Common position (EC) No 41/2001

adopted by the Council on 7 December 2001

with a view to adopting Regulation (EC) No .../2001 of the European Parliament and of the Council of ... on cross-border payments in euro

(2001/C 363/01)

THE EUROPEAN PARLIAMENT AND THE COUNCIL OF THE EUROPEAN UNION,

Having regard to the Treaty establishing the European Community, and in particular Article 95(1) thereof,

Having regard to the proposal from the Commission(1),

Having regard to the opinion of the Economic and Social Committee(2),

Having regard to the opinion of the European Central Bank(3),

Acting in accordance with the procedure laid down in Article 251 of the Treaty(4),

Whereas:

(1) Directive 97/5/EC of the European Parliament and of the Council of 27 January 1997 on cross-border credit transfers(5) sought to improve cross-border credit transfer services and notably their efficiency. The aim was to enable, in particular consumers and small and medium-sized enterprises to make credit transfers rapidly, reliably and cheaply from one part of the Community to another. Such credit transfers and cross-border payments in general are still extremely expensive compared to payments at national level. It emerges from the findings of a study undertaken by the Commission and released on 20 September 2001 that consumers are given insufficient or no information on the cost of transfers, and that the average cost of cross-border credit transfers has hardly changed since 1993 when a comparable study was carried out.

(2) The Commission's communication to the European Parliament and to the Council of 31 January 2000 on retail payments in the internal market, together with the European Parliament Resolutions of 26 October 2000 on the Commission Communication and of 4 July 2001 on means to assist economic actors in switching to the euro, and the reports of the European Central Bank of September 1999 and September 2000 on improving cross-border payment services have each underlined the urgent need for effective improvements in this field.

(3) The Commission's communication to the European Parliament, the Council, the Economic and Social Committee, the Committee of the Regions and the European Central Bank of 3 April 2001 on the preparations for the introduction of euro notes and coins announced that the Commission would consider using all the instruments at its disposal and would take all the steps necessary to ensure that the costs of cross-border transactions were brought more closely into line with the costs of domestic transactions, thus making the concept of the euro zone as a "domestic payment area" tangible and transparently clear to citizens.

(4) Compared with the objective that was reaffirmed when euro book money was introduced, namely to achieve, if not uniform, at least similar charge structures for the euro, there have been no significant results in terms of reducing the cost of cross-border payments compared to internal payments.

(5) The volume of cross-border payments is growing steadily as completion of the internal market takes place. In this area without borders, payments have been further facilitated by the introduction of the euro.

(6) The fact that the level of charges for cross-border payments continues to remain higher than the level of charges for internal payments is hampering cross-border trade and therefore constitutes an obstacle to the proper functioning of the internal market. This is also likely to affect confidence in the euro. Therefore, in order to facilitate the functioning of the internal market, it is necessary to ensure that charges for cross-border payments in euro are the same as charges for payments made in euro within a Member State, which will also bolster confidence in the euro.

(7) For cross-border electronic payment transactions in euro, the principle of equal charges should apply, taking account of the adjustment periods and the institutions' extra workload relating to the transition to the euro, as from 1 July 2002. In order to allow the implementation of the necessary infrastructure and conditions, a transitional period for cross-border credit transfers should apply until 1 July 2003.

(8) At present, it is not advisable to apply the principle of uniform charges for paper cheques as by nature they cannot be processed as efficiently as the other means of payment, in particular electronic payments. However, the principle of transparent charges should also apply to cheques.

(9) In order to allow a customer to assess the cost of a cross-border payment, it is necessary that he be informed of the charges applied and any modification to them. The same holds for the case where a currency other than the euro is involved in the cross-border euro-payment transaction.

(10) This Regulation does not affect the possibility for institutions of offering an all-inclusive fee for different payment services, provided that this does not discriminate between cross-border and national payments.

