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AnnuAl RepoRt
Association des Banques et Banquiers, luxembourg
the luxembourg Bankers’ Association
luxemburger Bankenvereinigung
2014
“The ABBL is a strong defender of the banking place. The ABBL is at the heart of our financial industry and has always been”
Xavier Bettel, luxembourg prime Minister
(25 March 2014)
1
Table of contents
Foreword by the Chairman 3
Foreword by the Ceo 5
FaCts & Figures 6
synthesis
ABBl’s eu interest representation in a year of institutional changes
Financial Market Regulation
Banking Supervision
legal & Compliance
tax
private Banking
Retail Banking
Commercial Banking Cluster
Depositary Banking Cluster
Innovation & payment Systems
SepA & Security of payment Instruments
Social Affairs
employers’ Representation
AGDl
IFBl – l’Institut
101112141618202223242527282930
LegisLative watCh
luxembourg Agenda of Financial Sector Dossier
european Agenda of Financial Sector Dossier
32
38
3
Yves Maas
FoRewoRD By the ChAIRMAn
the ABBl has been celebrating its
75th birthday in 2014. 75 years in pro-
viding our members with intelligence,
resources and services while being
a driving force in the luxembourgish
society where we represent the
financial industry and thus enabling
luxembourg to progress as a financial
centre.
2014 also marked the launch of a new
ABBl governance, which, amongst
other things, allows for a better
representation and involvement of the
various business lines on the financial
centre via a new cluster structure.
Challenging political, economical
and market environments are heavily
influencing and guiding the efforts of
the ABBl.
During 2014, the ABBl has not only been heavily engaged in constructive rela-tionships with public authorities and supporting its members but has also actively promoting the luxembourg financial centre.
Financial markets related technical issues such as the european Market Infrastructure Directive, Market in Financial Instruments Directive and fund regu-lations have been accompanied by the start of the political discussions on the Capital Markets union, marking a shift on the new eu Commission’s political agenda from financial stability to economic growth.
the Banking union debate entered in a final phase with the implementation of the Single Supervisory Mechanism preceded by the comprehensive assessment and stress test. Its outcome confirmed the robustness and reliability of the luxembourg banking sector, characterised by its high level of capitalisation and resilience.
the on-going importance of the topic of automatic exchange of information was substantiated by the signature of the FAtCA intergovernmental agreement and the implementation efforts of the revised eu Savings Directive and Directive on administrative cooperation provisions. In the area of corporate taxation, 2014 was marked by an acceleration of political initiatives both at oeCD and eu level. the ABBl put substantial efforts in the support of its members undergoing these profound mutations.
the ABBl also carried on in assisting our members in compliance matters, especially on a diligent application of the standards of integrity, transparency and professionalism in the provision of financial services.
Regarding innovation and its importance for the development of tomorrow’s finan-cial sector, the ABBl, as member of the “haut Comité de la place Financière”, has actively contributed to foster new solutions and business models in collaboration with its partners.
As employers’ association it is our perpetual aim to create a social environment characterised by predictability and stability. In this context, the ABBl has achieved among other things to reach a collective bargaining agreement for bank employees with the three unions AleBA, oGBl and lCGB-SeSF valid for a three-year period.
today, the luxembourg financial centre is robust, highly diversified and includes a multitude of local and international organisations. we can rely but not rest on its wide range of competencies acquired during the more of 50 years of international experience, on its financial stability and AAA rating.
5
Serge de Cillia
FoRewoRD By the Ceo
2015 promises to be a year of many
challenges and opportunities on both
the international and national level,
with luxembourg’s presidency of the
Council of the european union from
July to December 2015.
the implementation of new regula-
tions, and particularly the costs
involved, remains one of the biggest
challenges for our sector at the
moment. the ABBl will therefore
closely follow the set up of the Single
Supervisory Mechanism during 2015.
the Banking union’s implementation
will continue with the Bank Recovery
and Resolution Directive providing the
foundations of the Single Resolution
Mechanism.
the ABBl will also continue to closely
monitor the structural reform of the
Banking sector as foreseen by the eu
Commission. It is essential to main-
tain the financing possibilities for the
european companies.
