Madam President, Commissioner Bolkestein, ladies and gentlemen, first of all I would like to express my thanks to the Commission. This communication was so skilfully drafted in fact that we in Parliament were able to reach consensus both in the Committee and here in the plenary sitting. There was not a single amendment made to my report, which I am very happy about. Article 11 of the investment services directive needs to be revised to remove the legal uncertainty that prevails nowadays in the European investment markets as well as overlapping and conflicting rules. Factors of uncertainty such as these hamper the success of the internal market and result in considerably increased costs, which European investors ultimately have to pay. We must ensure that all investors have the opportunity to participate in the internal investment services market, safe in the knowledge that European legislation will provide the appropriate freedoms and, if required, adequate protection. My report proposes that any clarification of Article 11 will work best if the country-of-origin principle is applied to all investment services provided across borders. From the point of view of professional investors, it will be possible to switch quickly to the country-of-origin principle, but, from the consumer’s point of view, applying the principle still requires greater harmonisation of the conduct of business rules that affect them. This is very much under way in FESCO. Complete harmonisation is not a prerequisite, however, for the country-of-origin principle to also be applied to retail sales of investment services for the small investor. This solution would, at the same time, be consistent with the electronic commerce directive, which was passed last spring, and which Member States are under an obligation to adopt as part of their own legislation by 1 January 2002. If these two directives do not work on the same basis, the position of customers purchasing investment services electronically will be different from that of consumers who purchase their services through traditional channels. The basic idea behind the classification of investors is that different investors need different kinds of protection and, on the other hand, are entitled to demand greater freedoms as their experience grows. European legislators must ensure that a lighter conduct of business regime should apply to professional investors than to small investors, who need more legal protection. Restrictions on the freedom to provide services can only be sustained when they are applied in the interests of the general good. For example, for transactions between professional investors rules for the general good should not be required. Restricting the market for reasons connected with the general good is not, as a rule, possible either. Any interpretation of Article 11 of the directive on investment services must in any case be consistent with Articles 3.4 and 3.5 of the electronic commerce directive. The host country may thus only restrict the free movement of services to protect investors on a case by case basis and in compliance with a special procedure and a list of specific conditions. Commissioner, my report contains reservations with regard to the three categories of investor, as proposed by FESCO. Rules that are too strict may make it needlessly difficult for investors in the middle category to operate in the internal market, especially as we are giving them the chance to opt-up to higher protection, if they so wish. There is also a degree of uncertainty regarding what categories will be entitled to benefit from the country-of-origin principle. The Commission should clarify this and propose that, in principle, all who have opted for the level of protection intended for professional investors, that is to say, a lighter level of protection, should always be able to benefit from the country of origin system in cross-border services. Another issue which merits further consideration on the part of the Commission is the application of rules for marketing and advertising. The current ISD already states that the right to market services in the internal market can only be restricted for reasons connected with the general good. Despite this, many Member States have included advertising rules in their conduct of business rules. This may lead to rules that overlap. Finally, I would like to mention the proposal by the Lamfalussy Committee that the revision and updating of the ISD would, in many respects, be an ideal example of a legislation project where the new procedure proposed by Mr Lamfalussy could be applied. The problems in the present ISD have mainly led to difficulties of interpretation, so it will be important to ensure the amended directive is implemented consistently at national level, to achieve a successful result. Just to have a good and relevant directive will not be enough.

Political group: PPE-DE