Proposal for a REGULATION OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL on establishing a Union programme to support specific activities enhancing the involvement of consumers and other financial services end-users in Union policy making in the field of financial services for the period of 2017-2020
Date: 2016-06-15
Institutions: Directorate-General for Financial Stability, Financial Services and Capital Markets Union, European Commission
Subjects: EU aid, EU policy, EU programme, consumer information, financial services, non-profit organisation

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   EUROPEAN COMMISSION  Brussels, 15.6.2016  COM(2016) 388 final 2016/0182 (COD)   Proposal for a REGULATION OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL on establishing a Union programme to support specific activities enhancing the involvement of consumers and other financial services end-users in Union policy making in the field of financial services for the period of 2017-2020 (Text with EEA relevance) {SWD(2016) 196 final}  
 
EXPLANATORY MEMORANDUM 

1. 

• 

CONTEXT OF THE PROPOSAL 

Reasons for and objectives of the proposal  

In 2007, the confidence of financial services' end-users', and in particular that of consumers in 
the field of financial services, was shaken by the financial and economic crisis. Therefore, the 
European  legislators  considered  that  the  concerns  of  consumers  and  other  financial  services 
end-users  should  be  systematically  and  adequately  taken  into  account  to  restore  citizens' 
confidence in the soundness of the financial sector.  

Financial  services  consumers  cover  a  wide  range  of  natural  persons  using  or  requesting 
financial  services,  including  retail  investors,  savers,  insurance  holders,  pension  fund 
participants  and  borrowers.  While  consumers  represent  the  main  focus  of  the  present 
proposal, its objectives might be also relevant for other end-users of financial services, who 
are  using  or  requesting  financial  services  for  purposes  which  are  not  outside  their  trade, 
business or profession. Several actions have been undertaken by the European Commission to 
ensure  that  the  views  of  consumers  and  other  end-users  of  financial  services  are  heard, 
notably  with  (i)  the  establishment  in  2010  of  the  Financial  Services  Users  Group  (FSUG) 
which  acts  as  a  forum  where  non-industry  stakeholders’  representatives  are  regularly  kept 
informed about the financial services policy issues under development and are invited to give 
their views and express their concerns and suggestions on intended legislative initiatives and 
(ii) the systematic inclusion  of consumers and civil society organisations’  representatives in 
the  various  expert  groups  set  up  to  assist  the  Commission  or  the  ESAs  in  their  work  in  the 
financial services area.  

The Commission had also identified the scarcity of resources and specialised expertise among 
organisations representing these stakeholders as an obstacle to their active participation in the 
discussions  on  the  Union  policy  making  in  the  financial  services  area.  Consumer  bodies  as 
well as civil society organisations did not have adequate resources to properly cover a wide 
range  of  often  highly  technical  topics  and  contribute  relevant  input  in  the  Union  financial 
services  policy  making.  This  was  unsatisfactory  because  the  Commission  could  not  benefit 
from the widest possible range of views and inputs and was perceived by some civil society 
organisations as being unduly influenced by industry contributions. 

In that context, the Commission launched at the end of 2011 a pilot project aiming to provide 
grants  to  support the development of a  financial expertise centre to  the benefit of end-users 
and  non-industry  stakeholders  and  enhance  their  capacity  to  participate  in  Union  policy 
making  in  the  field  of  financial services.  Following  successive  open  calls  for  proposals, the 
Commission  awarded  operating  grants  to  two  non-profit  organisations  based  in  Brussels, 
Finance Watch and Better Finance between 2012 and 2015.  

The two non-profit organisations mainly conducted research work, policy analysis, advocacy 
and  communication  activities  during  that  period.  In  2015,  an  evaluation  of  the  pilot  project 
and the subsequent preparatory action was conducted in order to decide on potential further 
steps in this area.  

The  evaluation  concluded  that  the  policy  objectives  of  the  pilot  project  and  the  preparatory 
action  had  generally  been  met.  However,  the  evaluation  underlined  that  both  organisations 
were  not  financially  sustainable  without  Union  funding,  despite  efforts  to  diversify  their 
resources during these three years. Stopping funding as of 2017 would lead the organisations 
to reduce dramatically or even cease their activities, which would have meant that the policy 
objectives  could  no  longer  be  achieved.  In  the  same  vein,  reducing  the  level  of  co-funding 

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would be risky since both organisations would have to cut staff immediately, already limiting 
their activities in 2017, and likely stop them quite rapidly.  

Co-funding  these  beneficiaries  along  the  same  line  as  of  2017  is  the  only  option  which  can  
ensure  that  all  the  results  and  effects  that  have  materialised  since  2012  according  to  the 
evaluation results are likely to continue. This will enable to further increase the involvement 
of  consumers,  other  end-users  of  financial  services  and  stakeholders  representing  their 
interests in Union policy-making in the financial sector. 

• 

Consistency with existing policy provisions in the policy area 

This  Union  programme  will  complement  existing  policy  initiatives,  such  as  the  activities 
carried  out  by  the  Financial  Services  User  Group  (FSUG)  since  2010,  or  by  other  expert 
groups  set  up  to  assist  the  Commission  or  the  European  Supervisory  Authorities  (e.g  ESAs 
stakeholders groups) in the Union policy making for financial services.  

This Union programme will complement existing Union consumer policy. By contributing to 
a better informed and balanced Union policy making in the financial sector and by providing 
better  communication  to  the  public  around  European  financial  regulation,  this  Programme 
will help restore citizens' confidence in the European financial system. 

2. 

• 

LEGAL BASIS, SUBSIDIARITY AND PROPORTIONALITY 

Legal basis 

The  legal  basis  is  the  Treaty  on  the  Functioning  of  the  European  Union,  and  in  particular 
Article 169(2)(b) thereof. The proposed Union programme will contribute to ensuring a high 
level of protection and to placing consumers at the heart of the single market in the field of 
financial  services,  by  supporting  and  complementing  Member  States'  policies  in  seeking  to 
ensure  that  citizens  can  fully  reap  the  benefits  of  the  internal  market  and  that,  in  so  doing, 
their  legal  and  economic  interests  are  properly  addressed  and  defended.  In  accordance  with 
the  Commission  legislative  policy  adopted  in  the  framework  of  the  Multi-Annual  Financial 
Framework, the present funding programme is proposed as a Regulation. 

