Stockholm, 23/03/2001 (Agence Europe) - The Finance Ministers, gathered Thursday evening in Stockholm, agreed on resolution concerning the Lamfalussy report that aims to accelerate the integration of financial markets. The draft agreement had already received the support of fourteen Member States, on Wednesday within the Coreper, but Germany had withheld its position. The resolution which does not retain the "aerosol clause", desired by Germany and which would have forced the European Commission to take into account the opinion issued by a simple majority of the Council during the proposal for implementation measures. It nevertheless gave sufficient reassurance to Germany by referring to the comitology procedure raised in the decision on 28 June 1999 and by foreseeing that the European executive "avoids moving against the predominant views" of the Council. This agreement puts and end to the tug of war between the Commission and the Council over the respective balance of power in the comitology process. The Swedish Finance Minister, Bosse Ringholm, acting President of the Ecofin Council , stated that this agreement is a important step for the modernisation of the securities markets. Commissioner Frits Bolkestein, responsible for the Internal market, welcomed a solution that would allow for the establishment of a faster decision-making mechanism, while respecting the balance between the Council, the Commission and the European Parliament. It would be surprising that the Commission goes against the opinion of the Member States, he added. The German Finance Minister Hans Eichel considered the compromise "positive".
The aim of the report by the Group of Wise chaired by Alexandre Lamfalussy is to achieve the integration of the financial markets by 2005, in order to make up for the delay experienced in the European markets divided by different national legislation compared to the more integrated and efficient American market. While the European institutions have always been in agreement over the fundamentals of the Lamfalussy report, the end of the stalemate on an - important - issue of procedure is crucial to the extent that the investors regularly move away from the European financial markets. The mechanism suggested by the "Wise" simplifies the procedure by entrusting the adoption of the framework legislation to the Council and Parliament acting in codecision. The implementation measures are adopted by a European Securities Committee, on proposals from the Commission, after the consultation of a committee of European securities regulators.
For Mr Bolkestein, the core issue lies in the interpretation that will be given on a case by case basis to the expression "predominant view of the Council" and to "especially sensitive case" in which the Commission avoids going against the Council. The Commissioner gave an initial indication by considering that the term "predominant" includes the decisions taken by the Member States between the limits of the simple majority and those of qualified majority. Adding: it should not be a case of seeing who wins or looses, in fact, nothing has changed compared to the 1999 decision on the comitology procedure. The provision will be revised in 2004 and will possibly be followed by the creation of a single European regulatory authority for the financial markets. The road is now clear between the Commission and Council to implement the Lamfalussy report. On Thursday evening, Mr Ringholm invited the European Commission to present the Swedish Presidency with the initial proposals for the reform of the financial markets. Mr Bolkestein foresees proposing, relatively quickly, Directives on certain aspects, such as for prospectus and market abuses. The European Parliament, on the contrary, did not gain satisfaction for its demand to have a binding right to call back at the level of implementation measures. The next step will consist of deciding, on a case by case basis, what will be the limit between the framework legislation, in which the Parliament has an active role in the codecision process, and the implementation measures, where it only has the non-binding right to call back with regards to the Commission initiatives.
Below is the text of the compromise on the comitology procedure included in the draft European Council resolution on the Lamfalussy report: The European Council notes that, in the framework of the decision by the comitology on 28 June 1999, the Commission has committed itself, in order to find a balanced solution to the case of implementation measures in the field of securities markets, which are recognised as especially sensitive in the light of the discussions, to avoid going against the predominant views that could emerge from the Council, as to the appropriate nature of such measures. This commitment does not constitute a precedent".