Brussels, 28/09/2001 (Agence Europe) - At the Internal Market Council in Brussels on Thursday, France, Germany, the Netherlands and Finland had reservations about the draft Regulation on cross-border payments unveiled last July, highlighting the danger of the cost of domestic transfers going up. The Internal Market Commissioner, Frits Bolkestein, who was presenting his proposal to the Council for the first time, swept the objection aside, asserting that inter-bank competition would prevent any rise.
Noting that charges for cross-border transfers were still very high (24 euro on average for a 100 euro payment), the Commission had put forward a draft regulation that would make banks charge the same amount for a cross-border transfer as they do for domestic transfers and for card payments and withdrawals as from 1 January 2002; and for cheques and transfers between bank accounts as from January 2003. The Belgian Economics Minister and President of the Council, Charles Piqué, told EUROPE that everyone realised that there was a cost problem, but some feel that the deadline proposed by the Commission is too short, and many want the European Central Bank to be involved. The Netherlands in particular has called for the ECB to have a coordination role in the bank transfer system.
The French Secretary of State for Consumer Affairs, François Patriat, told journalists that they agreed with the objectives but detailed work remained to be carried out on the mechanisms, adding that they did not want the less well-off consumer to be penalised. The German Secretary of State, Alexander Müller, said that consumers risked being hit by a large rise in the cost of domestic transactions since the infrastructure does not yet allow cross-border payments to be made as easily as domestic ones. The Finnish European Affairs Minister, Kimmo Sasi, noted that Finns carried out more than 80% of their bank transactions electronically, because of the low cost, but the banks made up for this by charging more for cross-border transfers. The Swedish delegate supported the Commission's proposal, but insisted that the Regulation should also cover countries that were not part of the eurozone.
Commissioner Frits Bolkestein told journalists that the Commission did not have the power to block a rise in domestic bank charges, but competition suggests that there will not be any increase. The Regulation foresees transparency rules whereby consumers will be informed of the cost of cross-border payments and any rise in charges. The Commissioner also indicated that there was no reason for cross-border payments to fall under the responsibility of the ECB, since the Regulation is based on Treaty Article 95, under the responsibility of the internal market, rather than ECOFIN. He pointed out, however, that at last Saturday's ECOFIN Council in Liège, the Ministers had asked the ECB to prepare a report for December on the creation of a new payment system.