(11) It is also important to provide for improvements to facilitate the execution of cross-border payments by payment institutions. In this respect, standardisation should be promoted as regards, in particular, the use of the international bank account number (IBAN)(6) and the bank identifier code (BIC)(7) necessary for automated processing of cross-border credit transfers. The widest use of these codes is considered to be essential. In addition, other measures which entail extra costs should be removed in order to lower the charges to customers for cross-border payments.

(12) To lighten the burden on institutions that carry out cross-border payments, it is necessary to gradually remove the obligations concerning regular national declarations for the purposes of balance-of-payments statistics.

(13) In order to ensure that this Regulation is observed, the Member States should ensure that there are adequate and effective procedures for lodging complaints or appeals for settling any disputes between the originator and his institution or between the beneficiary and his institution, where applicable using existing procedures.

(14) It is desirable that as of July 2004 the Commission should present a report on the implementation of this Regulation.

(15) Provision should be made for a procedure whereby this Regulation can also be applied to cross-border payments made in a currency of another Member State where that Member State so decides,

HAVE ADOPTED THIS REGULATION:

Article 1

Subject matter and scope

This Regulation lays down rules on cross-border payments in euro in order to ensure that charges for those payments are the same as those for payments in euro within a Member State.

It shall apply to cross-border payments in euro up to EUR 50000 within the Community.

This Regulation shall not apply to cross-border payments made between institutions for their own account.

Article 2

Definitions

For the purposes of this Regulation, the following definitions shall apply:

(a) "cross-border payments" means:

(i) "cross-border credit transfers" being transactions carried out on the initiative of an originator via an institution or its branch in one Member State, with a view to making an amount of money available to a beneficiary at an institution or its branch in another Member State; the originator and the beneficiary may be one and the same person;

(ii) "cross-border electronic payment transactions" being: - the cross-border transfers of funds effected by means of an electronic payment instrument, other than those ordered and executed by institutions,

- cross-border cash withdrawals by means of an electronic payment instrument and the loading (and unloading) of an electronic money instrument at cash dispensing machines and automated teller machines at the premises of the issuer or an institution under contract to accept the payment instrument;

(iii) "cross-border cheques" being those paper cheques defined in the Geneva Convention of 19 March 1931 providing uniform laws for cheques drawn on an institution located within the Community and used for cross-border transactions within the Community;,

(b) "electronic payment instrument", means a remote access payment instrument and electronic money instrument that enables its holder to effect one or more electronic payment transactions;

(c) "remote-access payment instrument", means an instrument enabling a holder to access funds held on his/her account at an institution, whereby payment may be made to a payee and normally requires a personal identification code and/or any other similar proof of identity. The remote access payment instrument includes in particular payment cards (whether credit, debit, deferred debit or charge cards) and cards having phone- and home-banking applications. This definition does not include cross-border credit transfers;

(d) "electronic money instrument", means a reloadable payment instrument, whether a stored-value card or a computer memory, on which value units are stored electronically;

(e) "institution", means any natural or legal person which, by way of business, executes cross-border payments;

(f) "charges levied", means any charge levied by an institution and directly linked to a cross-border payment transaction in euro.

Article 3

Charges for cross-border electronic payment transactions and credit transfers

1. With effect from 1 July 2002, charges levied by an institution in respect of cross-border electronic payment transactions in euro up to EUR 12500 shall be the same as the charges levied by the same institution in respect of corresponding payments in euro transacted within the Member State in which the establishment of that institution executing the cross-border electronic payment transaction is located.

2. With effect from 1 July 2003 at the latest, charges levied by an institution in respect of cross-border credit transfers in euro up to EUR 12500 shall be the same as the charges levied by the same institution in respect of corresponding credit transfers in euro transacted within the Member State in which the establishment of that institution executing the cross-border transfer is located.

3. With effect from 1 January 2006 the amount EUR 12500 shall be raised to EUR 50000.

Article 4

Transparency of charges

1. An institution shall make available to its customers in a readily comprehensible form, in writing, including, where appropriate, in accordance with national rules, by electronic means, prior information on the charges levied for cross-border payments and for payments effected within the Member State in which its establishment is located.

