MEPs on the European Parliament’s Committee on Economic and Monetary Affairs (ECON) debated, on Tuesday 24 October, the draft report by Stéphanie Yon-Courtin (Renew Europe, French) on the Retail Investment Strategy (see EUROPE 13264/22). While the French MEP seems to have the support of the right on the issue of a total ban on commissions paid to brokers and other intermediaries, compromises will have to be found to rally the left-wing political groups to her cause.
“I do not believe that a total or partial ban is the solution for consumers. More than 50% of people who invest still consult their advisers. They want online services with human contact. We need to find solutions and, in my view, this means providing a better framework for the consultancy business”, said Ms Yon-Courtin.
On this point, the French MEP can count on the support of the EPP. “We must oppose the ban. Above all, we need to ask ourselves what is helping investors and not hide behind the cloak of consumer protection. We can see what the Netherlands and the UK are doing with this ban. We should put emotions aside and stick to the facts”, said Ralf Seekatz (EPP, German).
On the other hand, for others such as Claude Gruffat (Greens/EFA, French), a balance still needs to be found on this issue. “We cannot deny that there are cases of conflicts of interest”, he said, pointing out that the impact study carried out by the European Commission prior to its legislative proposal argued in favour of a ban.
The European Commission had initially decided to rely on a total ban, but then backed down and proposed a partial ban in the case of sales in execution, i.e. without any advisory activity (see EUROPE 13187/21).
“Our group is in favour of banning commissions”, said Eero Heinäluoma (S&D, Finnish), echoing Mr Gruffat’s arguments on potential conflicts of interest. He added in response to Mr Seekatz: “It cannot be denied that prosperity increases when there is no incentive. The quality of advice improved when commissions were banned”.
In addition, future negotiations in Parliament will also address the issue of benchmarks, all of which were removed in Ms Yon-Courtin’s report presented on 4 October. “I have my doubts about their feasibility as they stand. What methodology? On the basis of what data? How do you compare European products? For the time being, this has been removed so that we can reintroduce real value for money”, explained the rapporteur, who wants to see more account taken of the qualitative aspects of financial products.
In addition, negotiations are expected to be held on other issues, in particular that of financial influencers, with the idea of a contractual obligation to have knowledge of the products they are promoting. (Original version in French by Thomas Mangin)