Tuesday 23 June 2015
A meeting of the Economic and Financial Affairs Council was held in Luxembourg on 19 June 2015. Ministers discussed the following items:
Bank Structural Reform
Council reached a general approach on this file.
European Fund for Strategic Investments (EFSI)
Ministers were updated by the presidency on progress in relation to the EFSI. The Council presidency anticipate reaching a First Reading agreement on the regulation by the end of June.
Ministers held an exchange of views on the presidency proposal on mandatory automatic exchange of information on tax rulings.
Interest and Royalties Directive
Ministers held an exchange of views on the presidency compromise on the proposal for a common system of taxation applicable to interest and royalty payments made between associated companies of different member states.
Current Legislative Proposals
The presidency gave a state of play update on current legislative proposals in the field of financial services.
Commission Communication on Corporate Taxation
The Commission presented the main elements of the action plan on corporate taxation, which was released on 17 June.
Implementation of Banking Union
The Commission updated the Council on the status of implementation of the banking union, focusing on the ratification of the intergovernmental agreement on the single resolution fund and implementation of the bank recovery and resolution directive.
Capital Markets Union
Council adopted Council conclusions on capital markets union.
Contribution to the European Council Meeting on 25-26 June 2015—European Semester
Council discussed country specific recommendations and prepared a discussion for the June European Council on the European semester.
Contribution to the European Council Meeting on 25-26 June 2015—Broad Economic Policy Guidelines
Council adopted a report to the European Council on the recommendations on broad economic policy guidelines.
Contribution to the European Council Meeting on 25-26 June 2015—Report on preparing for next steps on better economic governance in the euro area
Council received a state of play update on the report on preparing for next steps on better economic governance in the euro area.
Implementation of the Stability and Growth Pact
Council adopted Council decisions and recommendations in the context of the excessive deficit procedure.
Equitable Life Payments Scheme
As of 31 May 2015, the scheme has now issued payments totalling over £1.06 billion to 902,508 policyholders. The scheme will today be publishing a further progress report, which can be found at www.gov.uk/equitable-life-payment-scheme.
Eighty-seven per cent of eligible policyholders have now been traced and had a payment issued; this represents nearly 92% of the total amount estimated to be due to policyholders.
The scheme encourages any policyholders who believe themselves to be eligible to call the scheme on 0300 0200 150. The scheme can verify the identity of most policyholders on the telephone, which means any payment due can usually be received within two weeks.
EU Payment Accounts Directive
I am today publishing a consultation on the draft payment accounts regulations 2015.
The regulations make provision regarding the transparency and comparability of fees charged in relation to payment accounts; payment account switching and access to payment accounts with basic features for all consumers legally resident within the EU.
The regulations are required in order to implement the requirements of the payment accounts directive (2014/92/EU) (“PAD”) which was adopted on 23 July 2014. In order to meet treaty obligations, EU member states must implement the majority of the measures set out in PAD by 18 September 2016.
The Government have already taken forward a number of initiatives for the purposes of improving the experience of UK current account customers. For example, the seven-day current account switch service (CASS) supports current account switching and basic bank accounts have been available in the UK for over 10 years, most recently augmented by the December 2014 agreement concluded by the nine largest providers of current accounts in the UK. That new agreement clarified and improved the terms upon which basic bank accounts are offered.
To complete the transposition of PAD, the UK must establish these initiatives in legislation and amend existing legislation related to the provision and regulation of payment accounts. However, due to the measures that the UK already has in place, the proposed regulations aim to minimise any negative impact on structures and services that are working well.
PAD allows member states to extend provision in a number of areas. Under the draft regulations, application will not be extended beyond what is necessary.
The exception to this is chapter IV of PAD—payment accounts with basic features—where UK policy on basic bank accounts is more developed than that set out in the directive. As a result, the Government intend to implement PAD in such a way as to preserve the UK’s existing basic bank account policy, while creating the necessary legal certainty for consumers required by PAD.
The consultation closes on 3 August. The consultation document is available online at: https://www.gov.uk/government/latest?departments%5B%5D=hm-treasury
Culture, Media and Sport
The Telecommunications Council took place in Luxembourg on 12 June 2015. I represented the UK and below are the agenda items and the positions, where applicable, I took on each of them. Please be aware that the order of the agenda, as laid out in the pre-Council statement was changed by the Latvian presidency at the last minute. This statement reflects those changes.
