Brussels, 26/03/2014 (Agence Europe) - EU member states and the European Parliament (EP) disagree over when the bank resolution fund (SRF) should be set up.
EU member states' representatives to the EU on the Coreper committee are supposed on Thursday 27 March to approve an agreement reached by representatives of the Council of Ministers and the EP on the bank resolution mechanism (SRM) in the eurozone, but a new obstacle has arisen since the marathon talks last week (see EUROPE 11043). MEPs refuse to allow entry into force of the SRM regulation to depend on entry into force of the intergovernmental agreement on which the SRF will partially be based.
The future regulation says that the SRM shall come into force on 1 January 2015, and the SRF shall come on stream on 1 January 2016. The future intergovernmental agreement to be ratified by eurozone nations will come into force when member states representing 90% of weighted votes on the SRM have lodged their ratification instruments.
The Greek Presidency explains that governments cannot commit to an exact date because some national parliaments have to endorse the agreement and committing to a date would prejudge the result of the parliamentary vote. For this reason, it says, the entry into force of an intergovernmental agreement tends to depend on the number of countries that have ratified it, admitting that the European legislator will need to do some creative legal legwork to find a way round the problem.
The EP takes a very different view, seeing it as far more than a legal issue to be resolved. Sven Giegold (Greens/EFA, Germany), one of the EP's co-rapporteurs, says that the Council wants European legislation to come into force when the intergovernmental treaty had been ratified, which is not possible of course. He said that it should be member states that apply European law, and not the other way around. He said this was a highly political issue because it is about the supremacy of European law over national law.
MEPs say that the Council must bear the consequences of their desire to withdraw from the Community method for eight years for collecting cash from banks for the SRF into national compartments that will then be gradually pooled. If eurozone nations manage to ratify the intergovernmental treaty by 1 January 2016, then the current concerns are simply a storm in a teacup. But if they do not, then there will be an SRM without an SRF, warned Giegold.
After the EP rejected an initial proposal from the Council, national experts discussed the question on Wednesday 26 March. If no solution is found for Thursday it is likely that Coreper will not approve the draft regulation (the idea was for it to be given the go-ahead in time for the EP to vote on it at the last plenary in April). Member states' ambassadors will be holding further talks on the matter. (MB)