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A regular update
on key EU policy developments
Issue 28 September 2016
Brexit and beyond
The legislative pipeline for financial services, energy and digital
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Where do we go from here?
Financial Services 5
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Digital
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Brexit
Where do
we go from here?
Few material changes have taken place in Brussels or London since 52% of Brits voted to leave the European Union on
23 June. But behind the scenes, perceptions are shifting and
a world of uncertainty lies ahead of us. It has become clear
that the political leadership that raised the Brexit question did
not plan for the eventuality of the vote to leave the EU. The
complacency of David Camerons government is all the more
surprising given that, in the informed judgement of the European Union Committee of the House of Lords, withdrawal
from the EU is arguably the most complex, demanding and
important administrative and diplomatic task that the Government has undertaken since the Second World War. The
select committee is now quite rightly pushing for Parliament
will be replaced, subject to European Parliament endorsement expected in September, by Sir Julian King, the former
Leonardo Sforza
Managing Director, Head of
EU Affairs
Financial Services
Proposals to be Adopted
> Revised directive on Institutions for
Occupational Retirement Provision (IORP II)
The proposed revision of the IORP II directive was presented
by the European Commission in March 2014, mainly focusing on the governance and transparency of the activities of
occupational pension institutions.
According to the rapporteur in the European Parliament,
Brian Hayes (EPP, Ireland), the final text will be voted on at
the plenary session in October 2016. EU member states will
have 24 months after the entry into force of the Directive to
transpose it into national legislation.
Timeline
March 2014: Commission proposal
30 June 2016: Council Agreement
October 2016: Adoption in EP Plenary
2018:
Ongoing consultations
> Capital Markets Union: action on a potential
EU personal pension framework
27 July - 31 October
The consultation invites interested parties to provide
information on their experience using personal pension schemes and seeks the views of professionals
working in the pensions industry on the possibility
of offering more simple, affordable and transparent
personal pension products. The consultation will
enable the Commission to get a better view on what
can be done at EU level to support a wider choice of
personal benefit tools at retirement across borders.
Timeline
September 2015: Commission proposal
December 2015: Council agreement
Timeline
November 2015: Commission proposal
17 June 2016 : negotiating mandate agreed at ECO
FIN Council
13 September 2016: negotiating mandate agreed in
EP plenary
Autumn 2016: start of inter-institutional
negotiations
End 2016: target date from Slovak Presidency
for Political agreement
2017: Entry into force of Regulation
2018: Application of Regulation and dead
line for transposition of elements in
national law
The commission adopted a proposal for a regulatory framework for Money Market Funds (MMFs) in September 2013.
These funds serve as an important source of short-term financing for financial institutions, business and governments,
but are also vulnerable to investor runs on redemptions
and have given rise to the misperception that their returns
are guaranteed. The proposed regulatory framework should
allow them to better withstand redemption pressures in
stressed market conditions, while ensuring that they remain
a secure tool for European companies to manage their finances.
After years of discussion, on 17 June 2016 the EU finance
Timeline
September 2013: Legislative Proposal published
April 2015: negotiating mandate agreed in
EP plenary
May 2015: Opening inter-institutional
negotiations
June 2016: Council position
Autumn 2016 : expected start of the Trilogue
negotiations
End 2016: target Slovak Presidency for political
agreement Council European
Parliament
seeks to abolish the practice of member states levying charges when a fund is registered. Also the definition of SME in
which a fund must invest 70% of the capital subscribed in
order to obtain the European Passport is relaxed. The proposal will now be submitted to the European Parliament and
the Council. The first meeting of the Member States on the
topic of tax incentives for venture capital and business angels
is scheduled for Autumn 2016, to allow for an exchange of
views on best practices, on the basis of a study launched by
the Commission in January.