The first item was an exchange of views on the Commissions digital single market strategy, which was published on 6 May. The debate was informed by two questions from the presidency. My intervention was as per the pre-Council statement. The Commission Vice President Ansip opened the debate by identifying three priorities for the digital single market––goods and services; infrastructure; and e-commerce and e-society. He also noted the need for progress on geographic price blocking. On copyright, he also suggested that more work was needed to harmonise exceptions currently invoked by member states.
Member state interventions covered a range of issues, including e-skills, infrastructure, e-commerce and the internet of things. Copyright and platform regulation were also two of the more commonly raised issues, with clear emerging divisions between member states. The UK, Finland, Netherlands, Poland and Sweden also linked the Commission’s better regulation agenda and the digital single market, noting the benefits of industry-led approaches where possible.
The second item was for Council to reach agreement for a general approach on the proposal for a decision of the European Parliament and of the Council establishing a programme on interoperability solutions for European public administrations, businesses and citizens (ISA2, First reading, EM11580/14). As per my pre-Council statement, I abstained from voting for the general approach. However, the rest of Council agreed to the general approach and this approach will now form the basis of the Council discussions going forward.
I hope that the improvements to the text that could not be agreed in Council will be made during the trilogue negotiations, so that the UK may support the proposal when it comes to final agreement. The UK continues to encourage the inclusion of more tangible efforts to make ISA2 a more effective programme, including clearer prioritisation and evaluation of programme actions based on user needs and clearer analysis of how actions support efforts in other parts of the Commission.
The presidency then presented a progress report on the proposal for a directive of the European Parliament and of the Council on the accessibility to public sector bodies’ websites (First Reading, EM16006/11). There was no debate on this item.
This was followed by the adoption of draft Council conclusions on the transfer of the stewardship of the Internet Assigned Numbers Authority (IANA) functions to the multi-stakeholder community. Council agreed to the adoption of these conclusions and there was no debate on this item.
There were three items under AOB on the agenda. The first two items were information from the presidency on the “state of play” on negotiations regarding “a regulation of the European Parliament and of the Council laying down measures concerning the European single market for electronic communications and to achieve a connected continent” (EM13562/13 and 13555/13 + ADDs 1-2) and information from the presidency on a proposal for a directive of the European Parliament and of the Council concerning measures to ensure a high level of network and information security across the Union (NIS directive). (First Reading, EM6342/13). The presidency updated Council on the progress of both, which are each in the middle of trilogue negotiations between the Council, Parliament and Commission. There was no substantive debate on either of these items and I did not intervene.
As noted in my pre-Council statement, the readout from the presidency on the connected continent package was informed by the informal ministerial breakfast whose aim was to reach political agreement on the regulation.
At this breakfast, Council could not reach such an agreement and the negotiation of this package therefore continues. At the breakfast, I intervened as per my pre-Council statement, especially pushing the cessation of EU roaming charges in the near future and the importance of a future-proof approach to net neutrality. I was given strong support on this approach by Germany, Denmark and the Netherlands. However, the majority of Council did not agree with this approach.
Finally, under AOB, the Luxembourg delegation informed the Council of their priorities for their forthcoming presidency before Council adjourns until the next meeting in quarter four 2015.
Justice and Home Affairs: Post-Council Statement
The Justice and Home Affairs (JHA) Council took place on 15 and 16 June in Luxembourg. My right hon. Friend, Lord Faulks QC, Minister for Civil Justice and I attended on behalf of the United Kingdom. The following items were discussed.
Justice day started with the Latvian presidency securing a general approach on the data protection regulation, following three and a half years of negotiations. The UK supported the text as a basis for negotiations with the Parliament. However, UK support had a number of caveats. The UK stressed the need for a balanced instrument that strengthens privacy rights in a simple, coherent and informed way and does not threaten innovation or the success of the digital single market. The UK also voiced strong concerns on the effect on SMEs and other business, about the overly bureaucratic “one stop shop” model, and the threats posed to freedom of expression by the so-called “right to be forgotten”, which the UK opposes on principle. The UK sees no justification for an expanded right such as that contained in the data protection regulation.
Luxembourg, as the incoming presidency, stressed that it would keep all of these concerns in mind during trilogue negotiations. Luxembourg is committed to keeping both the regulation and directive (covering personal data processed for investigating and prosecuting crime) together as a package, with the aim of full agreement on both instruments by the end of the year.
This was followed by agreement on a general approach on the simplification of public documents regulation. The Council supported the presidency compromise text, with many states noting that this helped to remove barriers and administrative burdens within the internal market. The UK and Ireland highlighted the importance of equal respect for common law and civil law traditions. The incoming Luxembourg presidency would take forward trilogue negotiations with the European Parliament on the basis of this general approach.