Many forthcoming regulations will also have a financial and administrative impact on the various actors of the luxembourg financial centre (oeCD Common Reporting Standard, FAtCA, eMIR, uCItS V, MiFID II, CRD IV, SepA, Money Market Funds). the 4th Anti Money laundering Directive and regulation will strengthen eu rules against money laundering and ensure consistency with the approach followed at international level. Such transitions take time and are very complex. however, luxembourg is well positioned to handle this due to its pro-active and responsive approach as well as its international expertise.
In addition, the going live in June 2015, of t2S, the eCB outsourcing It platform for settling euR traded securities, is removing barriers across countries between the settlement of domestic and cross-border transactions. It will be a key driver for harmonisation of post-trade services and standards across the eurosystem, and thus contribute to achieve stronger financial integration and a true european single market.
As the luxembourg Bankers’ Association, it is our role to anticipate regulatory developments and guide our members in preparing and implementing all these new rules. Investments into compliance functions, in It infrastructure and in administration have increased significantly and will continue to do so.
In this current transition process, one of the biggest changes relates to our work-force. In order to attract and service a new and more demanding clientele, we need to invest in developing the skills and capabilities of our staff. training and education will become ever more vital in the future in order to offer to our national and international clients a full range of services that they cannot get elsewhere.
From now on, we also need to anticipate and closely monitor ICt developments. the digitalisation of financial services is becoming increasingly significant and we must be able to adapt to the requirements and expectations of a new generation of clients. luxembourg has world-leading data centres and high connectivity to all the major Internet hubs. there is enormous potential for synergies with the financial sector as well as business opportunities for our banks and other financials sector actors.
we have a great opportunity to further broaden and diversify our client base, to attract new business and to encourage companies to set up their business hubs in luxembourg. we will continue, together with our partners, to develop and pro-mote our diversified services offer and expertise because this diversity is precisely what makes the luxembourg financial centre unique.
6
FACtS & FIGuReS
Private Banking - Key figures
Revenues
1.682 billion euRCSSF/ABBL Private Banking Survey 2014
Client faCing staff
1,766PwC calculations
18.3
1.4
19.7
1.5
0.8
4.6
2.4
1.3
assets undeR management
307 billion euRCSSF/ABBL Private Banking Survey 2014
diReCtly employed
6,783CSSF/ABBL Private Banking Survey 2014
Geographic origin of PBLU client assets (%)
8%5,000,001 - 10,000,000 €
18%
1,000,001 - 5,000,000 €
47%> 20,000,000 €
7%500,001 - 1,000,000 €
6%
250,001 - 500,000 €
5%
100,000 - 250,000 €
10,000,001 - 20,000,000 €
8%
Wealth bands in terms of assets *
5,000,001 - 10,000,000 €
500,001 - 1,000,000 €
250,001 - 500,000 €
10,000,001 - 20,000,000 €
Wealth bands in terms of number of clients *
100,000 - 250,000 €
500,001 - 1,000,000 €
> 20,000,000 €
47%
23%
14%
12%
2%
2%
1%
* Figures may not add up due to roundingotheR euRopean
CountRies
8.5Belgium
15.1otheR non-eu
CountRies
united states of ameRiCa
latin ameRiCa
afRiCa
middle east
5.8fRanCe
luXemBouRg
easteRn euRope (non-eu)
5.9geRmany
14.5not defined
asia & asia-paCifiC
Consumption
2000 803 4,588 1,187
Real estate otheRs
15,867 2,005
1,153 21,244 2,786
1,145
8,842 1,0251,126
2014
2010
2005
luXemBouRg
2003
otheR euRozone CountRies
Rest of the woRld
2014
2011
2007
Retail Banking - Key figures
35,325 15,011 14,912
23,915 18,671 15,980
19,844 24,229 17,796
17,442 29,373 12,635
Loans (in million EUR)Source: BCL
Deposits (in million EUR)Source: BCL
7
FACtS & FIGuReS
germany33
italy10
united Kingdom9
switzerland12
China6
usa6
Brazil5
Japan5
luxembourg5
Belgium7
israel3
Qatar3
andorra2 france
15