Financial
Services
Timeline
2016
Q3
Q4
Banking
Union
PROPOSAL ON REDUCTION
OF FINANCIAL RISKS *
FTT
DIRECTIVE ON IORP II
Council exploring
possible use of
Intergovernmental
Agreement
REGULATION ON
PROSPECTUS
PROPOSAL ON COMMON
CONSOLIDATED TAX BASE*
Possible
Agreement
Council
agreement
Adoption
EP
Committee
Position
Council
Position
Council
Position
Trilogue
negotations
EP
Plenary
Position
Adoption
EP
Trilogue
Adoption
Position negotations
Results Public
Consultation
Q3
Q4
Council
Position
EP Plenary
Position
Implementation
Implementation
Trilogue negotations
Implementation
Implementation
EP
Committee
Position
Commission
proposal
REGULATION amending
EuVECA and EuSEF
REGULATIONS
Commission
proposal
PROPOSAL ON
EU MACRO PRUDENTIAL
FRAMEWORK *
Public
consultation
Results
Potential
Commission
proposal
PROPOSAL ON
EU PERSONAL PENSION
FRAMEWORK *
Public
consultation
Results
Potential
Commission
proposal
PROPOSAL ON CROSS
BORDER DISTRIBUTION OF
INVESTMENT FUNDS *
Public
consultation
Results
Potential
Commission
proposal
EVALUATION FINANCIAL
CONGLOMERATE DIRECTIVE
Public
consultation
Results
Potential
Commission
proposal
Q2
EP
Committee
Position
Adoption
Setting up 2
Ministrial Working
Groups
REGULATION ON STS
SECURISATION FRAMEWORK
REGULATION ON REFORM OF
MONEY MARKET FUNDS
Q1
Commission
proposal
REGULATION ON EUROPEAN
DEPOSIT INSURANCE
SCHEME (EDIS)
FINANCIAL TRANSACTION
TAX (enhanced cooperation)
2017
EP
Committee
Position
Council
Position
Council
Position
EP Plenary
Position
EP Plenary
Position
Trilogue
negotations
Energy
Towards a redesigned
European energy
framework
In the coming months, the European Commission will present several major legislative proposals for the energy sector,
in order to give life to its five-pillar energy strategy presented in 2015: realize an integrated internal energy market,
reduce Europes climate impact, improve energy efficiency,
strengthen security of supply and support innovation. To
fulfil these goals, the EU institutions will work on revising
the Emission Trading System, as well as the existing energy
efficiency and renewable energy directives. The EU legislators will also focus on a new set of measures for Europes security of supply, focusing on intergovernmental agreements
for gas companies and on a heating and cooling strategy, as
well as on liquefied natural gas. Key future policy developments are outlined below.
The uncertainty thrown up by Brexit is reflected in the fact
that private investors will likely hold back on large energy
projects until they have assurances about the environment
they will be operating in. By way of example, the UK has
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already seen a 20% decline in value of infrastructure contracts for July compared with the previous month. Leaving
the single market could also open the UK to new import
taxes, adding cost to equipment such as foundations for
offshore wind farms or parts for nuclear plants. There are
some silver linings for the UK energy sector though. Brexit would eliminate the EUs trade duties on Chinese solar
equipment imports, making cheap panels more accessible
to UK users. The UK unshackling itself from Brussels might
also mean companies and investors are granted more freedom to access local public subsidies, or pursue energy projects such as for shale gas which are currently submitted to
EU environmental assessment. Meanwhile, in the legislative landscape, the Commissions climate policy - the blueprint for sharing out the 40% by 2030 greenhouse gas target
among the 28 member states is now likely to be postponed,
along with inter-institutional negotiations on the emissions
trading system.
Timeline
September: adoption of the EP own-initiative report
End 2016 : Directive proposal by the Commission
Early 2017: Expected EP Committee position
Mid 2017: Expected Council position
End 2017: Expected formal adoption
Timeline
September: Publication of the results of the renewable
energy directive consultation.
End 2016 : Renewable Energy Package proposal by
the Commission
Early 2017: Expected EP Committee position
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Climate action
> Directive on EU Emissions Trading System
The European Parliament and the Council of the EU are currently discussing a proposal presented in July 2015 by the
Commission to revise the EU Emissions Trading system for
the period after 2020. The proposal intends to increase the
pace of emissions cuts after 2020 by reducing the overall
number of emission allowances at an annual rate of 2.2%
from 2021 onwards, instead of 1.74% currently. This shall
result in an automatic increase of carbon costs, impacting
energy intensive industries in particular.
to achieve energy savings. However, participants indicated that the present framework remains complex, and that
Member States require additional guidance.