Over lunch, justice-related aspects of the Commission’s digital single market strategy were discussed. The Commission wanted clear, simple and legally certain rules, with targeted legislation to harmonise only where there were gaps; they stressed they were not seeking a repeat of the proposed common European sales law. The UK highlighted domestic legislation on online purchases of digital content and the UK’s vibrant e-commerce sector, suggesting that this model could be a useful starting point for EU-level work. The UK emphasised that work on these proposals should respect better regulation principles, including appropriate consultations and impact assessments. The UK also raised combating illegal content online, arguing that a voluntary removals approach, working with industry, had greater global reach than legislation and could deliver more effective results on removals.
On the European Public Prosecutor’s Office (EPPO), Ministers agreed “broadly expressed conceptual support” for the text of articles 1 to 16 of the draft regulation, which cover the balance of power between the central office and delegated prosecutors. The UK reminded member states that we would not participate in this measure.
Under AOB, the presidency noted progress on the data protection directive and work with the European Parliament to reach a compromise on the small claims regulation. The presidency and the Commission updated the Council on the recent EU-US JHA summit in Riga. The Commission highlighted co-operation with the US on combating money laundering and terrorist financing, as well as progressing on the data-related umbrella agreement and safe harbour.
The incoming Luxembourg presidency, starting in July, presented its priorities for the justice field: the two main priorities would be data protection and the European Public Prosecutor’s Office. Linked to the European public prosecutor, it planned to drive forward progress on the draft PIF (“Fraud against the EU’s financial interests”) directive and Eurojust regulation. In civil law, it would introduce proposals on family law and continue work on the simplification of public documents. A motion underlining the Council’s will to move towards EU accession to the European convention on human rights would be put to the October JHA Council. Finally, the Luxembourg presidency said it planned to present a proposal to improve political discussions at Council at its informal JHA Council meeting in July.
The interior session began with a policy debate on migration. While there was broad support for elements of the Commission’s European agenda on migration, there was no agreement on the relocation proposal. The Commission pointed to the development of “hotspots” to ensure processing of arriving migrants, beginning in Sicily, and progress on the proposed “multi-purpose centre” in Niger to try to mitigate flows through that country, alongside enhanced efforts to combat the facilitators. The European External Action Service (EEAS) confirmed that the first phase of the common security and defence policy (CSDP) mission in the Mediterranean would be launched shortly. The UK joined other Ministers in emphasising the need to tackle the root causes of migration, to tackle people smugglers and traffickers, and to break the link between rescue at sea and the expectation of remaining in the EU by returning economic migrants while supporting their reintegration in their home countries. The UK also recalled the European Council’s clear agreement that EU relocation and resettlement schemes should be voluntary rather than mandatory.
The incoming Luxembourg presidency gave a presentation which confirmed the following priorities in the area of migration: more effective returns including use of readmission agreements; progress on operational proposals such as the centre in Niger and “hotspots”; agreement to the draft regulation currently under negotiation that would clarify the treatment of minors under the Dublin regulation;n and political agreement on the visa package and the students and researchers directive. Other priorities included: combating terrorism (in particular dealing with the threat from foreign fighters), implementing the new internal security strategy, concluding trilogues on the Europol regulation, and seeking agreement with the European Parliament on the passenger name records (PNR) directive by the end of the year.
During lunch there was a discussion on returns which saw broad agreement that greater ambition was required in this area as part of the comprehensive approach on migration. More effective EU readmission arrangements were seen as an important element.
The Council conclusions on the internal security strategy were adopted without substantive discussion.
The presidency presented papers which updated Ministers on progress since the 12 February informal European Council statement on the EU response to the Paris terrorist attacks.
The Commission (Avramopoulos) drew attention to its communication “The European agenda on security” and highlighted that in the short term counter terrorism (CT) priorities included: a high-level internet industry forum event in the autumn; making the Europol internet referrals unit (IRU) operational as quickly as possible; swift adoption of an efficient and legally sound EU PNR directive; and preparing for a revision of the EU framework decision on terrorism.
The EU CT co-ordinator (Giles de Kerchove) called for detailed planning on handling the increasing wave of European returnees from Syria/Iraq. This meant investing now in exit and rehabilitation programmes and supporting Commissioner Jourova’s work on prison radicalisation. In his view, the EU also needed to find the resources to enable Europol, Eurojust and CEPOL to enhance co-operation and capacity building in third countries.