spain3
Canada2
portugal2
Russia2
Cyprus1
denmark1
sweden7
netherlands3
greece1
latvia1
liechtenstein1
turkey1
from eu103
outside eu45
norway2
8
Banks - Key figures
Number of banks per country of origin Source: CSSF
nov 2013
733Jan 2014
734apRil 2014
723august 2014
741nov 2014
753
Evolution of the banks’ balance sheet total (in million EUR)Source: CSSF
12.6%
12.4%
14.3%
14.7%
17.6%
19.7%
1995
2006
2002
1998
2010
2013
Evolution of the solvency ratio (weighted average)Source: CSSF
Total148
9
Employment - Key figures
ExecutivesSept. 2014
72%18%
35% 20% 20% 12% 4% 3% 1.5%4.5%
Breakdown by nationalitySept. 2014
Total own funds / of which Tier 1(in million EUR)Source: CSSF
1996
15,22412,004
2000
24,59520,375
2005
32,64926,981
2009
44,15138,136
2013
49,00142,848
Interest-rate margin / Commission income(in million EUR) Source: CSSF
dec. 2005 dec. 2007 dec. 2009 dec. 2011 dec. 2014
3,905
3,209
6,002
4,010
6,571
3,132
5,865
3,832
4,790
3,903
Evolution of total employment
46%54% 54%46%
1995 2014
18,255 26,055Source: BCL
9
Luxembourg Vs Foreigners’ evolution
55%45% 77%23%
1995 2014
Source: BCL
18,255 26,055
Source: ABBL Survey
Source: ABBL Survey
franceBelgium luxembourg germany italy portugal other eu
outside eu
10
around the anti-money laundering directive, which was concluded in the previous parliamentary term by a trilogue agreement in December.
the Money Market Funds Regulation had not been able to be concluded in the previous parliamentary term and was back on the table early on in September 2014 for Meps who voted their report in the economic and Monetary Committee (eCon) in March 2015 for approval of amendments end of April. Similarly work on the Regulation on the Reform of the Bank Structure had for time constraints rea-sons consciously been avoided by the european parliament at the end of the previous mandate. the file has been taken up by the new european parliament with a vote in eCon at the time of writing being scheduled for April 2015. the ABBl has been active on these files from the beginning in the european parliament and without in-terruption in the Council.
the same holds true for tax files like the all time classic of the Savings tax di-rective, the administrative cooperation directive and, of course, the Financial transaction tax. Although not directly targeted, the ABBl has followed the evolutions in the european parliament and in the Commission around the issue on tax rulings.
For the representation of ABBl’s in-terests within the european union institutions, the year 2014 was par-ticular in nature as it saw the election and constitution of a new european parliament in May-June as well as a new Commission taking office a few months later. the ABBl devised and has been implementing since an en-gagement strategy with these new and already well-known actors.
the luxembourg Bankers’ Association and its eu Representative office have closely followed the outcome of the european elections and the constitu-tion of the new parliament. Contacts from early on have been taken with new relevant Meps and their often-new staff and have been very regu-larly followed-up. An important aspect was the positioning of Meps in par-liamentary committees active in the fields of interest to the ABBl after a generational shift in key committees. the ABBl has also introduced itself to many new Meps as well as key chal-lenges and opportunities in legislative files already on the table such as the reform of the bank structure or the regulation on money market funds. the ABBl made all efforts to quickly adapt to this new environment and be-come active from the very first weeks of legislative activity.
the renewal of the european Commission has had until the writ-ing of these lines no major incidents on the services of the Commission but changes at top level are expect-ed over the months to come. the main shift has been materialised in the innovative cluster structure of the Commission and the nomination of new Commissioners to key ABBl areas of interest like financial services, taxation, consumer protection or trade. Contacts have also been taken with key cabinet members and the ABBl is currently preparing to meet new actors at Commissioner level.