On 23 June, the Parliament adopted a resolution on energy
efficiency. It stresses the need for the full implementation
of the existing EU legislation for the EU to meet its energy
efficiency target by 2020 (an increase of 20% by 2020), while
calling for a binding target of at least 30% of renewables in
the EU energy mix by 2030. This recommendation will feed
into the legislative proposal that the Commission is expected to present this autumn.
Timeline
Autumn:
The Environment (ENVI) and Industry, Research and Energy (ITRE) committees, both in charge of this dossier, will
discuss the amendments on the draft report from September
for a vote expected in October (ITRE) and December 2016
(ENVI).
Timeline
September: Consideration of amendments in the
environment and industry committees
of the Parliament.
October :
End 2017:
Expected adoption
Energy efficiency
> Directive on Energy Efficiency
In 2016 the Commission intends to reap the full potential of
energy efficiency by putting forward a new energy efficiency directive. The proposal, to be presented at the end of the
year, will align the regulatory framework to the indicative
EU-level target of at least 27% energy efficiency by 2030.
It will also include provisions for large companies to carry
out regular energy audits. Without waiting for the proposal to be presented, the European Commission has already
announced that it will be reviewed a second time by 2020
with the objective of upping the EU target to 30% energy
efficiency by 2030.
The results of a public consultation on this issue held by
the Commission at the beginning of 2016 show that stakeholders agree that the energy efficiency directive of 2012
established a comprehensive framework for the EU. The
majority also believes that the Energy Efficiency Obligation
Schemes set by the directive are an effective instrument
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Timeline
End 2016:
Council position
2018:
Security of Supply
On the 16 of February, the European Commission presented
its Winter Package, also known as the Security of Gas
Supply Package. It contains several measures aimed at improving the resilience of the EU to breaks in gas supply, as
certain countries and regions of the European neighbourhood remain instable, for example Ukraine. Two legislative
proposals, as well as two strategies for Liquefied Natural
Gas (LNG) and for heating and cooling, are part of this strategy.
Timeline
End 2016: Slovak presidency to encourage preliminary
Trilogue negotiations.
Early 2017: Expected EP position
Mid 2017: Expected Council position
End 2017: Expected adoption of both legislative
proposals.
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Energy
Internal Energy
Market
2016
Timeline
2017
Q3
Q4
DIRECTIVE FOR AN
ELECTRICITY MARKET
DESIGN
EP Committee
preliminary position
Commission
Proposal
EP Committee
Position
Council
Position
EP Plenary
Position
Trilogue
negotiations
Adoption
DIRECTIVE ON RENEWABLE
ENERGY
Consultation results
Commission
Proposal
EP Committee
Position
Council
Position
EP Plenary
Position
Trilogue
negotiations
Adoption
EP Committee
Position
Council
Position
EP Plenary
Position
Trilogue
negotiations
Adoption
Energy efficiency
& climate
Supply
Security
LEGISLATIVE PROPOSAL
ON BIOENERGY
SUSTAINABILITY
REGULATION ON SECURITY
OF GAS SUPPLY
DIRECTIVE ON ENERGY
LABELLING
DECISION ON IGAS
Q1
Commission
Proposal
EP Committee
Position
Council
Position
EP Plenary
Position
EP Plenary
Position
Council
Position
Adoption
EP Committee
Position
Trilogue
negotiations
Preliminary inter-institutional
negotiations
EP Committee
Position
Q2
Trilogue
negotiations
Commission
Proposal
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Ongoing consultations
Adoption
EP Committee
Position
Council
Position
Council
Position
Council
Position
EP Plenary
Position
Q3
Q4
National transposition
EP Plenary
Position
Trilogue
negotiations
Adoption
National transposition
EP Plenary
Position
Trilogue
negotiations
Adoption
Adoption
Digital
Towards a Digital
Single Market by
end of 2017
In the second half of 2016, the European institutions will
enter the final stretch; releasing, adopting or making significant progress in the negotiations over the remaining legislative proposals completing the Digital Single Market. While
some major proposals, such as the Regulation on geoblocking or the cross-border portability of online content, are
about to enter the decisive phase of trilogue negotiations,
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the European Commission will also present its long-awaited proposal on copyright reform in September, adapting
intellectual property rules to the ever-evolving online environment. European stakeholders are expected to actively
contribute to the debate given the many financial, legal and
cultural interests at stake.
a Regulation to allow cross-border portability of online content services in December last year. In practice, the Regulation will enable consumers with subscriptions to online
content to access it when they are temporarily in another
EU country.
