Brussels, 04/05/2007 (Agence Europe) - There are not many items on the agenda of the Tuesday 8 May ECOFIN Council in Brussels and no major decisions are expected to be taken. The Council will adopt conclusions on three ongoing issues in the financial services industry, namely the growing influence of hedge funds on the stability of financial markets, the EU framework for investment funds and the impact of the ageing population on financial services. The EU member states' ambassadors have already agreed upon the conclusions document. On 7 May, the Eurogoup will discuss the European Commission's spring economic forecasts.
As announced two years ago at the Berlin meeting (see EUROPE 9412), the ministers will adopt conclusions on hedge funds and may discuss the issue too. The conclusions take note of how hedge funds contribute to growth and liquidity on the financial markets but highlight the potential dangers inherent in them (see related article). The conclusions are part of an international debate on hedge funds (see EUROPE 9359 and 9409).
The ECOFIN Council will also adopt conclusions on the European Commission's White Paper on improving the European framework for the common market in investment funds (see EUROPE
9308), asking the Commission to unveil legislation to amend Directive 85/611/EEC to target improvement in the marketing and cross-border merging UCITS, undertakings for collective investment in transferable securities.
When it comes to the impact of population ageing on the financial markets, the finance ministers will take note of a special report by the Financial Services Committee and will adopt conclusions calling on EU member states to encourage households to join private pension schemes in addition to the state pension system. The document instructs the Commission to examine the need for a single market in pension-related financial products.
Still in the field of financial services, the ECOFIN Council will discuss priorities for the future review of the 'Lamfalussy Process', which will guide EU legislation in the field. The president of the Inter-institutional Surveillance Group (ISG) will present the ISG's second interim report to ministers, calling for regulatory self-limitation at all levels (see EUROPE 9356). EU Internal Market Commissioner Charlie McCreevy will express his views on this issue.
Over dinner, the German presidency will brief the delegations on the draft directive on harmonising car tax for individuals (see EUROPE 8984). Given the extremely slow progress at the Council on a draft directive dating back to July 2005, the German presidency is expected to focus work on scrapping double taxation and introducing sustainability certificates of cars' CO2 emissions for the taxation of private cars. The controversial issue of scrapping car registration fees will probably be left to one side for the moment.
On Monday evening, the Eurogroup will discuss the Spring Economic Forecasts published the same day by the European Commission (see EUROPE 9419). The ministers will also look at the link between budget policies and inflation, and the functioning of Economic and Monetary Union in terms of worker mobility.
There will also be a meeting of the ECOFIN Council and the finance ministers and Central Bank governors of candidate countries (the Former Yugoslav Republic of Macedonia, Croatia and Turkey). After this discussion among ministers, conclusions on the pre-accession economic programmes for the three countries will be adopted. Finally, the Commission will present its Preliminary Draft Budget for 2008, focussing on employment and growth (see EUROPE 9418). (mb/ab)