Quarterly Bulletin Q3 2013

Developments in EU Financial Services
Legislation during the Irish Presidency of the
Council of Ministers January - June 2013
Quarterly Bulletin 03 / July 13
79
pay-out and more credible funding of
schemes. Progress on this dossier has had to
await the decisions on the financing issues
reached in the BRRD.
The BRRD agreement also clears the way for
the Commission to present its proposals on
SRM (Single Resolution Mechanism)
(expected in July). This will establish a Single
Resolution Board and a Single Bank Resolution
Fund for institutions subject to the Single
Supervisory Mechanism. The Lithuanian
Presidency will give priority to this dossier.
including derivatives markets and to introduce
an OTF (Organised Trading Facility) regime and
a harmonised third country regime. However
the complexity and sensitivity of the proposal
led to strong divisions between member states
and agreement had eluded successive
Presidencies.
After nine Council Working Party meetings, the
development of successive compromise texts
and intensive bilateral discussions hosted by
the Presidency, a Council General Approach
was agreed in June.
In summary the Irish Presidency concluded
Trilogue discussions on two of the five
elements of Banking Union and achieved a
Council General Approach on a third.
It should also be noted that during the
Presidency the economic and fiscal context
within which Banking Union will operate was
strengthened by the Trilogue agreement on the
‘Two Pack’ on budgetary and economic
surveillance and coordination.
Markets Reform
Outside of the Banking sector there was a
wide ranging series of proposals from the
Commission aimed at improving the stability
and efficiency of the Single Market in financial
services and the Presidency faced a significant
build-up of dossiers. From the outset the
Presidency focused on two files in particular -
MiFID/R and MAR.
MiFID had been in effect since 2007 and had
increased competition, reduced costs and
provided greater choice for investors. The
Commission introduced proposals in October
2011 MiFID/R (Markets in Financial
Instruments Directive and Regulation) to
update the legislation in line with G20
commitments and to take account of new
trading venues, products and technology (such
as high frequency trading). It also aimed to
improve oversight of less regulated markets,
MAR/D (Market Abuse Regulation and
Directive) strengthens the existing regime on
market abuse and insider trading with a
Regulation covering the administrative regime
and supplemented by a Directive on criminal
sanctions. The regime is extended to cover new
trading platforms and OTC (Over the Counter)
trading and introduces tougher sanctions.
Concern about the manipulation of
benchmarks (such as LIBOR) increased the
pressure for progress on the file and Trilogue
agreement on the Market Abuse Regulation
was reached in June. It was agreed with the
Parliament to temporarily suspend discussions
on the Market Abuse Directive until progress
was made on the Regulation. Negotiations on
the Directive will resume under the Lithuanian
Presidency.
During the second half of the Presidency
priority was also given to Trilogue negotiations
on the Transparency Directive where the
Commission proposal dated from October
2011.This Directive sets minimum
requirements for the disclosure of periodic and
on-going information by issuers of securities
and on the disclosure of major shareholdings
and voting rights. Agreement was reached in
June. It was possible to reopen negotiations on
this Directive because of Presidency success
in the related Company Law (Accounting)
Directive where Trilogue agreement was
reached between the Parliament and the
Competitiveness Council.