the renewal of two of the three legislative institutions has inevitably had an impact on the legislative process with a political push to close a number of issues before the end of the parliamentary term on which the ABBl has been intensively active. In winter / early Spring the legislators have been intensely negotiating compromises on legislations like the Single Resolution Mechanism (SRM), the Bank Recovery and Resolution Directive (BRRD), the Markets in Financial Instruments Directive (MiFID II), the packaged Retail Investment products Regulation (pRIps) or the review of the retail investment funds directive (uCItS V). the year 2014 also saw intense activity
ABBL’s EU interest representation in a year of institutional changes
SyntheSIS
11
Financial Market Regulation
in proposing ideas to promote and defend its market.
Capital Market Union
Although the project is formally sched-uled for 2015, the announcement by the eu Commission president of a plan for action called Capital Market union (CMu) triggered discussion in the in-dustry and think tanks about what the plan could be and how to best meet the objectives of better integration of markets, increased harmonisation and improved crossborder transactions with the laudable aim of stimulating SMes access to financing.
The ABBL Cluster under Financial Markets
In 2014, ABBl created three new clus-ters in the Financial Markets domain based on specific business lines.
the first cluster covers the listing and trading business, mainly contributing to MiFID II.
the second cluster covers the post market infrastructures and actively contributed to the Central Securities Depositories Regulation (CSD-R) con-sultations, helping the ABBl prepare its responses.
Finally, the third cluster covers the depositary and custodians’ busi-ness and made contributions to the uCItS V file and took part in the eSMA consultations.
EMIR - European Market Infrastructure Regulation
In mid-February, the eMIR part of the global regulatory agenda began, through the reporting of derivative transactions, this more than 2 years after the entry into force of the text - the first step in the fulfilling of the eMIR obligations. In 2014, luxembourg with the support of the ABBl finalised the set up of a legal entity Identifier (leI) issuance agency.
the eu Commission issued a new draft regulation on Securities Financing transactions which basically proposed to revise the eMIR reporting for trans-actions, such as securities lending or repurchase agreement (Repo).
April marked a regulatory turning point as the european parliament votes on the MiFID II, MAD/MAR, uCItS V, CSD-R, pRIps thus closing most of the open files from the Commissioner Barnier area before the summer re-cess. there was however one major exception, the Money Market Fund Regulation, which failed to be agreed in the ep due to a political debate be-tween two conceptions of the solution.
MiFID - Markets in Financial Instruments Directive
eSMA the european Securities Market Authority started, only one month after the date of the vote and prior to publi-cation, a large consultation on MiFID II
(800 pages/800 questions), providing a little over 2 months to share views. this has been an opportunity for the ABBl to create a dedicated structure composed of a steering committee and working groups per topics for its members to assist them imple-menting MiFID. It has been followed, in December 2014, by an additional 1,800 pages of recommendations and new consultations.
During the summer of 2014, luxembourg issued a new law on the immobilisation of bearer shares and fund units, which triggered a high level of concern among the ABBl members with regard to the operational handling required by law. together with the legal department of the ABBl, a joint forum was created to deal with the imple-mentation of the law in the interest of the luxembourg economy.
Fund Regulations
At the end of the summer, eSMA issued two consultations: one to define products eligible for mandatory clear-ing under eMIR, and a second one on uCItS V (undertakings for Collective Investment in transferable Securities) with a proposal to ban intragroup pro-vision of both asset management and depositary function.
From September until the end of the year, one of the key components was the regulation of money market funds, where the ABBl was instrumental
12
the year 2014 was marked by the conclusion of the long-debated Banking union. the Single Supervisory Mechanism (SSM) entered into a con-crete phase, where the eCB took over the supervisory responsibility of banks located in the eurozone in november 2014. prior to this, the eCB con-cluded the comprehensive assess-ment of the european largest banks. the ABBl supported this unprece-dented exercise, which was a neces-sary condition to promote transpar-ency and to restore confidence in the european banking sector. the ABBl particularly welcomed the fact that
the six luxembourg individual banks and banking groups subject to the Comprehensive Assessment have suc-cessfully passed this test. Such a posi-tive outcome confirms the robustness and the reliability of the luxembourg banking sector, which is characterised by its high level of capitalisation and by its resilience.