• 

Subsidiarity (for non-exclusive competence) 

The Union programme provides for the possibility to co-finance activities carried out by two 
beneficiaries aiming to enhance the involvement of consumers and other end-users, as well as 
stakeholders  representing  their  interests  in  the  field  of  financial  services.  The  proposal 
complies with the subsidiarity principle since, in accordance with Article 5 of the Treaty on 
the European Union, its objectives cannot be sufficiently achieved by the Member States and 
can, by reason of the scale and the effect of the action, be better achieved at Union level. 

In  particular, the evaluation assessed positively the Union added  value of the previous pilot 
project  and  preparatory  action:  national  organisations  dealing  with  all  kinds  of  consumers 
issues lack technical expertise and cannot cover such a broad scope of policy areas related to 
financial services. In addition, no other similar organisations have been identified at EU level. 

• 

Proportionality 

The proposal complies with the proportionality principle as set out in Article 5 of the Treaty 
on the European Union. As assessed in the ex-ante evaluation accompanying the Commission 
proposal for the Financing Regulation, this Regulation does not go beyond what is necessary 
in order to maintain the impacts and effects achieved so far through the previous pilot project 
and preparatory action. Union funding is proposed for two well-identified beneficiaries whose 
activities,  outputs  and impacts have been  evaluated in  2015.  Within  the current  institutional 

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framework, the new funding arrangements will ensure stable, sound and adequate funding to 
achieve  the  policy  objectives.  Financial  support  will  be  granted  according  to  the  conditions 
laid down in Regulation (EU, Euratom) No 966/2012 of the European Parliament and of the 
Council  of  25  October  2012  on  the  financial  rules  applicable  to  the  general  budget  of  the 
Union and Commission Delegated Regulation (EU) No 1268/2012 of 29 October 2012 on the 
rules of application of Regulation (EU, Euratom) No 966/2012. 

• 

Choice of the instrument 

The most appropriate legal instrument to be used in the present case, on the basis of Article 
169(2)(b),  in  order  to  establish  a  Union  programme  to  support  specific  activities  enhancing 
the involvement of consumers and other end-users as well as stakeholders representing their 
interests in Union policy making in the field of financial services, is a regulation.  

3. 

RESULTS 
CONSULTATIONS AND IMPACT ASSESSMENTS 

EX-POST 

EVALUATIONS, 

OF 

STAKEHOLDER 

Ex-post evaluations of existing legislation 

• 
According to the ex-post evaluation1, the Commission considers that the objectives set for the 
pilot project and the subsequent preparatory action has been generally achieved. The overall 
objective  to  develop  a  European  financial  center  of  expertise  has  been  met  with  two 
complementary  centers  of  expertise  having  emerged.  The  activities  implemented  by  both 
beneficiaries  contributed  to  providing  European  policy-makers  with  other  views  than  those 
expressed by the financial industry in that period and by succeeding in communicating those 
views to the wider public. Both Finance Watch and Better Finance have been in close contact 
with Union policy makers since 2012, as evidenced by their participation in various meetings 
and  hearings  in  national  or  European  Parliaments.  Their  expertise,  shared  in  a  number  of 
publications and responses to consultations, enabled them to bring another voice in the public 
debate.  Lastly,  both  developed  effective  communication  capacity  which  enabled  them  to 
inform their members and even a wider public about the issues at stake in the financial sector. 
Finance Watch and Better Finance have been working on different policy areas and targeted 
different audiences, but together they have covered, through their activities, most of the Union 
financial political agenda since 2012.  

Finance Watch was set up thanks to these Union grants, and received €3.04 million financial 
contributions  between  2012  and  2014.  The  assessment  found  that  its  organisation,  staff  and 
activities  are  very  relevant  towards  achieving  the  objectives  of  the  pilot  project  and 
preparatory action. Finance Watch clearly focused on the financial reform agenda following 
the crisis and covered a significant part of the Union political agenda between 2012 and 2014. 
The  expertise  provided  during  that  period  (research  reports,  position  papers,  responses  to 
consultations, press releases) has been generally well-perceived. On the communication side, 
Finance  Watch  set  up  a  dedicated  website,  managed  to  have  a  relatively  strong  media 
presence  and  to  organize  two  high-level  conferences  per  year  since  2012.  The  organisation 
was found less effective in enhancing the capacity of end-users, consumers in Union policy 
making in the financial sector, and this could be linked to its heterogeneous membership (low 
leverage outside Brussels). Its yearly budget amounted to €1.8 million in average, with almost 
two-thirds  of  its  resources  allocated  to  hire  highly  qualified  staff  (14  staff  members)  to 
conduct  its  activities.  The  organisation's  cost-per-output  ratio  (publications,  events  & 
meetings, communication) was assessed as stable between 2012 and 2014.  

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http://ec.europa.eu/finance/finservices-retail/docs/users/151222-staff-working-document_en.pdf 

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Better  Finance  received  €0.90  million  operating  grants  in  three  years.  The  organisation 
managed  to  form  a  financial  centre  of  expertise  focusing  mostly  on  the  interests  of  private 
investors,  individual  shareholders,  savers  and  other  end-users  of  financial  services  in 
coherence  with  its  membership  base  and  limited  resources.  Better  Finance's  organisation, 
members and activities have been assessed as very relevant towards the objectives of the pilot 
project  on  specific  policy  areas.  However,  its  secretariat  was  assessed  as  somewhat  fragile 
with limited size (5 staff members), limited number of financial experts and difficulties faced 
during  that  period  to  keep  stable  resources.  As  regards  its  actual  impact  in  Union  policy-
making,  the  organisation  was  considered  to  be  effective  with  Brussels-based  Union  policy 
makers on a number of  specific  dossiers, and maybe  even  more in  the realm of second and 
third-level legislations with the ESAs. Thanks to the Union operating grants, Better Finance 
could effectively increase its communication potential, developing a professional website and 
hiring dedicated staff. Its research work largely focused on pensions during that period.  