Member States may stipulate that a statement warning consumers of the charges relating to the cross-border use of cheques must appear on cheque books.

2. Any modification of the charges shall be communicated in the same way as indicated in paragraph 1 in advance of the date of application.

3. Where institutions levy charges for exchanging currencies into and from euro, institutions shall provide their customers with:

(a) prior information on all the exchange charges which they propose to apply; and

(b) specific information on the various exchange charges which have been applied.

Article 5

Measures for facilitating cross-border transfers

1. An institution shall, where applicable, communicate to each customer upon request his international bank account number (IBAN) and that institution's bank identifier code (BIC).

2. The customer shall, upon request, communicate to the institution carrying out the transfer the IBAN of the beneficiary and the BIC of the beneficiary's institution. If the customer does not communicate the above information, additional charges may be levied on him by the institution. In this case, the institution must provide customers with information on the additional charges in accordance with Article 4.

3. With effect from 1 July 2003, institutions shall indicate on statements of account of each customer, or in an annex thereto, his IBAN and the institution's BIC.

4. For all cross-border invoicing of goods and services in the Community, a supplier who accepts payment by transfer shall communicate his IBAN and the BIC of his institution to his customers.

Article 6

Obligations of the Member States

1. Member States shall remove with effect from 1 July 2002 at the latest any national reporting obligations for cross-border payments up to EUR 12500 for balance-of-payment statistics.

2. Member States shall remove with effect from 1 July 2002 at the latest any national obligations as to the minimum information to be provided concerning the beneficiary which prevent automation of payment execution.

Article 7

Compliance with this Regulation

Compliance with this Regulation shall be guaranteed by effective, proportionate and deterrent sanctions.

Article 8

Review clause

Not later than 1 July 2004, the Commission shall submit to the European Parliament and to the Council a report on the application of this Regulation, in particular on:

- changes in cross-border payment system infrastructures,

- the advisability of improving consumer services by strengthening the conditions of competition in the provision of cross-border payment services,

- the impact of the application of this Regulation on charges levied for payments made within a Member State,

- the advisability of increasing the amount provided for in Article 6(1) to EUR 50000 as from 1 January 2006, taking into account any consequences for undertakings.

This report shall be accompanied, where appropriate, by proposals for amendments.

Article 9

Entry into force

This Regulation shall enter into force on the third day following that of its publication in the Official Journal of the European Communities.

This Regulation shall also apply to cross-border payments made in the currency of another Member State when the latter notifies the Commission of its decision to extend the Regulation's application to its currency. The notification shall be published in the Official Journal by the Commission. The extension shall take effect 14 days after the said publication.

This Regulation shall be binding in its entirety and directly applicable in all Member States.

Done at ...

For the European Parliament

The President

For the Council

The President

(1) OJ C 270 E, 25.9.2001, p. 270.

(2) Opinion delivered on ... (not yet published in the Official Journal).

(3) OJ C 308, 1.11.2001, p. 17.

(4) Opinion of the European Parliament of 15 November 2001 (not yet published in the Official Journal), Council Common Position of 7 December 2001 and Decision of the European Parliament of ... (not yet published in the Official Journal).

(5) OJ L 43, 14.2.1997, p. 25.

(6) ISO standard No 13613.

(7) ISO standard No 9362.

STATEMENT OF THE COUNCIL'S REASONS

I. INTRODUCTION

1. On 13 August 2001, the Commission submitted to the Council the abovementioned proposal for a regulation of the European Parliament and of the Council(1), based on Article 95 of the Treaty.

2. The European Parliament delivered its opinion on 15 November 200(2).

3. The Economic and Social Committee delivered its opinion on 29 November 2001(3).

4. On 7 December 2001, the Council adopted its Common Position in accordance with Article 251 of the Treaty.

II. OBJECTIVE

The aim of the proposal is to reduce bank charges for cross-border payments in euro to bring them into line with those applying at national level, at the same time as the introduction of euro notes and coins on 1 January 2002.