the evolution of the average solvency ratio illustrates this trend:
Banking Supervision
Evolution of solvency ratio 20%
18%
16%
14%
12%
10%
8%
1995
1996
1997
1998
1999
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012
2013
12.6 12.5 12.4 12.4 13.3 12.0 12.7 14.3 16.5 16.5 15.2 14.7 14.7 14.3 17.5 17.6 17.4 17.7 19.7weighted average %
Source: CSSF
13
Mechanism (SRM) centralises cri-sis management for those banks. It includes the creation in 2015 of a Single Resolution Board (SRB) and of a Single Resolution Fund (SRF). the latter has a target level of €55 billion, to be reached over eight years starting 2016. the contributions will be made in national compartments and mutual-ised over years.
Finally, after more than three years of negotiations, the recast of the Deposit Guarantee Scheme Directive (DGSD) has been agreed on December 2013 and is expected to apply in July 2015, after the transposition into national law. the recast introduced ex ante financing requirements for DGS in the Directive. the target level for ex ante funds of DGS is at minimum 0.8% of covered deposits to be collected from banks over a 10-year period. the substan-tial changes introduced by the recast Directive and the precisions brought forward by the european Banking Authority will, in the short term, lead to a reshape of the Association pour la Garantie des Dépôts Luxembourg asbl (AGDl), on the legal and operational aspects.
In the course of 2015, the ABBl will closely follow the implementation of the SSM, focusing on the treatment of national discretions, the indirect super-vision of less significant banks and the functioning of joint supervisory teams. In this new supervisory landscape, it is also crucial to find the right chan-nel for conveying messages of the luxembourg banking community: this is being done via the participation of the ABBl to the SSM Strategy Group of the european Banking Federation. this high-level Group gathers the rep-resentatives of the largest banks of the SSM and those of several national associations, including the ABBl.
In addition to a common supervisory mechanism, the Banking union has built a common recovery and resolu-tion toolkit for banks to plan for and act in stress situations through the Bank Recovery and Resolution Directive. expected to be fully applied in 2015, yet the requirements to draft recovery and resolution plans are taking form. the Directive provides the foundation for the Single Resolution Mechanism– the counterpart to the new Single Supervisory Mechanism for euro-zone banks. the Single Resolution
In 2014 also, following the conclusions of the high-level expert Group (hleG) chaired by erkki liikanen, the eu Commission has published a propos-al on the structural reform of the eu banking sector. the eu Commission official proposal is articulated around two main principles:
the ban of proprietary trading, which is used for speculative purpose and has no link with depositors and real economy;
the potential separation of risky market activities other than propri-etary trading, where more responsi-bility is given to the supervisor. If it is justified, the supervisor will impose a subsidiarisation of these activities.
As a priority, the ABBl considers that the reform should not undermine the financing possibilities of the european economy. More particularly customer-related transactions should not be assimilated to trading activities, and they should remain in the deposit bank.
14
Legal & Compliance
the options given to the bank in case of non-compliance of their clients: in that respect the professional may re-strict the services that he provides to clients and in particular refuse to car-ry out certain operations relating to withdrawals of substancial sums in cash unless good reason are given for the withdrawal in question,
Concerning professional interme-diaries, banks must ensure that they make them fully aware of the principles and rules set out in the ICMA Charter and in the ABBl recommendations.
It is also worth noting that, in the forth-coming adoption of the 4th eu AMl Directive, tax crimes will qualify as predicate offence.
In 2014, the ABBl legal Department was committed, as in the past, to manage legal monitoring and defend the interests of its members in the legislative process.
Focus on the law on the immo-bilisation of bearer shares and units
the main focus of this year was the law on the immobilisation of bearer shares and units. As part of the inter-national effort for greater transparency in financial activities, the luxembourg government has taken new measures by introducing the law on the immo-bilisation of bearer shares and units, in order to identify the sharehold-ers of luxembourg companies and funds (including fund units). this law of 28 July 2014 came into force on 18 August 2014 and affects all issu-ers of luxembourg shares and share-holders (irrespective of their place of residence).
