On Wednesday 27 June, the ambassadors of the member states to the EU (Coreper) approved the Council's negotiating position on the proposal, presented at the end of March, to align the cost of cross-border payments in euro throughout the EU (see EUROPE 11991).
Readers may recall that the aim is simple: to allow citizens and businesses located in non-Eurozone countries to enjoy the same conditions as those applicable to Eurozone residents when making cross-border payments in euro.
The Council has approved the principle of aligning the costs charged for cross-border payments in euro for services such as bank transfers, card payments and cash withdrawals on the costs charged for the “corresponding national payments of the same value made in the national currency of the member state where the payment service provider of the payment service user is located”.
Another aim of the proposal was to reinforce the transparency of payments requiring a currency conversion by setting out a series of requirements in terms of the information to be disclosed to consumers, which will be laid down by the technical regulatory standards of the European Banking Authority (EBA).
The Council hoped to go further by reinforcing transparency when a currency conversion is offered by a service provider other than the payment service provider of the consumer prior to the transaction.
The text brings in an obligation, in such cases, to publish the presented applied costs as the difference between the total of the transaction in the currency of the payer's account and the amount resulting from the application of the most recent available reference exchange rate of the European Central Bank. It further stipulates that the information must be clear, comprehensible, not misleading and allow consumers to select the most beneficial option.
Another requirement has been added: for the EBA to report to the Commission on the implementation of these rules for the first two years of application. In particular, the report must cover the evolution of costs for both national and cross-border payments, problems encountered by service providers in practice and the channels of communication used.
Then, on the basis of this report, the Commission will be required to assess the impact of the regulation and whether new legislative initiatives should be proposed to cover cross-border payments in all currencies of the member states of the EU, rather than just the euro.
Although the Commission had targeted 1 January 2019 as the date of application, the member states chose instead for the new rules to apply 12 months after the entry into force of the regulation.
The speed of the agreement between member states was welcomed on Twitter by the European Commissioner for Financial Services, Valdis Dombrovskis, who hopes that Parliament will do likewise, so that inter-institutional negotiations can launch as soon as possible. (Original version in French by Marion Fontana)