Delivering on a long-standing policy of the European Commission, which has been examining the operation of payments in the European internal market since the end of the 1980s, this text will enable European consumers to participate actively in the internal market by ensuring that they are able to benefit from increased price transparency and choice. The Regulation responds to the concerns expressed by citizens in particular, and by the European Parliament, and is also intended to bolster confidence in the euro.

III. ANALYSIS OF THE COMMON POSITION

A. General remarks

In general, the Council has followed most of the European Parliament's amendments, accepting them in whole or in substance.

Like the European Parliament, the Council considered that the deadline of 1 January 2002 for electronic payment transactions should be put back to avoid possible interference with the introduction of euro notes and coins. In view of the adjustment periods and extra workload relating to the period during which two currencies are in circulation, the Council considered it appropriate to put the deadline back to 1 July 2002.

The deadline for cross-border credit transfers was put back to 1 July 2003, in order to allow the implementation of the necessary infrastructure and conditions (see recital 7).

B. Main innovations introduced by the Council of the European Union

The main innovations introduced by the Council are the following:

(a) Taking account of other currencies

In response to the concerns of certain Member States, which were anxious to ensure the proper functioning of the internal market, provision was made for the Member States that so wished to extend the application of the Regulation to cross-border payments made in the currency of another Member State (Article 9, third paragraph).

(b) Increased transparency

Article 4 has been strengthened to ensure better information for consumers, particularly in relation to the cross-border use of cheques.

(c) Amounts

In view of the fact that the great majority of cross-border payments of less than EUR 50000 are also less than EUR 12500, and that the latter also serves as a reference amount for the purposes of balance-of-payments statistics, the Council considered that only transactions of less than EUR 12500 should be covered initially. Provision was made for raising the threshold to EUR 50000 on 1 January 2006 as regards Article 3.

(d) Review clause

To respond to the concerns expressed by certain Member States, the points to which Commission will need to pay special attention in the report provided for in Article 8 have been stipulated. These points are changes in infrastructures for cross-border payment systems, the advisability of improving consumer services by strengthening the conditions of competition in the provision of cross-border payment services, and the advisability of removing the obligation for a national declaration for amounts up to EUR 50000, taking the possible consequences for companies into account. Moreover, the essence of the idea underlying European Parliament amendment 4 was reflected in the indent on the impact of the application of the Regulation on charges levied for payments made within a Member State.

An in-depth study of these questions should enable the Commission to accompany the report, where appropriate, by proposals for amendments.

IV. CONCLUSIONS

The Council considers that the Common Position responds to a large extent to the wishes and concerns expressed by the European Parliament and other interested parties, and achieves a good balance between the prerequisites for the proper functioning of the single market and consumer protection/information.

(1) OJ C 270 E, 25.9.2001, p. 270.

(2) Not yet published in the Official Journal. See 13713/010 CONSOM 104 MI 183 EF 119 ECOFIN 351 CODEC 1231.

(3) Not yet published in the Official Journal.

Information procedure - Technical rules

(2001/C 363/03)

(Text with EEA relevance)

Directive 98/34/EC of the European Parliament and of the Council of 22 June 1998 laying down a procedure for the provision of information in the field of technical standards and regulations and rules on Information Society services (OJ L 204, 21.7.1998, p. 37; OJ L 217, 5.8.1998, p. 18).

Notifications of draft national technical rules received by the Commission

>TABLE>

The Commission draws attention to the judgment given on 30 April 1996 in the "CIA Security" case (C-194/94 - ECR I, p. 2201), in which the Court of Justice ruled that Articles 8 and 9 of Directive 98/34/EC (formerly 83/189/EEC) are to be interpreted as meaning that individuals may rely on them before the national court which must decline to apply a national technical regulation which has not been notified in accordance with the Directive.