Compliance
In May 2014, the ABBl issued a guidance note on a diligent application of the standards of integrity, trans-parency and professionalism in the provision of financial services to clients. In the context of the imple-mentation of the International Capital Market Association Charter (ICMA) and of the FAtF recommendations, as well as of the introduction of a system for the automatic exchange of infor-mation, it seemed useful to reiterate some principles, in particular:
the obligation for banks to know their clients,
the obligation to obtain informa-tion about the origin of funds, to obtain reasonable assurance that their clients respect the fiscal obli-gations applicable to them, and to provide them with information and assistance,
15
and Markets Authority (eSMA) and the european Banking Authority (eBA). on 16 January 2015, the Minister of economy introduced a draft law aim-ing at transposing Directive 2013/11/eu (draft law no 6769).
Access to the intelligence, resources and services
More generally, the ABBl legal Department keeps our members in-formed via the ABBl website and the “nouveautés du Droit Bancaire et Financier” newsletter, as well as the publication of guidelines and position paper.
It should be noted that a legal forum was set up in 2014, whose main focus is to keep our members up-to-date as far as legal matters are concerned. to register to this legal Forum, please send an email to: [email protected]
Treatment of customer com-plaints: out-of-court complaint resolution
on 27 June 2014, the CSSF adopted a Circular no 14/589 on “Details con-cerning CSSF Regulation no 13-02 of 15 october 2013 relating to the out-of-court resolution of complaints”. this circular aims to clarify the implemen-tation of CSSF Regulation no 13-02 relating to the out-of-court resolution of complaints by the supervised insti-tutions (see a summary of this regula-tion in the ABBl Annual report 2013). Sections 1 and 3 of the CSSF regu-lation entered into force on 1 January 2014 and Section 2, which requires professional of the financial sector to adapt their internal procedures to the requirements of the regulation, entered into force on 1 July 2014. the CSSF Circular of June 2014 added clarifica-tions on the procedure for complaint handling at professionals, the obliga-tions of the director in charge of the
complaints and the communication of information to the CSSF in relation to the number of complaints regis-tered by the professional, the type of complaints and the measures taken to handle them.
It is worth noting that CSSF Regulation n° 13-02 and CSSF Circular no 14/589 already took into account the principles of Directive 2013/11/eu of the european parliament and of the Council of 21 May 2013 on alterna-tive dispute resolution for consumer disputes and amending Regulation (eC) no 2006/2004 and Directive 2009/22/eC (not yet transposed), as well as the principle on “Complaints handling and Redress” included in the ten G20 high-level principles on Financial Consumer protection drafted by the oeCD and published in october 2011 and the “Guidelines for handling consumer complaints in the securities (eSMA) and banking sectors (eBA)” drafted by the european Securities
16
Tax
Financial institutions are required in parallel to implement the mandatory exchange of information under the cur-rent eu Savings Directive starting from 1 January 2015, while information on wages, pensions and director’s fees paid to beneficiaries resident in another eu Member State shall be reported on an annual basis to the luxembourg tax authorities starting in 2015.
In the field of corporate taxation, 2014 was marked by an acceleration of po-litical initiatives, both at oeCD level and eu level, targeting multinational companies. this move is to our view, essentially attributable to the multiplic-ity of non-harmonised domestic legal and tax rules and the failure of national governments to agree in the first in-stance on harmonised tax rules, with all these factors leading to significant arbitrage possibilities on the part of companies operating internationally.
2014 witnessed major breakthroughs in the field of the automatic exchange of information for tax purposes. luxembourg signed an intergovern-mental agreement with the united States, which gives rise to the auto-matic exchange of information between these two countries on the basis of FAtCA, with a view of having a first exchange of information in 2015.