Since  2012,  both  beneficiaries  have  been  funded  up  to  60%  of  their  eligible  costs  through 
Union  grants  and  they remain  heavily  dependent  on  Union funding.  Despite regular  efforts, 
Finance  Watch  managed  to  attract  only  one  other  stable  and  significant  donor,  Adessium 
Foundation,  whose  contribution  is  not  confirmed  after  2016.  Finance  Watch's  members  are 
not  likely  to  compensate  this  loss.  The  situation  appears  even  worse  for  Better  Finance. 
Besides  the  grant,  the  organisation  has  benefited  during  the  period  under  evaluation  (2012-
2014) from a significant and recurrent contribution from one of its members. The important 
reduction of this contribution in 2015 may prove a threat for Better Finance's sustainability. 

Finally, looking at the Union added value brought by this pilot project and preparatory action, 
the  evaluation  concluded  that  both  organisations  definitely  added  value  to  Union  policy 
making in the area of financial services. At the Union level, there are few organisations that 
represent the general interest of consumers, and no civil society organisations that specifically 
focus on the financial sector and its regulation. Between 2012 and 2014, in the context of the 
yearly calls for proposals, no alternative initiative to Finance Watch and Better Finance made 
itself known. The assessment established that both organisations through their actions added 
value with respect to the activities of their national members and benefited to European end-
users in a way that national consumer advocacy groups have not been able to deliver. 

• 

Stakeholder consultations 

The ex-post evaluation included a targeted consultation encompassing a broad on-line survey 
and targeted interviews of all relevant stakeholders: 

–  All members of the beneficiaries (both organisations and individuals) 

–  A  number  of  policy  makers  including  Members  of  the  European  Parliament 
(MEPs  mainly  from  ECON  committee),  COM  officials  (FISMA  and  JUST), 
representatives from the three ESAs and representatives from national authorities  

–  Donors, other funders of the beneficiaries 

–  Consumer organisations  

–  Representatives from the Banking industry 

–  Financial experts 

–  Think tanks involved in the financial sector 

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• 

Impact assessment 

Considering the conclusions of the recent ex-post evaluation on the previous pilot project and 
subsequent preparatory action - including the outputs of the targeted consultation conducted 
in  that  context-  and  also  the  limited  scale  of  the  new  Union  programme,  it  was  decided  to 
accompany the proposal for a legal base by an ex-ante evaluation according to the financial 
regulation. No impact assessment was therefore carried out in that context. 

4. 

BUDGETARY IMPLICATIONS 

The proposed regulation will result in a programme running for the period 2017-2020 with an 
overall maximum budget of EUR 6 000 000 to support the activities carried out by Finance 
Watch  and  Better  Finance.  This  programme  follows  a  pilot  project  (2012-2013)  and  a 
preparatory action (2014-2016). The budgetary implications of this proposal are presented in 
the financial statement in the annex.  

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2016/0182 (COD) 

Proposal for a 

REGULATION OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL 

on establishing a Union programme to support specific activities enhancing the 
involvement of consumers and other financial services end-users in Union policy making 
in the field of financial services for the period of 2017-2020 

(Text with EEA relevance) 

THE EUROPEAN PARLIAMENT AND THE COUNCIL OF THE EUROPEAN UNION, 

Having regard to the Treaty on the Functioning of the European Union, and in particular point 
(b) of Article 169(2) thereof, 

Having regard to the proposal from the European Commission, 

After transmission of the draft legislative act to the national parliaments, 
Having regard to the opinion of the European Economic and Social Committee2, 

Acting in accordance with the ordinary legislative procedure, 

Whereas: 

(1) 

(2) 

(3) 

The Union contributes to ensuring a high level of consumer protection and to placing 
consumers at the heart of the single market by supporting and complementing Member 
States'  policies  in  seeking  to  ensure  that  citizens  can  fully  reap  the  benefits  of  the 
internal  market  and  that,  in  so  doing,  their  legal  and  economic  interests  are  properly 
addressed and defended. A well-functioning and trustworthy financial services sector 
is a key component of the single market. It requires a solid framework for regulation 
and  supervision,  which  simultaneously  ensures  financial  stability  and  focuses  on 
supporting a sustainable economy. At the same time, it should provide a high level of 
protection  to  consumers  and  other  financial  services  end-users,  including  retail 
investors, 
individual 
shareholders, borrowers or SMEs.  

insurance  holders,  pension 

fund  participants, 

savers, 

Since 2007, the confidence of consumers in particular and of other financial services' 
end-users  has  been  shaken  by  the  financial  and  economic  crisis.  To  restore  citizens' 
confidence in the soundness of the financial sector, it is therefore important to increase 
the  involvement  of  consumers  and  other  end-users,  as  well  as  of  stakeholders 
representing  their  interests,  in  the  Union  decision-making  process  in  the  financial 
sector. 

To achieve this objective, the Commission initiated at the end of 2011 a pilot project 
aimed at providing grants to support the development of a financial expertise centre to 
the benefit of consumers, other end-users and stakeholders representing their interests 
and  to  enhance  their  capacity  to  participate  in  Union  policy  making  in  the  field  of 
financial  services.  The  main  policy  objectives  were  to  ensure  that  Union  policy-

2 

OJ C , , p. . 

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(4) 

(5) 

(6) 

(7) 

(8) 

(9) 

makers,  when  initiating  new  legislation,  would  be  provided  with  views  other  than 
those  expressed  by  the  financial  sector  professionals,  that  the  wider  public  is  better 
informed  about  issues  at  stake  in  financial  regulation  and  that  the  participation  of 
consumers,  is  enhanced  in  Union  policy-making  in  the  area  of  financial  services, 
resulting in well-balanced legislation. 

As  a  result,  the  Commission  awarded  between  2012  and  2015  via  an  open  call  for 
proposals  operating  grants  to  two  non-profit  entities,  Finance  Watch  and  Better 
Finance. These grants were awarded under a pilot project during two years, 2012 and 
2013, and a preparatory action since 2014. Since a preparatory action can be used up 
to three years3, a legislative act is necessary to provide a legal basis for funding such 
actions as of 2017.  

