Madam President, I welcome and support both the reports we are discussing today. They are excellent and I congratulate both the rapporteurs on the hard work that they have done on them. It is vitally important to get the investment services directive right because the rewards will be an increased return for savers and cheaper products for consumers. But the ISD, I am afraid, symbolises much of what is both good and bad about current EU legislation. It is a good idea in theory but it has not yet delivered in practice. It has produced a single market on paper, but not yet a single market in reality. It was supposed to have made it possible for a firm or a company complying with its own home rules to have a passport to trade anywhere across the European Union. It has not delivered that in practice because of differences in interpretation between Member States, because of differences in enforcement between Member States and because of poor implementation. It is really unacceptable that almost eight years after adoption there are still some Member States trying to work out how they are going to enforce this directive. The result has undermined both the country-of-origin principle and the principle of the single passport, because operators still face multiple, overlapping and sometimes conflicting sets of rules when they trade across the European Union – just the problem which the ISD was supposed to tackle. This is really a textbook case of where the single market legislation has not actually delivered. We have an increased administrative and bureaucratic burden, which still leaves different firms facing over 15 different legal systems and rule systems. The conduct-of-business rules have been used by Member States to impose their own host-state rules where they are neither necessary nor desirable and I would include the UK in that. These conduct-of-business and advertising rules have been used to protect markets rather than consumers and the Commission should clamp down strongly on that. I very much welcome the call in the two reports to move to a country-of-origin principle for conduct-of-business rules, for advertising rules, for retail investors and for wholesale investors. I hope the Commission will take note of what Parliament has said because where the Commission can be criticised in its upgrade is that it is too tentative on these vital issues. We should have a country-of-origin approach underlying this directive. I do not see why we cannot trust consumers to pick a product from other Members of the European Union and to be protected by the financial services authorities of those other Members of the European Union. Consumers are receiving proper and appropriate protection from different countries which have been in this very close relationship now for almost 50 years. It is vital to ensure that we are consistent with the e-commerce directive, and a country-of-origin approach will be consistent with the e-commerce directive if we adopt it in the ISD. Any exception to the country-of-origin approach, whether in the ISD or in the e-commerce directive, should be strictly interpreted, narrowly interpreted and should be eliminated as soon as possible. Minor updates to the ISD are, of course, welcome but above all we need a change of culture. The Commission has been far too tentative in enforcement. It is unacceptable that for many years many countries simply failed to distinguish properly between professional and consumer investors as is required by the ISD. I would like to see the Commission make full use of its enforcement powers to make sure the current version of the ISD is enforced properly by every single Member State and indeed that the next version of the ISD is also properly enforced. IN THE CHAIR: MR VIDAL-QUADRAS ROCAVice-President

Political group: PPE-DE