This judgment confirms the Commission's Communication of 1 October 1986 (OJ C 245, 1.10.1986, p. 4).

Accordingly, breach of the obligation to notify renders the technical regulations concerned inapplicable, so that they are unenforceable against individuals.

If you require any information on these notifications, please contact the national departments listed below:

LIST OF NATIONAL DEPARTMENTS RESPONSIBLE FOR THE MANAGEMENT OF DIRECTIVE 98/34/EC

BELGIUM

Institut belge de normalisation/Belgisch Instituut voor Normalisatie Avenue de la Brabançonne/Brabançonnelaan 29 B - 1040 Brussels Mrs Hombert Tel.: (32 2) 738 01 10 Fax: (32 2) 733 42 64 X400:O=GW;P=CEC;A=RTT;C=BE;DDA:RFC-822=CIBELNOR(A)IBN.BE

Internet: cibelnor@ibn.be

Mrs Descamps Tel.: (32 2) 206 46 89 Fax: (32 2) 206 57 45 Internet: normtech@pophost.eunet.be

DENMARK

Danish Agency for Trade and Industry

Dahlerups Pakhus

Lagelinie Allé 17 DK - 2100 Copenhagen Ø Mr K. Dybkjaer Tel.: (45) 35 46 62 85 Fax: (45) 35 46 62 03 X400:C=DK;A=DK400;P=EFS;S=DYBKJAER;G=KELD

Internet: kd@efs.dk

GERMANY

Bundesministerium für Wirtschaft und Technologie Referat V D 2 Villenomblerstraße 76 D - 53123 Bonn Mr Shirmer Tel.: (49-228) 615 43 98 Fax: (49-228) 615 20 56 X400:C=DE;A=BUND400;P=BMWI;O=BONN1;S=SHIRMER

Internet: Shirmer@BMWI.Bund400.de

GREECE

Ministry of Development General Secretariat of Industry Michalacopoulou 80 GR - 115 28 Athens Tel.: (30-1) 778 17 31 Fax: (30-1) 779 88 90 ELOT Acharnon 313 GR - 11145 Athens Mr E. Melagrakis Tel.: (30-1) 212 03 00 Fax: (30-1) 228 62 19 Internet: 83189@elot.gr

SPAIN

Ministerio de Asuntos Exteriores Secretaría de Estado de política exterior y para la Unión Europea

Dirección General de Coordinación del Mercado Interior y otras Políticas Comunitarias

Subdirección general de asuntos industriales, energeticos, transportes, comunicaciones y medio ambiente

c/Padilla 46, Planta 2a, Despacho 6276 E - 28006 Madrid Mrs Nieves García Pérez Tel.: (34-91) 379 83 32 Mrs María Ángeles Martínez Álvarez Tel.: (34-91) 379 84 64 Fax: (34-91) 575 56 29/575 86 01/431 55 51 X400:C=ES;A=400NET;P=MAE;O=SEPEUE;S=D83-189

FRANCE

Délégation interministérielle aux normes SQUALPI 64-70 allée de Bercy - télédoc 811 F - 75574 Paris Cedex 12 Mrs S. Piau Tel.: (33-1) 53 44 97 04 Fax: (33-1) 53 44 98 88 Internet: suzanne.piau@industrie.gouv.fr

IRELAND

NSAI

Glasnevin

Dublin 9 Ireland Mr Owen Byrne Tel.: (353-1) 807 38 66 Fax: (353-1) 807 38 38 X400:C=IE;A=EIRMAIL400;P=NRN;0=NSAI;S=BYRNEO