Finance  Watch  was  set  up  in  2011  as  an  international  non-profit  association  under 
Belgian  law.  Its  mission  is  to  defend  the  interests  of  civil  society  in  the  financial 
sector.  Thanks to Union grants, Finance Watch in a short period of time managed to 
set  up  a  qualified  team  of  experts,  able  to  conduct  studies,  policy  analysis  and 
communication activities in the field of financial services.  

Better Finance results from successive re-organisations and rebranding of pre-existing 
European  federations  of  investors  and  shareholders  since  2009.  Thanks  to  Union 
grants,  the  organisation  managed  to  form  a  financial  centre  of  expertise,  focusing 
mostly  on  the  interests  of  consumers,  individual  investors,  individual  shareholders, 
savers  and  other  end-users  of  financial  services,  in  coherence  with  its  membership 
base.  

The evaluation of the pilot project and the subsequent preparatory action carried out in 
2015  concluded  that  the  policy  objectives  have  been  generally  achieved.  Finance 
Watch  and  Better  Finance  have  been  working  on  complementary  policy  areas  and 
targeted different audiences. Together they have covered, through their activities, most 
of the Union financial political agenda since 2012.  

Both organisations provided added value both to the sum of activities of their national 
members and  to  Union consumers  in  a way that national consumer advocacy groups 
were  unable  to  deliver.  National  organisations  dealing  with  all  kinds  of  consumers' 
issues lack technical expertise in policy areas related to financial services. In addition, 
no  other  similar  organisations  have  been  identified  at  Union  level  so  far.  The 
evaluation also showed that no other applicant responded to the successive yearly calls 
for  proposal  since  2012,  which  tends  to  show  that  no  other  organisation  is  currently 
able to carry out similar Union-wide activities. 

However,  despite  regular  efforts,  both  organisations  did  not  manage  to  attract  stable 
and  significant  funding  from  other  donors,  independent  from  the  financial  industry, 
and,  therefore,  remain  heavily  dependent  on  Union  funding.  Co-funding  from  the 
Union  is  therefore  necessary  to  ensure  the  resources  needed  to  achieve  the  desired 
policy  objectives  in  the  coming  years,  providing  financial  stability  to  those 
organisations  who have  so far  managed to  start-up their relevant  activities  in  a short 
period of time. It is therefore necessary to establish a Union programme for the period 
the  activities  of  Finance  Watch  and  Better  Finance 
2017-2020 
('Programme'). 

to  support 

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Regulation (EU, Euratom) No 966/2012 of the European Parliament and of the Council of 25 October 
2012  on  the  financial  rules  applicable  to  the  general  budget  of  the  Union  and  repealing  Council 
Regulation (EC, Euratom) No 1605/2002 (OJ L 298 26.10.2012, p. 1). 

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(10)  Continuing  funding  of  Finance  Watch  and  Better  Finance  for  the  period  2017-2020 
along  the  same  lines  as  for  the  preparatory  action  would  ensure  that  the  positive 
impacts  of  the  activities  of  those  organisations  assessed  so  far  are  maintained.  The 
financial  envelope  for the  implementation  of  the  Programme  should  be based  on  the 
average  actual  costs  incurred  by  each  beneficiary  between  2012  and  2015.  The  co-
funding rate should remain unchanged.  

(11)  Between 2012 and 2015, the two organisations have been co-funded through operating 
grants. In 2016, it was decided to provide action grants instead, as action grants ensure 
better control of Union budget spending. 

(12)  This  Regulation  should  lay  down  a  financial  envelope  for  the  entire  duration  of  the 
Programme which is to constitute the prime reference amount, within the meaning of 
point  17  of  the  Interinstitutional  Agreement  of  2  December  2013  between  the 
European  Parliament,  the  Council  and  the  Commission  on  budgetary  discipline,  on 
cooperation  in  budgetary  matters  and  on  sound  financial  management4  for  the 
European Parliament and the Council during the annual budgetary procedure. 

(13) 

In  order  to  ensure  uniform  conditions  for  the  implementation  of  this  Regulation, 
implementing  powers  should  be  conferred  on  the  Commission  in  respect  of  the 
establishment of the annual work programmes.  

(14)  Every  year  before  31  December,  each  beneficiary  should  submit  a  description  of 
activities  planned  for  the  following  year  to  achieve  the  policy  objectives  of  the 
Programme. Those activities should be described in detail, including their objectives, 
expected  results  and  impact,  estimated  costs  and  timeframe  as  well  as  relevant 
indicators to assess them.  

(15)  Financial  support  should  be  granted  in  accordance  with  the  conditions  laid  down  in 
Regulation (EU, Euratom) No 966/2012 and Commission Delegated Regulation (EU) 
No 1268/20125.  

(16)  The  financial  interests  of  the  Union  should  be  protected  through  proportionate 
measures  throughout  the  expenditure  cycle,  including  the  prevention,  detection  and 
investigation of irregularities, the recovery of funds lost, wrongly paid or incorrectly 
used and, where appropriate, administrative and financial penalties.  

(17)  Since the objectives of this Regulation cannot be sufficiently achieved by the Member 
States, but can  rather, by reason of its scale and effects,  be better achieved at Union 
level, the Union may adopt measures, in accordance with the principle of subsidiarity 
as  set  out  in  Article  5  of  the  Treaty  on  the  European  Union.  In  accordance  with  the 
principle  of  proportionality,  as  set  out  in  that  Article,  this  Regulation  does  not  go 
beyond what is necessary in order to achieve those objectives, 

HAVE ADOPTED THIS REGULATION: 

Article 1 
Subject matter and scope 

1. 

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5 

A  Union  programme  (the  ‘Programme’)  is  hereby  established  for  the  period  from 
1 January 2017  to  31  December  2020  to  support  the  activities  of  the  organisations 

OJ C 373, 20.12.2013, p. 1. 
Commission Delegated Regulation (EU) No 1268/2012 of 29 October 2012 on the rules of application 
of  Regulation  (EU,  Euratom)  No 966/2012  of  the  European  Parliament  and  of  the  Council  on  the 
financial rules applicable to the general budget of the Union (OJ L 362 31.12.2012, p. 1). 

