OPINION OF THE COMMISSION pursuant to Article 251(2), third subparagraph, point (c) of the EC Treaty on the European Parliament's amendments to the Council's common position regarding the proposal for a DIRECTIVE OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL concerning the distance marketing of consumer financial services and amending Directives 97/7/EC and 98/27/EC AMENDING THE PROPOSAL OF THE COMMISSION pursuant to Article 250(2) of the EC Treaty

1998/0245 (COD)

OPINION OF THE COMMISSION pursuant to Article 251(2), third subparagraph, point (c) of the EC Treaty on the European Parliament's amendments to the Council's common position regarding the proposal for a DIRECTIVE OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL concerning the distance marketing of consumer financial services and amending Directives 97/7/EC and 98/27/EC.

1. Introduction

Article 251(2), third subparagraph, point (c) of the EC Treaty requires the Commission to deliver an opinion on the amendments proposed by the European Parliament at second reading. The Commission's opinion on the two amendments proposed by Parliament is set out below.

2. Background

On 19 November 1998, the Commission presented to the European Parliament and the Council a proposal for a Directive [1] of the European Parliament and of the Council concerning the distance marketing of consumer financial services and amending Directives 90/619/EEC, 97/7/EC and 98/27/EC.

[1] OJ C 385, 11.12.1998, p. 10.

The Economic and Social Committee delivered its opinion on 29 April 1999 [2].

[2] OJ C 169, 16.6.1999, p. 43.

On 5 May 1999 the European Parliament adopted at first reading a legislative resolution [3] comprising 36 amendments to the Commission proposal.

[3] OJ C 279, 1.10.1999, p. 197.

The Commission presented its amended proposal to the Council on 23 July 1999 [4].

[4] COM (1999) 385 final of 23.7.1999, OJ C 177 E, 27.6.2000, p 21.

The Council adopted its common position on 19 December 2001 [5].

[5] OJ C 58 E, 5.3.2002, p. 32.

On 14 January 2002 the Commission adopted a communication to the European Parliament [6] on the Council's common position.

[6] SEC (2002) 30 final.

On 14 May 2002 the European Parliament voted at second reading two amendments to the common position.

3. Purpose of the proposal

The Directive aims to establish an appropriate harmonised legal framework governing distance contracts for financial services. It consolidates and completes the existing legal framework so as to facilitate the functioning of the internal market while establishing an appropriate level of consumer protection.

The Directive in particular comprises details of the information that has to be provided before conclusion of the contract, an obligation to provide written confirmation of this information, a right of withdrawal except in the case of certain specific services, the principle of payment for the service provided before withdrawal, consumer protection with regard to payment by card, a ban on unsolicited sales, a limit on using means of distance communication, and measures to facilitate the settling of disputes.

4. Opinion of the Commission on Parliament's amendments

At second reading, the European Parliament adopted two amendments (43 and 44) to the Council's common position.

For the reasons set out below, the Commission can accept these amendments.

The purpose of amendment 43 is to resolve the problem posed by the exercising of the right of withdrawal in the event of the involvement of a notary. The amendment to Article 6(3) adds a new point (ba), allowing Member States to provide that the right of withdrawal does not apply to all declarations made before a notary, provided the notary confirms that the consumer's rights under Article 5(1) have been respected.

The idea is to take account, on the one hand, of the legal problems which would arise from the withdrawal of a notarial act and, on the other hand, of the guarantees offered by the involvement of a notary in terms of consumer protection. The wording takes account of the legal situation in the Member States which do not have civil law notaries.

The Commission, aware of the problem which might be posed by the undifferentiated application of the right of withdrawal to all such acts, and in view of the additional guarantees accompanying the exception, accepts the inclusion of this provision, with a view to reaching a compromise and achieving rapid adoption of the Directive.

The purpose of amendment 44 is to clarify the provisions of Article 7(3), under which payment for the service provided before the right of withdrawal was exercised may be required by the supplier only if the consumer asked for performance of the contract to start before expiry of the withdrawal period. The amendment makes the principle clearer, by stipulating that the performance of the contract may only begin after the consumer has given approval. It also means that the supplier can decide not to commence performance of the contract before expiry of the withdrawal period, in which case the consumer could not be required to pay any penalty under Article 7.

The Commission regards this clarification as relevant and therefore accepts the inclusion of this provision, with a view to reaching a compromise and achieving rapid adoption of the Directive.

5. Conclusion

Pursuant to Article 250(2) of the EC Treaty, the Commission is amending its proposal in line with the above.