iNSiGht - Intro

insight corporate Governance Germany
Transaction tax still controversial
French President Nicolas Sarkozy announced at the end of January he would introduce
a transaction tax. Originally he wanted to bring in the transaction tax together
with Chancellor Angela Merkel by 2014, if necessary only in the 17 countries of the
Eurozone. Merkel, however, has problems with the commitment, as her coalition
partner the FDP will accept the tax only for all 27 EU countries. Another alternative
would be to introduce the tax in accordance with the country-of-domicile
principle, with the tax depending not on the place of trade but the tax residence of
the actor. Meanwhile, Allianz CEO Michael Diekmann threatened that Germany’s
largest insurer would escape to London if the transaction tax in the eurozone came
in. Federal Finance Minister Wolfgang Schäuble (CDU), however, indicated he was
still working hard on the introduction of the tax in the EU countries. The tax is on
the agenda for the EU summit in late Jauary.
Roland Berger to the fore on
European credit rating agency
Following the downgrade of France and the bad ratings for other European
countries, the European Commission favours a European rating
agency. To the fore here is an initiative of consulting firm Roland Berger.
The core idea is a marketplace, a large platform, on which issuers disclose
their information. From the available facts, the new rating agency is to
derive their grades. Its judgments are then accessible to investors. Not the
issuers, as is usual for the big three in the industry, should pay but the investors.
Roland Berger partner Markus Krall wants by mid 2012 to collect
around 300 million euros for building the agency from banks and other
investors. It is now necessary to transform the expressions of interest into
legally binding commitments, says Krall. The privately funded, non-profit
foundation will have its headquarters in Holland and receive no State
funds. The operating subsidiary may be located in Frankfurt and have a
strong presence in Paris. If everything goes smoothly, the first sovereign
ratings could be created by the end of the year and the first bank appraisals
launched in early 2013. After three to five years the Agency should be
self-supporting, and investors getting their stake back with interest. Other
initiatives for a European rating agency have been taken by, among others,
the German Environmental Foundation with its ENRA (European sustainable
rating agency) project, the Bertelsmann Foundation and the Eacra
platform, a consortium of European small agencies.
POLitiCs
Banks and insurance
companies should rate
themselves
To date, insurance companies must, for
funds which are invested for retirement,
base themselves on the ratings
of the three major agencies, and sell
government bonds which do not have
the top AAA rating. Following the recent
downgrading of more euro countries
by S&P in mid January, the CDU/
CSU parliamentary group called for the
rules for large institutional investors
to be changed. Banks and insurance
companies should accordingly assess
the creditworthiness of countries
themselves. Chancellor Angela Merkel
(CDU) rallied behind this initiative.
Now, the proposal will be submitted to
EU finance ministers for consideration.
issue 02/2012
09