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referred to in Article 3, who contribute to the achievement of the policy objectives of 
the Union in relation to enhancing the involvement of consumers and other financial 
services  end-users,  as  well  as  stakeholders  representing  their  interests  in  Union 
policy making in the field of financial services. 

2. 

The Programme shall cover the following activities:  

(a) 

(b) 

(c) 

research activities, including production of own research, data, expertise;  

awareness  and  dissemination  activities,  including  to  a  wide  audience  of  non-
experts;  

activities reinforcing the interactions between the members of the organisations 
referred to in Article 3 and advocacy activities fostering the positions of those 
members at Union level. 

1. 

The Programme shall have the following objectives: 

Article 2 
Objectives 

2. 

1. 

2. 

(a) 

(b) 

to  further enhance the participation of  consumers and other financial services 
end-users, as well as stakeholders representing their interests, in Union policy-
making in the area of financial services;  

to contribute to the information of consumers and other financial services end-
users, as well as stakeholders representing their interests, about issues at stake 
in the regulation of the financial sector. 

The  objectives  set  out  in  paragraph 1  shall  be  monitored  in  particular  through  a 
yearly  description  of  the  actions  performed  by  the  beneficiaries  of  the  Programme 
and  an  annual  activity  report,  which  shall  include  quantitative  and  qualitative 
indicators for each activity planned and conducted by the beneficiaries. 

Article 3 
Beneficiaries 

Finance  Watch  and  Better  Finance  shall  be  beneficiaries  of  the  Programme 
(‘beneficiaries’). 

In  order  to  benefit  from  the  Programme,  these  beneficiaries  shall  remain  non-
governmental,  non-profit-making  legal  entities,  independent  of  industry,  commerce 
or business. They shall have no other conflicting interests and represent through their 
members  the  interests  of  Union  consumers  and  other  end-users  in  the  field  of 
financial  services.  The  Commission  shall  ensure  continued  compliance  with  these 
criteria  for  the  duration  of  the  Programme  by  including  them  in  the  annual  work 
programmes  referred  to  in  Article  7  and  by  assessing  annually  whether  the 
beneficiaries  meet  these  criteria  before  awarding  the  action  grants  referred  to    in 
Article 4.  

3. 

Should  the  two  beneficiaries  referred  to  in  paragraph  1  merge,  the  resulting  legal 
entity shall become the beneficiary of the Programme. 

EN 

10 

   EN 

Article 4 
Award of grants 

Financing  under  the  Programme  shall  be  provided  in  the  form  of  action  grants 
awarded  on  an  annual  basis  and  shall  be  based  on  the  proposals  submitted  by  the 
beneficiaries in accordance with Article 7.  

Article 5 
Transparency 

Any  communication  or  publication  related  to  an  action  made  by  a  beneficiary  and 
funded under the Programme shall indicate that the beneficiary has received funding 
from the budget of the Union. 

Article 6 
Financial provisions 

The financial envelope for the implementation of the Programme for the period from 
1 January 2017 to 31 December 2020 shall be maximum EUR 6 000 000 in current 
prices. 

The  annual  appropriations  shall  be  authorised  by  the  European  Parliament  and  the 
Council within the limits of the multiannual financial framework.  

Article 7 
Implementation of the Programme 

The  Commission  shall  implement  the  Programme  in  accordance  with  Regulation 
(EU, Euratom) No 966/2012. 

In  order  to  benefit  from  the  Programme,  the  beneficiaries  shall  submit  every  year 
before 31 December to the Commission a proposal describing the activities referred 
to in Article 1 planned for the following year. 

In  order  to  implement  the  Programme,  the  Commission  shall  adopt  annual  work 
programmes.  Those  annual  work  programmes  shall  set  out  the  objectives  to  be 
pursued,  the  expected  results  of  the  actions  performed  by  the  beneficiaries,  the 
method of implementation of those actions and the total amount required to perform 
those actions. They shall also contain a description of the actions to be financed, an 
indication  of  the  amount  allocated  to  each  action  and  an  indicative  implementation 
timetable. For the action grants, the annual work programmes shall set out priorities 
and  essential  award  criteria.  The  maximum  rate  of  co-financing  shall  be  60%  of 
eligible costs. 

The  Commission  shall  adopt 
implementing acts. 

the  annual  work  programmes  by  means  of 

Article 8 
Protection of the financial interests of the Union 

The  Commission  shall  take  appropriate  measures  ensuring  that,  when  activities 
financed under this Regulation are implemented, the financial interests of the Union 
are  protected  through  the  application  of  preventive  measures  against  fraud, 
corruption  and  any  other  illegal  activities,  through  effective  checks  and,  if 

1. 

2. 

1. 

2. 

3. 

4. 

1. 

EN 

11 

   EN 

irregularities  are  detected,  through  the  recovery  of  the  amounts  wrongly  paid  and, 
where appropriate, through effective, proportionate and dissuasive administrative and 
financial penalties. 

The  Commission  or  its  representatives  and  the  Court  of  Auditors  shall  have  the 
power  of  audit,  on  the  basis  of  documents  and  on-the-spot  checks,  over  all  grant 
beneficiaries,  contractors  and  subcontractors  who  have,  directly  or  indirectly, 
received Union funds under the Programme.  

The  European  Anti-fraud  Office  (OLAF)  may  carry  out  on-the-spot  checks  and 
inspections on economic operators concerned directly or indirectly by such funding 
in  accordance  with  the  procedures  laid  down  in  Regulation  (EU,  Euratom) 
No 883/2013  of  the  European  Parliament  and  of  the  Council6  and  in  Council 
Regulation (Euratom, EC) No 2185/967 with a view to establishing whether there has 
been fraud, corruption or any other illegal activity affecting the financial interests of 
the  Union  in  connection  with  a  grant  agreement  or  grant  decision  or  a  contract 
funded, directly or indirectly, under this Programme. 

