as Skype, before agreeing to a contract. Communications contracts will be a maximum of 24 months to avoid consumers being locked into long contracts, a measure that should encourage operators to improve their services and keep prices down.

Furthermore, the new rules will mean that consumers will be able to keep their phone number when switching to another network operator in just one working day, avoiding a process that takes up to 30 days in some EU countries. Disabled users will also benefit from the new rules, which will ensure they receive equivalent access to communications as able-bodied people.

"We have significantly enhanced the initial proposal and we hope that national governments will now back our line, as this package will empower consumers to shop around as providers are encouraged to offer better deals and ultimately, this will improve the service they receive on the internet and on their telephones", Harbour said.

New safety measures for sea transport

By Thomas Bickl

EPP-ED MEPs have called on EU Transport Ministers to speed up negotiations and reach an agreement with the European Parliament on the measures for maritime safety as soon as possible.

EPP-ED Transport Spokesman Georg Jarzembowski (D) explained the lack of commitment on the part of the Council: "It is plain to see that Member States are afraid to accept binding obligations and the implementation of standards. This is all the more astonishing, as they repeatedly say they are in favour of safety at sea, safety for seamen and passengers and the protection of the environment."

Dominique Vlasto (F) highlighted why it is time to deliver before a new catastrophe occurs: "We cannot wait for another major accident to happen at sea before we are sure that maritime safety is a major priority for us. It is also indispensable for the people who are fed up seeing their coasts polluted. These accidents are a catastrophe for the environment and also end up in financial disaster."

The Third Maritime Package includes eight legislative measures to enhance maritime and vessel safety. The new standards include provisions on emergency ports for vessels in distress, joint independent investigations after an accident and the inspection of vessels in and around ports. For example, ships which have repeatedly failed safety standard inspections are to be excluded from any port access altogether.

Patients should be main focus of Social Package

By James Holtum

John Bowis (UK) led the debate for the EPP-ED Group on the second half of the Social Package - the health aspects. Mr Bowis, who has recently been appointed the Parliament's Rapporteur on the Cross-border Healthcare Directive, pointed out that jurisprudence of the European Court of Justice already allows a patient to seek treatment in another Member State if they face 'undue delay'. But Mr Bowis warned that allowing lawyers rather than politicians to set a framework was creating a lack of legal certainty surrounding patient mobility in the EU, and patients, government and health practitioners must be made aware of their rights and responsibilities.

Mr Bowis said there will be a number of questions that the Parliament must find answers to when it debates the Directive. For example, how a patient can determine if they qualify for treatment abroad, what happens if there are complications, whether a patient must get prior authorisation from their local health provider. The Parliament must also tackle the issue of reimbursement - will the patient have to stump up the cash before the treatment, or can the EU facilitate a central clearing house arrangement?

Mr Bowis said: "It is patients who are at the centre of this - patients, not lawyers - and it is for all patients, not just for a few."

Concentration and pluralism in the media in the European Union

By Krizsta Kovacs

The EPP-ED Group is fully committed to media pluralism and freedom of the press and strongly believes that the media plays a predominant role in preserving democracy, which was the goal of the Mikko Report, although, the Group rejected the Estonian Socialist Rapporteur's Resolution for other reasons. Pál Schmitt (HU), EPP-ED Group Spokesman on this subject, said that the Group tried to reach an agreement, but it was rejected by the Rapporteur. Without this consensus, there was no room to influence the content of the report.

"The new rules just introduced in the current plenary session of the European Parliament do not allow amendments to be tabled to the report, and they don't even allow our group to express an opinion in an open debate", said Pál Schmitt. "The only way to express our opinion was by rejecting the report and proposing an alternative. The reason for that is that there were some unacceptable paragraphs in the report which are against our political priorities which needed to be left out."

Pál Schmitt underlined that the most important disagreement between the Rapporteur and the EPP-ED Group was pointing out one Member State where freedom of expression and information is supposed to have been violated. The group believes that an EP Resolution should not single out any Member State and should respect how each Member State organises its own media market.

The EPP-ED Group believes that Member States should be able to decide how to ensure media pluralism and it should therefore be up to them whether they want to create an independent media ombudsman or not, which was suggested as a mandatory institution in the original report. The EPP-ED Group rejected the report which asked the Commission to draw up a Directive to ensure media diversity, whereas the group believes a Recommendation to the Member States would suffice at this stage.

In view of the importance of the topic, the group would like to suggest that the Commission engages in this subject and drives an exhaustive discussion on the need for EU action to ensure media pluralism in Member States.