Brussels, 30/05/2008 (Agence Europe) - It will be a packed programme including festivities for the last Eurogroup and Ecofin Council meetings under the Slovenian Presidency. As well as celebrations for the anniversaries of the European Central Bank (ECB) and of the European Investment Bank (EIB), both sessions will discuss the increase in food prices. The Ecofin Council will close excess deficit proceedings against Italy and Portugal. In the field of financial services, it will hold a guideline debate on the deposit guarantee systems.
In the framework of the European response to the financial crisis, the European finance ministers will hold a guideline debate on the deposit guarantee systems. The object of these systems is to limit panic reactions on the part of savers, which may cause major problems for a bank (see EUROPE 9565). This situation occurred last September when the British bank Northern Rock was faced with a number of major problems in the wake of the American real estate crisis (see EUROPE 9625). The directive 94/19/EC obliges the member states to set in place compensation systems allowing savers to recover at least €20,000 in the event that the bank managing their deposits goes under. This is implemented differently in different countries of the EU, particularly concerning the factors eligible for compensation, the deposits covered, consumer protection and the funding, by the banks themselves, of national deposit guarantee systems. The ministers will be asked whether they think there is a need to draft new common principles for the regulation in force. Specific actions may be tabled before the end of the year.
The ministers also take note of progress made on the proposed directive "Solvency II", which brings in new European standards for solvency and controls on insurance companies (see EUROPE 9464 and 9465). The Slovenian Presidency takes the view that the "challenge" to be faced in order to reach an agreement "will be to keep in place the economic benefits of an approach based on risk and to try to find a viable solution to the supervision of the insurance groups ". This will not be easy, given the "differing legal and social traditions and differing opinions on the best way of guaranteeing protection for insurance policy-holders", it observes. On this dossier, it is hoped that an inter-institutional political agreement will be found by the end of 2008.
The Ecofin Council will also look at conclusions on work underway at European level in the sector of compensation and delivery versus payment in securities operations. It will draft an inventory of progress made on: - the proposed directive of November 2007 aiming to clarify the VAT exemption enjoyed by financial and insurance companies (see EUROPE 9553); - the general excise regime; - the implementation of the code of conduct on harmful taxation. (A.B./M.B.)