WRITTEN QUESTION E-2864/02

by Charles Tannock (PPE-DE) to the Commission

(11 October 2002)

Subject: The cost of bank transfers and the Commission's powers to authorise legal proceedings

In his extremely clear and helpful answer to Written Question E-2271/02(1), Commissioner Bolkestein has outlined the legal position regarding the permitted charges for cross-border credit transfers.

As the Commissioner will be aware, there has been considerable discussion in the Economic and Monetary Affairs Committee of the European Parliament about the cost of transfers within the Eurozone and the widespread practice of double-charging by the receiving as well as the executing bank in the case of OUR transfers in contravention of the terms of the Cross-Border Credit Transfer Directive (Directive 97/5/EC(2)

of the Parliament and of the Council of 27 January 1997). The Commissioner says in his reply that if any unlawful charges are levied by a bank then the customer is entitled to be credited the amount which has been wrongly deducted adding that all Member States have correctly transposed the Directive on this point, but that the Commission cannot take any legal proceedings if customers are not using their rights.

Is the Commission saying that even if a Member State government or Central Bank is consistently failing to ensure that its banks are respecting the terms of the Directive that the Commission has no legal power to refer the Member State to the European Court of Justice?

If the Commission does have that power and fails to use it, and subsequently refuses to respond to requests from natural or legal persons who have suffered financially as a consequence of the Commission's refusal to act, does the Commission believe that under Article 232 of the Consolidated Treaty that such persons would have the right after two months to complain to the Court of Justice on the basis that an institution of the Community (the Commission) has failed to address to that person any act other than a recommendation or opinion?

(1) OJ C 137 E, 12.6.2003, p. 66.

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

Answer given by Mr Bolkestein on behalf of the Commission

(19 November 2002)

The application of Directive 97/5/EC on cross-border credit transfers has been closely monitored by the Commission, on behalf of which many studies on price trends and on national transposal measures have been carried out. This information is available at the following address: http://europa.eu.int/comm/internal_market/en/finances/payment/directives/index.htm

The OUR payments procedure (all charges payable by the originator) was introduced to end the practice whereby a deduction was made, usually by an intermediate bank, from the amount transferred. It transpires from the Commission's examination of national transposal measures that this provision has been correctly incorporated into national law. It may, however, be the case that the national provision is incorrectly applied, often because of misinterpretation of the national legislation by one of the parties involved. The majority of complaints examined by the Commission have shown that, in most cases, double-charging by banks was due to a misapprehension on the part of one of the three banks involved that the transfer was actually a SHARE transfer (shared costs).

When the Commission receives complaints about double-charging for cross-border transfers, it first informs complainants of their rights under Directive 97/5/EC. They are then in a better position to challenge their bank should problems arise. The Commission always tells them how to get in touch with the ombudsmen in the FIN-NET network. Should they fail to obtain satisfaction from their bank, they may have recourse to the out-of-court complaint settlement procedure offered by the FIN-NET network. However, it would seem that complainants are hesitant about embarking on claims procedures for the sake of a few euros.

The Commission naturally has the power to take action in cases where Community legislation has not been or has incorrectly been incorporated into national law or where the national transposal provisions have not been properly applied. However, the information at the Commission's disposal does not suggest that the Directive is being applied incorrectly in a systematic and deliberate manner in any of the Member States.

As indicated in the previous answer, under Regulation (EC) No 2560/2001(1), charges for all cross-border payments in euros must, with effect from 1 July 2003, be the same as those for payments within a Member State, both for the beneficiary and for the sender. The Commission thus intends in the future to amend the legal framework for cross-border transfers to bring it into line with that for domestic transfers.

(1) Parliament and Council Regulation (EC) No 2560/2001 of 19 December 2001 on cross-border payments in euro OJ L 344, 28.12.2001.