At oeCD level, a global standard for automatic exchange of information was approved by the member coun-tries. this new standard, which draws extensively on the intergovernmental approach to implementing FAtCA, brings interests, dividends, as well as account balances and sales pro-ceeds from financial assets within the scope of the automatic exchange of information.
the new standard will be implemented between eu Member States starting from 1 January 2016 on the basis of a revised version of the Directive on administrative cooperation in the field of taxation, which will supersede the current eu Savings Directive.
In the aftermath of the seventh meeting of the Global Forum on transparency and exchange of Information for tax purposes held in Berlin, luxembourg also committed to apply the oeCD standard within the same timeframe vis-à-vis a significant number non-eu countries. the list of participating countries is expected to further ex-pand by 2018. Significant resources shall thus be allocated by financial in-stitutions during the year 2015 in order to start implementing the new oeCD standard on 1 January 2016.
17
the oeCD, after having issued a 25 points action plan on “base erosion and profit shifting” (BepS), drafted, in the course of 2014, more detailed re-ports on certain aspects of this action plan (notably BepS 2 on “hybrid mis-matches” of financial instruments hav-ing at the same time characteristics of debt and equity; BepS 4 on “interest deductions”; BepS 6 on “preventing (double-tax) treaty abuse” and BepS 10 on “transfer pricing guideline for low value intragroup services”).
In parallel, the eu is working on a di-rective pertaining to the automatic exchange of information of tax rulings (issued by Member States in order to attract foreign enterprises to their ter-ritory), while the draft directive on a “common consolidated corporate tax base” (CCCtB) gained renewed po-litical momentum in the course of the year. As for the latter, it remains to
be seen whether eu Member States can agree on an appropriate appor-tionment formula that would notably respect the prerogatives of bigger Member States and smaller Member States alike. Failing this, one can fear that the outcome of the debate would be a series of subjective anti-abuse provisions that would, in the end, significantly impede international and cross-border activities.
Another point of interest is the recent proposal for an eu financial transac-tion tax currently under discussion in several eu Member States, as part of the enhanced cooperation procedure. while no significant progress was made in the course of the year, an out-come essentially attributable to diver-gence of views among the participat-ing Member States with respect to the scope of the tax, recent declarations at the highest political level indicate that a breakthrough remains possible on this dossier. the declared ambition of the Member States participating in the enhanced cooperation is to have a
tax with the widest possible base and low rates, with a starting date set for 1 January 2016. whether or not this timeframe can be achieved will depend in part on the two forthcoming eu presidencies, latvia and luxembourg, two countries that do not participate in enhanced cooperation in this field.
18
Further, as shown in the enclosed graphs, the shift from affluent client as-sets towards the high net worth (hnw) and ultra high net worth (uhnw) seg-ments continued to progress, since clients with assets over 5 million now represent some 62% of total client AuM in luxembourg private banks, whilst the number of clients with assets of less than € 500,000 continued to decrease. In 2013, the latter segment represented only 12% of total AuM.
Evolution of Wealth Bands in terms of Assets
Private Banking
the current economic and market en-vironment in which luxembourg pri-vate banks are evolving is undergoing profound changes as private banks have to respond to increased and ev-er-changing regulatory requirements, such tax transparency (automatic ex-change of information in tax matters according to the oeCD CRS), as well as forthcoming suitability (MiFID 2) and anti-money laundering (4th eu AMl Directive) requirements. As highlighted in the recent ABBl/ey study on the cost of compliance, banks’ operation-al costs have soared in recent years, putting further pressure on profit mar-gins. luxembourg private banks have reviewed their business models ac-cordingly (including the pricing of their products and services offering), among others by enhancing their It and in-vestment advisory processes and by
focussing on a number of key strategic markets and client segments as well looking at entering new markets.
As in previous years, the ABBl private Banking Cluster – the private Banking Group luxembourg (pBGl) – closely monitored the evolution of the wealth management business sector in luxembourg with particular attention on the impact of such regulatory and strategic business changes.
Findings based on 2013 year-end fig-ures can be summarised as follows. the figures confirmed the generally anticipated trend with Assets under Management (AuM) remaining stable at € 307 billion (+0.7% compared to the previous year). private Banking staff in luxembourg decreased by 3.7%, compared to a decrease of 1.1% for the banking sector overall.