Without  prejudice  to  paragraphs  1,  2  and  3,  cooperation  agreements  with  third 
countries  and  international  organisations  and  grant  agreements  and  grant  decisions 
and  contracts  resulting  from  the  implementation  of  this  Regulation  shall  expressly 
empower the Commission, the Court of Auditors and OLAF to conduct such audits, 
on-the-spot  checks  and  inspections.  Where  the  implementation  of  an  action  is 
outsourced or subdelegated, in whole or in part, or where it requires the award of a 
procurement  contract  or  financial  support  to  be  given  to  a  third  party,  the  grant 
agreement  or  decision  shall  include  the  beneficiary's  obligation  to  impose  on  any 
third  party  involved  explicit  acceptance  of  those  powers  of  the  Commission,  the 
Court of Auditors and OLAF. 

Article 9 
Evaluation 

No later than twelve months before the end of the Programme, the Commission shall 
submit  to  the  European  Parliament  and  the  Council  an  evaluation  report  on  the 
achievement  of  the  Programme's  objectives.  That  report  shall  appraise  the  overall 
relevance and added value of the Programme, the effectiveness and efficiency of its 
execution  and  the  overall  and  individual  effectiveness  of  the  beneficiaries' 
performance in terms of achievements of the objectives set out in Article 2. 

The report shall be forwarded to the European Economic and Social Committee for 
information. 

Regulation  (EU,  Euratom)  No  883/2013  of  the  European  Parliament  and  of  the  Council  of 
11 September  2013  concerning  investigations  conducted  by  the  European  Anti-Fraud  Office  (OLAF) 
and  repealing  Regulation  (EC)  No  1073/1999  of  the  European  Parliament  and  of  the  Council  and 
Council Regulation (Euratom) No 1074/1999 (OJ L 248, 18.9.2013, p. 1). 
Council  Regulation  (Euratom,  EC)  No  2185/96  of  11  November  1996  concerning  on-the-spot  checks 
and inspections carried out by the Commission in order to protect the European Communities’ financial 
interests against fraud and other irregularities (OJ L 292, 15.11.1996, p. 2). 

2. 

3. 

4. 

1. 

2. 

6 

7 

EN 

12 

   EN 

                                                 
Article 10 
Entry into force 

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

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

Done at Brussels, 

For the European Parliament 
The President 

For the Council 
The President 

EN 

13 

   EN 

LEGISLATIVE FINANCIAL STATEMENT 

1. 

FRAMEWORK OF THE PROPOSAL/INITIATIVE 

1.1. 

Title of the proposal/initiative  

Proposal  for  a  Regulation  of  the  European  Parliament  and  of  the  Council  on 
establishing  a  Union  programme  to  support  specific  activities  enhancing  the 
involvement  of  consumers  and  other  financial  services  end-users  in  Union  policy-
making in the field of financial services for the period of 2017-2020. 
Policy area(s) concerned in the ABM/ABB structure8  

1.2. 

Policy Area: 12.02 Financial services and capital markets  

Activity: Financial services and capital markets  

1.3. 

Nature of the proposal/initiative  

 The proposal/initiative relates to a new action  

X  The  proposal/initiative  relates  to  a  new  action  following  a  pilot  project/preparatory 
action9  

 The proposal/initiative relates to the extension of an existing action  

 The proposal/initiative relates to an action redirected towards a new action  

1.4. 

Objectives 

1.4.1.  The  Commission's  multiannual 

strategic  objective(s) 

targeted  by 

the 

proposal/initiative  

Support  activities  which  aim  to  enhance  the  involvement  of  consumers  and  other 
end-users in Union policy making in the field of financial services 

1.4.2. 

Specific objective(s) and ABM/ABB activity(ies) concerned  

Specific objectives:  

Further enhance the involvement of consumers and other end-users, as well as other 
stakeholders  representing  their  interests,  in  Union  policy  making  in  the  financial 
services 

Contribute  to  the  information  of  consumers  and  other  end-users,  as  well  as 
stakeholders representing their interests, about issues at stake in the regulation of the 
financial sector 

ABM/ABB activity(ies) concerned:  

12. Financial services and capital markets 

8 
9 

ABM: Activity-Based Management – ABB: Activity-Based Budgeting. 
As referred to in Article 49(6)(a) or (b) of the Financial Regulation. 

EN 

14 

   EN 

 
                                                 
1.4.3.  Expected result(s) and impact 

Specify the effects which the proposal/initiative should have on the beneficiaries/groups targeted. 

The  impacts  assessed  by  the  ex-post  evaluation  of  the  pilot  project  and  the 
preparatory action are expected to be maintained: 

-strengthen  the  voice  of  consumers  and  other  end-users  in  the  European  financial 
regulation, thereby ensuring a well-balanced Union legislation  

-develop a strong communication device with European end-users   

1.4.4. 

Indicators of results and impact  

Specify the indicators for monitoring implementation of the proposal/initiative. 

Indicators for the research activities: quantitate and qualitative indicators such as: 
- number and type of research activities; topics covered; 
- dissemination strategy; 
- peer reviews 

Indicators  for  the  awareness  and  dissemination  activities:  quantitate  and  qualitative 
indicators such as: 
-  number  and  type  of  public  event  organised  (e.g.  high-level  conferences);  topic 
covered; evaluation of the event by participants; 
- traffic through the website, including from members; 
- all relevant quantitative indicators for social media; 
- press coverage including number of interviews and broadcasts; topics covered 

Indicators for the advocacy activities fostering interactions and positions of members 
of Finance Watch and Better Finance : quantitate and qualitative indicators such as: 
- number of meetings with EU policy-makers, participation in hearings; 
-  coordination  with  members  of  Finance  Watch  and  Better  Finance,  contributions 
received, working groups set with members 

1.5. 

Grounds for the proposal/initiative  

1.5.1.  Requirement(s) to be met in the short or long term  

A pilot project and a preparatory action can be used only during a limited period of 
time. To ensure that the results obtained and impacts assessed so far are maintained, 
the  only  way  forward  is  a  legislative  framework  providing  for  funding  the  same 
activities. 

