Skip to main content


Volume 555: debated on Tuesday 11 December 2012

A meeting of the Economic and Financial Affairs Council was held in Brussels on 4 December 2012. Ministers discussed the following items:

Banking Supervision Mechanism

Ministers discussed the latest proposal for a single supervisory mechanism (SSM). There will be a further ECOFIN Council on 12 December that will focus on the SSM ahead of the European Council meeting of 13 to 14 December.

Revised capital requirements rules (CRD IV)

The presidency updated Ministers on the current state of play of negotiations with the European Parliament on the proposals for revised capital requirements rules (CRD IV).

Economic governance—Two pack

The presidency updated Ministers on negotiations with the European Parliament on two draft regulations aimed at improving economic governance in the euro area. The UK Government tabled a minute statement where:

“The UK reiterated its clear understanding that there would be no new commitments from the European Financial Stabilisation Mechanism (EFSM) following entry into force of the European Stability Mechanism (ESM) Treaty on 27 September 2012, recalling the commitment in the European Council Decision of 25 March 2011, which states that as the ESM is designed to safeguard the financial stability of the euro area as whole, Article 122(2) of the TFEU will no longer be needed for such purposes. The Heads of State or Government therefore agreed that it should not be used for such purposes”.

Financial Transaction Tax (FTT)

The presidency updated Council on the European Commission’s proposal for an authorising decision on the introduction of a FTT by some member states using the enhanced co-operation procedure. The UK will not participate in an enhanced co-operation FTT.

Credit Rating Agencies

The presidency updated Ministers on the political agreement reached with the European Parliament on the credit rating agencies 3 (CRA3) dossier.

Macro-economic Imbalance ProcedureCommission annual report

The European Commission presented its second alert mechanism report, which is the first stage in the macro-economic imbalance procedure.

Annual Growth Survey 2013

The European Commission presented the annual growth survey for 2013.

Issues related to the Economic and Monetary Union

The European Commission outlined its report on a “Blueprint” for economic and monetary union.

Implementation of the Stability and Growth Pact

ECOFIN Council considered that Greece has taken effective action to correct the situation of excessive deficit; and adopted a decision granting Greece an additional two years to correct its excessive budget deficit in recognition that:

“effective action has been taken and unexpected adverse economic events with major unfavourable consequences for government finances occur after the adoption of the recommendation”.

VAT Quick Reaction Mechanism

Ministers held an orientation debate on a proposed directive amending the common system of value added tax as regards a quick reaction mechanism against VAT fraud, in particular on the issue of whether implementing powers under the proposal should lie with the Commission or the Council. A number of member states, including the UK, reiterated the importance of decisions on tax matters being made by the Council and being subject to unanimity. The Council agreed that further work was needed on this issue.

Annual Report of the Court of Auditors on the implementation of the budget for the financial year 2011

The president of the European Court of Auditors, Mr Vitor Caldeira, presented to Council the annual report of the Court of Auditors on the implementation of the budget for the financial year 2011. The UK expressed its disappointment that the Court of Auditors were unable to give an unqualified assurance for the 18th consecutive year and that the error rate had increased to 3.9% from 3.7% in 2010.

Code of Conduct (Business Taxation)

ECOFIN adopted Council conclusions on a report in relation to the code of conduct (business taxation), summarising the work of the code group under the Cypriot presidency. Following a minute statement at Coreper by Spain, the UK tabled a statement to confirm that the Government of Gibraltar have already begun work to ensure an element of their Income Tax Act complies with the principles of the code.