The UK welcomed progress on the Europol internal referral unit (IRU) and announced a UK secondee into the unit. The UK also praised the work of the Syria strategic communication advisory team (SSCAT). While welcoming the Commission’s action in establishing the industry forum, the UK cautioned that certain aspects of tackling terrorist abuse of the internet (including encryption and interception) were matters of national security and thus for member states rather than the EU. The UK called for robust minimum standards on legislation on firearm deactivation; for enhanced data sharing on illegal firearms and ammunition; and for the Commission to step up its work on proactive sharing of criminal records via the European criminal records information system (ECRIS). Finally, the UK again underlined the urgency of adopting, with the European Parliament, a strong and effective PNR framework, including intra-EU PNR, before the end of the year.
Europol drew attention to the excellent co-operation it has received from member states’ intelligence agencies. Europol also reported significant increases in the use of their existing CT tools. Most notably, this included the terrorist finance tracking programme (TFTP) which had led to 3,000 separate intelligence leads since the Paris attacks (some 1,500 of which were related to foreign fighters). Europol was on track to establish the IRU by 1 July and had worked constructively with social media companies in recent months.
The presidency urged renewed vigour to implement the post-Paris conclusions in order to keep pace with the threat. The presidency would report the priorities outlined during the debate (and those identified in the Internal Security Strategy Council conclusions) as the JHA Council’s input to the June European Council’s review of the post-Paris statement it agreed in February.
Under AOB, the Commission provided a brief overview of the biannual report on the functioning of the Schengen area, noting that Schengen was the solution not the problem providing that all member states fully applied the rules of the Schengen acquis. The Commission also confirmed that a new smart borders proposal would be published following the results of the pilot phase. The presidency provided an update on the EU-US ministerial meeting which took place in Riga on 2/3 June; this agreed a statement defining the common EU-US JHA agenda over the next five years. The presidency also provided an update on ongoing legislative negotiations including on the European Police College (CEPOL) and the European Union’s law enforcement agency (EUROPOL) regulations and the students and researchers directive.
Electoral Commission Committee
Scottish Independence Referendum: Campaign Expenditure and Regulation
(Representing the Speaker’s Committee on the Electoral Commission): The Electoral Commission has today published a report in the Scottish Parliament on its analysis of the spending and regulation of campaigners at the Scottish independence referendum.
This is the Electoral Commission’s second report on the referendum and fulfils its statutory duty to report to the Scottish Parliament, under the provisions of the Scottish Independence Referendum Act 2013 (SIRA), on the use of its investigatory powers and civil sanctions. For further background and information on the wider context of the referendum on independence for Scotland, this report should be read in conjunction with the report the Commission published in December 2014 on the conduct of the referendum, which is available on its website and copies of which were placed in the Library of the House on its publication.
This report analyses the funding and spending of those people and organisations that registered to campaign at the independence referendum. It builds on last December’s report and makes further recommendations for the future based on the information campaigners were required to submit in their post-referendum returns. These additional recommendations are intended to inform the regulation of future referendums, not only in Scotland, but elsewhere in the UK including an EU referendum.
SIRA contained a number of rules drawn from those that applied at the 2011 referendums on increased powers for the National Assembly for Wales and the UK-wide referendum on the UK parliamentary voting systems. These rules clarified aspects of the regulatory controls, reduced burdens on those that wished to campaign and ensured that voters had access to the information that would enable them to make an informed decision when they voted. Overall, the Commission concludes that the regulatory controls that applied at the independence referendum worked well and improved on the rules from previous referendums.
After the independence referendum, registered campaigners were required to submit a campaign spending return to the Commission. The returns included details of the spending that the campaigners incurred campaigning at the referendum and all donations and loans they accepted over £7,500. Campaigners were also required to provide a total figure of the donations and loans they received over £500 but below £7,500. Anything with a value of £500 or less was not counted as a donation or loan for the purposes of the referendum rules.
The report shows that 42 campaigners registered with the Commission, 21 indicating they supported the yes outcome to the question asked, 21 supporting the no side. Registered campaigners reported spending a total of £6,664,980 campaigning at the independence referendum and reported having received donations and loans totalling £7,318,545.
SIRA also gave the Commission the role of monitoring and taking steps to ensure compliance with the referendum campaign rules. To enable the Commission to undertake that role, it had access to investigatory and sanctioning powers. The report finds that the Commission’s powers under SIRA enabled it to effectively investigate matters. While the Commission found that it was able to obtain the information that it required through voluntary co-operation with campaigners, it also sets out that the powers SIRA provided it were useful to point to as part of its discussions with campaigners.
Copies of the Commission’s report have been placed in the Library and it is also available on the Commission’s website: www.electoralcommission.org.uk