EN 

15 

   EN 

 
 
 
 
 
 
 
1.5.2.  Added value of EU involvement 

The  ex-post  evaluation  assessed  positively  the  Union  added  value  of  the  previous 
pilot project and preparatory action: national organisations dealing with all kinds of 
consumers  issues  lack  technical  expertise  and  cannot  cover  such  a  broad  scope  of 
policy areas related to financial services. In addition, no other similar organisations 
have  been  identified  at  Union  level.  The  proposal  complies  with  the  subsidiarity 
principle since, in accordance with Article 5 of the Treaty on the European Union, its 
objectives cannot be sufficiently achieved by the Member States and can, by reason 
of the scale and the effect of the action, be better achieved at Union level. 

1.5.3.  Lessons learned from similar experiences in the past 

The ex-post evaluation of the previous pilot project and preparatory action assessed 
that the policy objectives set at the end of 2011 have been overall achieved. 

To  ensure  that  the  positive  impacts  assessed  so  far  are  maintained,  it  is  therefore 
necessary to continue funding the same activities along the same lines. 

1.5.4.  Coherence and possible synergy with other relevant instruments 

This  Union  programme  will  complement  existing  policy  initiatives,  such  as  the 
activities carried out by the Financial Services User Group (FSUG) since 2010, or by 
other  expert  groups  set  up  to  assist  the  Commission  or  the  ESAs  (e.g.  ESAs 
stakeholders groups) in the Union policy making for financial services.  

This  Union  programme  will  complement  existing  Union  consumer  policy.  By 
contributing  to  a  stronger  involvement  of  consumers  and  other  end-users  in  Union 
policy making in the financial sector and by providing better communication to the 
public around these issues, this Programme will enable to better represent and voice 
the interests of consumers and other end-users in this area, thereby restoring citizens' 
confidence in the European financial system. 

1.6. 

Duration and financial impact  

X Proposal/initiative of limited duration  

–  X  Proposal/initiative in effect from 01/01/2017 to 31/12/2020  

–  X  Financial impact from 2017 to 2021  

 Proposal/initiative of unlimited duration 

–  Implementation with a start-up period from YYYY to YYYY, 

–  followed by full-scale operation. 
1.7.  Management mode(s) planned10  

X Direct management by the Commission 

–  X by its departments, including by its staff in the Union delegations;  

–    by the executive agencies  

 Shared management with the Member States  

 Indirect management by entrusting budget implementation tasks to: 

10 

Details  of  management  modes  and  references  to  the  Financial  Regulation  may  be  found  on  the 
BudgWeb site: 
https://myintracomm.ec.europa.eu/budgweb/EN/man/budgmanag/Pages/budgmanag.aspx  

EN 

16 

   EN 

                                                 
–   third countries or the bodies they have designated; 

–   international organisations and their agencies (to be specified); 

–  the EIB and the European Investment Fund; 

–   bodies referred to in Articles 208 and 209 of the Financial Regulation; 

–   public law bodies; 

–   bodies governed by private law with a public service mission to the extent that 

they provide adequate financial guarantees; 

–   bodies governed by the private law of a Member State that are entrusted with 
the  implementation  of  a  public-private  partnership  and  that  provide  adequate 
financial guarantees; 

–    persons  entrusted  with  the  implementation  of  specific  actions  in  the  CFSP 

pursuant to Title V of the TEU, and identified in the relevant basic act. 

– 

If more than one management mode is indicated, please provide details in the ‘Comments’ section. 

2. 

MANAGEMENT MEASURES  

2.1.  Monitoring and reporting rules  

Specify frequency and conditions. 

For both beneficiaries : progress reports and final reports 

2.2.  Management and control system  

2.2.1.  Risk(s) identified  

There  is  a  risk  of  not  achieving  the  operational  objectives  if  the  quality  of  the 
beneficiaries'  output  is  not  in  accordance  with  the  initial  objectives  as  described  in 
the annual proposals 

There  is  a  risk  of  threat  to  the  EU  financial  interests/reputation  if  Commission's 
services fail to identify ineligible expenditure 

2.2.2. 

Information concerning the internal control system set up 

Risk of not achieving operational objectives: 

–  Beneficiaries  are  requested  to  submit  an  annual  report,  in  accordance  with  the 
individual  objectives  of  annual  proposals  and  in  line  with  the  guidelines  of 
Regulation (EU,  Euratom)  No 966/2012  of 25  October 2012, on the financial  rules 
applicable to the general budget of the European Union 

– The operational units responsible within DG FISMA have regular contacts with the 
beneficiaries  

Risk of threat to the EU financial interests: 

– Controls of grant commitments and payments in DG FISMA follow the reinforced 
financial  circuit  and  comprise  desk  checks  of  relevant  supporting  documents, 
including  interim  and  final  reports,  audited  accounts  and  specific  documents 
requested  by  the  DG.  These  controls  are  documented  in  checklists  that  are 
systematically filled in by all actors involved in the respective financial transactions 
(OIA,OVA,OVA2,FIA,  FVA,  FVA2,  AO),  including  controls  carried  out  by  the 

EN 

17 

   EN 

DG's  financial  unit  on  financial  and  legal  matters  in  order  to  deliver  the  "Bon  à 
Payer" 

–  The  DG's  financial  unit  systematically  carries  out  on-the-spot  controls  on  each 
beneficiary with substantive testing of a sample of transactions with an aim to assess 
the  beneficiary's  financial  and  internal  control  system  and  to  provide  the  AO  with 
additional assurance on the sufficient protection of the EU financial interests 

2.2.3.  Estimate of the costs and benefits of the controls and assessment of the expected level 

of risk of error  

The maximum error rate would remain below 2% 

The cost of the controls would be below 0.5 FTE or 67.000€ per year. 

The  benefit  of  the  controls  would  be  100%  of  the  annual  granted  amount  spent 
adequately and following the sound financial management principle  

2.3.  Measures to prevent fraud and irregularities  

Specify existing or envisaged prevention and protection measures. 

Reinforced  financial  circuits  with  both  an  ex-ante  operational  and  financial 
verification  

Regular analysis of the beneficiaries' accounts, annual reports and audit certificates  

On-the-spot regular audits to verify financial systems and controls 

EN 

18 

   EN 

3. 

ESTIMATED FINANCIAL IMPACT OF THE PROPOSAL/INITIATIVE  

3.1. 

Heading(s) of the multiannual financial framework and expenditure budget line(s) affected  

  Existing expenditure budget lines: not applicable 

  New budget lines requested  

In order of multiannual financial framework headings and budget lines. 