The European Parliament and the Council of Ministers already adopted their position on the proposal and will start
inter-institutional negotiations in September with a view
to reaching an agreement by the end of the year. The negotiations are not expected to be difficult, as the European
Parliament and the Council share the same approach on the
sensitive notion of temporary presence in another Member State. Some Members of the European Parliament advocated for a strict definition to a certain number of days, but
both the Parliament and the Council agreed to not define
the notion of temporary period abroad and call for compulsory and effective controls. They also both propose a strict
definition of the country of residence and call on service
providers to carry out checks on the basis of a range of criteria, such as the invoice address, bank account, payment
of local taxes or samples of the IP address. They eventually
explain that the new obligations applicable to service providers should not lead to increased administration costs and
that the principle of territoriality must continue to prevail.
Timeline
September: start of the Trilogue negotiations
End 2016 : expected agreement on the decision
Early 2017: expected formal adoption of the decision
Mid 2017: expected start for the implementation of
the regulation
Timeline
November: expected Council position on the proposal
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Timeline
Early 2017 : expected Parliament and Council positions
on the proposal
Spring 2017: expected start of the Trilogue negotiations
Timeline
Mid 2017:
Fall 2017:
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Timeline
September: start of the Trilogue negotiations
End 2016 : expected agreement on the decision
Early 2017: expected formal adoption of the decision
2022:
2030:
Timeline
Early 2017: expected Parliament and Council positions
on the proposal
Spring 2017: expected start of the Trilogue negotiations
Mid 2017:
Fall 2017:
2019:
Timeline
The European Parliament and the Council of the European Union are just starting to develop their internal position
before entering into inter-institutional negotiations. Within
the European Parliament, the file has been assigned to the
Committee on Transport and Tourism (TRAN) and the appointment of a rapporteur is pending. The 28 responsible
EU Ministers will discuss the proposal at their next Telecom
Council meeting on 2 December.
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The European Commission completed two public consultations last year on broadband needs and the review of the
current telecoms framework. It covered all three main pillars
of the current framework, namely the network pillar, with
the aim of ensuring a consistent regulatory framework that
is supportive of infrastructure investments in both fixed and
wireless networks; the service pillar, with the aim of ensuring a modernised regulatory regime for electronic communication services and the governance pillar, with the aim of
ensuring that markets are regulated in a consistent manner
across the EU.
The revision of the telecoms package may be the last legislative item out of an agenda of 16 identified actions in the
Commission Digital Single Market strategy. Its adoption is
not expected before the end of 2017.
Timeline
November: expected Commission proposal
Mid 2017: expected Parliament and Council positions
on the proposal
Fall 2017:
Digital
Single Market
Timeline
Cross-Border E-commerce
2016
Q3
Q4
EP Committee
Position
PROPOSAL TO REFORM
THE COPYRIGHT REGIME
Commission
Proposal
Trilogue
negotiations
DIRECTIVE ON
AUDIOVISUAL MEDIA
SERVICES DIRECTIVE
DECISION ON THE
700MHZ BAND
Council
Position
Q1
EP Plenary
Position
Trilogue
negotiations
Q2
Trilogue
negotiations
Council
Position
Adoption
Q4
Implementation
EP Plenary
Position
Trilogue
negotiations
Adoption
Implementation
Council
Position
EP Plenary
Position
Trilogue
negotiations
Adoption
EP Committee
Position
Q3
Adoption
EP Committee
Position
EP Committee
Position
19
2017
Council
Position
National
Transposition
Adoption
Implementation
EP Plenary
Position
Trilogue
negotiations
Adoption
Implementation
PROPOSALS TO REVIEW
THE TELECOM PACKAGE
Commission
Proposal
EP Committee
Position
Council
Position
EP Plenary
Position
Trilogue
negotiations
Adoption
DIRECTIVE ON E-PRIVACY
Commission
Proposal
EP Committee
Position
Council
Position
EP Plenary
Position
Trilogue
negotiations
Adoption
GH
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Olivier Hinnekens
olivier.hinnekens@mslgroup.com
Romain Seignovert
romain.seignovert@mslgroup.com
Alastair Bealby
alastair.bealby@mslgroup.com
Franois Troussier
francois.troussier@mslgroup.com
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