Internet: byrneo@nsai.ie

ITALY

Ministero dell'Industria, del commercio e dell'artigianato via Molise 2 I - 00100 Roma Mr P. Cavanna Tel.: (39-06) 47 88 78 60 X400:C=IT;A=MASTER400;P=GDS;OU1=M.I.C.A-ISPIND;DDA:CLASSE=IPM;DDA:ID-NODO=BF9RM001;S=PAOLO CAVANNA Mr E. Castiglioni Tel.: (39-06) 47 05 30 69/47 05 26 69 Fax: (39-06) 47 88 77 48 Internet: Castiglioni@minindustria.it

LUXEMBOURG

SEE - Service de l'Énergie de l'État 34 avenue de la Porte-Neuve BP 10 L - 2010 Luxembourg Mr J.P. Hoffmann Tel.: (352) 46 97 46 1 Fax: (352) 22 25 24 Internet: jean-paul.hoffmann@eg.etat.lu

THE NETHERLANDS

Ministerie van Financiën - Belastingsdienst - Douane Centrale Dienst voor In- en uitvoer (CDIU) Engelse Kamp 2 Postbus 30003 9700 RD Groningen Nederland Mr IJ. G. van der Heide Tel.: (31-50) 5 23 91 78 Fax: (31-50) 5 23 92 19 Mrs H. Boekema Tel.: (31-50) 5 23 92 75 E-mail X400:C=NL;A=400NET;P=CDIU;OU1=CDIU;S=NOTIF

AUSTRIA

Bundesministerium für wirtschaftliche Angelegenheiten Abt. II/1 Stubenring 1 A - 1011 Wien Mrs Haslinger-Fenzl Tel.: (43-1) 711 00 55 22/711 00 54 53 Fax: (43-1) 715 96 51 X400:S=HASLINGER;G=MARIA;O=BMWA;P=BMWA;A=GV;C=AT

Internet: maria.haslinger@bmwa.gv.at

X400:C=AT;A=GV;P=BMWA;O=BMWA;OU=TBT;S=POST

PORTUGAL

Instituto português da Qualidade Rua C à Avenida dos Três vales P - 2825 Monte da Caparica Mrs Cândida Pires Tel.: (351-1) 294 81 00 Fax: (351-1) 294 81 32 X400:C=PT;A=MAILPAC;P=GTW-MS;O=IPQ;OU1=IPQM;S=DIR83189

FINLAND

Kauppa- ja teollisuusministeriö

Ministry of Trade and Industry

Aleksanterinkatu 4 PL 230 (PO Box 230) FIN - 00171 Helsinki Mr Petri Kuurma Tel.: +358-9-160 3627 Fax: +358-9-160 4022 Internet: petri.kuurma@ktm.vn.fi Website: http://www.vn.fi/ktm/index.html X400:C=FI;A=MAILNET;P=VN;O=KTM;S=TEKNISET;G=MAARAYKSET

SWEDEN

Kommerskollegium

(National Board of Trade)

Box 6803 S - 11386 Stockholm Mrs Kerstin Carlsson Tel.: 46 86 90 48 00 Fax: 46 86 90 48 40 E-mail: kerstin.carlsson@kommers.se

X400:C=SE;A=400NET;O=KOMKOLL;S=NAT NOT POINT

Website: http://www.kommers.se

UNITED KINGDOM

Department of Trade and Industry Standards and Technical Regulations Directorate 2 Bay 327

151 Buckingham Palace Road

London SW 1 W 9SS United Kingdom Mrs Brenda O'Grady Tel.: (44) 171 215 14 88 Fax: (44) 171 215 15 29 X400:S=TI, G=83189, O=DTI, OU1=TIDV, P=HMG DTI, A=Gold 400, C=GB

Internet: uk98-34@gtnet.gov.uk

Website: http://www.dti.gov.uk/strd

EFTA - ESA

EFTA Surveillance Authority (DRAFTTECHREGESA) X400:O=gw;P=iihe;A=rtt;C=be;DDA:RFC-822=Solveig.Georgsdottir@surv.efta.be

C=BE;A=BT;P=EFTA;O=SURV;S=DRAFTTECHREGESA

Internet: Solveig.Georgsdottir@surv.efta.be