Budget line 

Type of 
expenditure 

Contribution  

Heading of 
multiannual 
financial 
framework 

12.0202  
the 
Enhancing 
of 
involvement 
consumers 
and 
other  end-users  in 
policy 
Union 
making  in  the  field 
of 
financial 
services.… 

Diff./Non-diff. 

from 
EFTA 
countries 

from 
candidate 
countries 

from third 
countries 

within the 
meaning of 
Article 21(2)(b
) of the 
Financial 
Regulation  

1 

12.02.02 

Diff 

NO 

NO 

NO 

NO 

EN 

19 

EN 

 
  
 
 
 
3.2. 

Estimated impact on expenditure  

3.2.1. 

Summary of estimated impact on expenditure  

Heading of multiannual 
financial framework:  

Number:1 

Heading Smart and Inclusive Growth 

DG: FISMA 

2017 

2018 

2019 

2020 

2021 

TOTAL 

 Operational appropriations  

12.0202  

Commitments 

Payments 

(1) 

(2) 

1.500 
0750 

1.500 
1.500 

1.500 
1.500 

1.500 
1.500 

0.750 

6.000 
6.000 

EUR million in current prices (to 3 decimal places) 

Appropriations  of  an  administrative  nature 
specific 
financed 
from 
programmes11  
Number of budget line 

the  envelope  of 

(3) 

TOTAL appropriations 
for DG FISMA 

Commitments 

Payments 

=1+1a 
+3 

=2+2a 

+3 

0 

0 

0 

0 

0 

0 

1.500 

1.500 

1.500 

1.500 

6.000 

0.750 

1.500 

1.500 

1.500 

0.750 

6.000 

11 

EN 

Technical and/or administrative assistance and expenditure in support of the implementation of EU programmes and/or actions (former ‘BA’ lines), indirect research, direct 
research. 

20 

EN 

 
  
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
                                                 
 TOTAL operational appropriations  

Commitments 

Payments 

  TOTAL  appropriations  of  an  administrative  nature 
financed from the envelope for specific programmes  

TOTAL appropriations  
under HEADING 1 
of the multiannual financial framework 

Commitments 

Payments 

(4) 

(5) 

(6) 

=4+ 
6 

=5+ 
6 

1.500 

1.500 

1.500 

1.500 

6.000 

0.750 

1.500 

1.500 

1.500 

0.750 

6.000 

0 

0 

0 

0 

0 

0 

1.500 

1.500 

1.500 

1.500 

6.000 

0.750 

1.500 

1.500 

1.500 

0.750 

6.000 

If more than one heading is affected by the proposal / initiative: not applicable 

 TOTAL operational appropriations  

Commitments 

Payments 

  TOTAL  appropriations  of  an  administrative  nature 
financed from the envelope for specific programmes  

(4) 

(5) 

(6) 

1.500 

0.750 

1.500 

1.500 

1.500 

1.500 

1.500 

1.500 

0.750 

6.000 

6.000 

TOTAL appropriations  
under HEADINGS 1 to 4 
of the multiannual financial framework 
(Reference amount) 

Commitments 

=4+ 6 

1.500 

1.500 

1.500 

1.500 

6.000 

Payments 

=5+ 6 

0.750 

1.500 

1.500 

1.500 

0.750 

6.000 

TOTAL appropriations  
under HEADINGS 1 to 5 
of the multiannual financial framework  

Commitments 

1.500 

1.500 

1.500 

1.500 

6.000 

Payments 

0.750 

1.500 

1.500 

1.500 

0.750 

6.000 

2017
12 

2018 

2019 

2020 

2021 

TOTAL 

12 

Year N is the year in which implementation of the proposal/initiative starts. 

EUR million (to three decimal places) 

EN 

21 

EN 

 
  
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
                                                 
3.2.2.  Estimated impact on operational appropriations  

–    The proposal/initiative does not require the use of operational appropriations  

–  X  The  proposal/initiative  requires  the  use  of  operational  appropriations,  as 

explained below: (action grants) 

3.2.3.  Estimated impact on appropriations of an administrative nature 

3.2.3.1.  Summary  

–  X  The  proposal/initiative  does  not 

require 

the  use  of  administrative 

appropriations  

–   The  proposal/initiative  requires  the  use  of  administrative  appropriations,  as 

explained below: 

3.2.3.2.  Estimated requirements of human resources 

–  X  The proposal/initiative does not require the use of human resources  

–    The  proposal/initiative  requires  the  use  of  human  resources,  as  explained 

below: 

The human resources required will be met by staff from the DG who are already assigned to 
management of the action. 

3.2.4.  Compatibility with the multiannual financial framework  

–  X  Proposal/initiative  is  compatible  with  the  proposal  for  the  new  multiannual 

financial framework 2014-2020  

–    Proposal/initiative  will  entail  reprogramming  of  the  relevant  heading  in  the 

multiannual financial framework. 

Explain what reprogramming is required, specifying the budget lines concerned and the corresponding 
amounts. 

–    Proposal/initiative requires application of the flexibility instrument or revision 

of the multiannual financial framework13. 

 See section 3.2.1.. 

3.2.5.  Third-party contributions  

–  The proposal/initiative does not provide for co-financing by third parties  

–  The proposal/initiative provides for the co-financing estimated below: 

Finance Watch and Better Finance with their own funds 
and with funds received from third parties 
(Beneficiary average co-finance 40%) 

Appropriations in EUR million (to 3 decimal places) 

2017 

2018 

2019 

2020 

Total 

1.000 

1.000 

1.000 

1.000 

4.000 

TOTAL appropriations co-financed  

1.000 

1.000 

1.000 

1.000 

4.000 

13 

See points 19 and 24 of the Interinstitutional Agreement. 

EN 

22 

   EN 

 
 
 
 
 
 
 
 
                                                 
3.3. 

Estimated impact on revenue  

–  X  Proposal/initiative has no financial impact on revenue. 

–    Proposal/initiative has the following financial impact: 

– 

– 

 

 

on own resources  

on miscellaneous revenue  

EN 

23 

   EN