AuM € 307 billion +0.7%
Revenues € 1.682 billion of revenues +0.5%
Full Time Employees
(FTEs)
Directly employed end 2012 - 7,044 FtesDirectly employed end 2013 - 6,783 FtesClient facing staff - 1,766 Ftes
-3.7%
HeadCounts (HCs)
Banking employment 2012: 26,537
2013: 26,237-1.1%
NumberBanks in luxembourg 2012: 142
2013:147+5
Source: CSSF / ABBL Private Banking Survey 2014
100
90
80
70
60
50
40
30
20
10
0
Source: CSSF / ABBL Private Banking Survey 2014
2011 2012 2013
> 20,000,000 €10,000,001 - 20,000,000 €5,000,001 - 10,000,000 €1,000,001 - 5,000,000 €500,001 - 1,000,000 €250,001 - 500,000 €100,000 - 250,000 €
41.0%
8.1%
8.0%
19.2%
8.6%
7.7%
7.3%
43.2%
8.1%
8.2%
18.8%
8.1%
7.1%
6.5%
46.5%
8.3%
8.1%
18.2%
7.3%
6.1%
5.4%
Global Results
19
Another noteworthy trend is that pri-vate banks’ market coverage, initially circumscribed mostly to Continental europe and in particular neighbour-ing countries, has gradually moved towards a model leaning more on in-ternational diversification of the client base, sometimes outside of the eu.
Evolution of Wealth Bands in terms of number of clients
luxembourg has one clear competi-tive advantage over other financial centres in this increasingly complex, fast-changing and tax transparent world. private bankers in luxembourg, as well as lawyers, consultants, tax ad-visors and insurers, have a long-term experience in reconciling different na-tional regulatory and tax constraints. Because of this multi-jurisdictional expertise, luxembourg is perfectly positioned to help clients with an in-ternational dimension to achieve their ambitions.
the paradigm shift that the industry is currently facing, particularly in areas such as tax transparency, client pro-tection and suitability, forces private banks to actively review and adapt their business and operational strate-gies, providing growth and a competi-tive advantages for those that are early movers.
Evolution of Geographic Origin of Client Assets
2011 2012 2013
100
90
80
70
60
50
40
30
20
10
0
300
250
200
150
100
50
0
2011 2012 2013
100,000 - 250,000 €
250,001 - 500,000 €
500,001 - 1,000,000 €
1,000,001 - 5,000,000 €
> 5,000,000 €
totAl
x1,000
Num
ber
of a
ccou
nts
21.7%
18.0%
16.8%
24.7%
18.7%
14.3%
25.1%
18.5%
23.2%
18.9%
14.5%
27.2%
19.7%
20.2%
18.3%
non defined
non-eu countries countries
other eu countries
Belgium / France / Germany
luxembourg
Source: CSSF / ABBL Private Banking Survey 2014
Source: CSSF / ABBL Private Banking Survey 2014
20
Retail Banking
Member State, sets out a list of at least 10 and no more than 20 of the most representative services linked to a pay-ment account for which consumers should be given information on fees, and includes a glossary of standard-ised european terms and definitions for these services.
the eBA is elaborating guidelines to assist competent national authorities to identify at national level the most representative services linked to a pay-ment account and subject to a fee. these lists will be used by the eBA in developing eu-level standardisation of the terminology.
the aim of the directive is to promote transparency, and allow the consumer to better compare payment account services and fees and help avoid finan-cial exclusion.
the ABBl working group is analysing and setting up comments on the main issues for the banks.
Member States have until 18 September 2016 to transpose the directive into national law.
Credit register
A “Credit register” working group has been set up to analyse the practicali-ties of setting up a credit register in luxembourg. the purpose of a credit
Mortgage lending directive
At the beginning of 2014, the european legislator adopted the Mortgage Credit Directive in order to strengthen con-sumer protection within this field.
the text covers loans granted to private individuals to purchase property for residential use and lays down certain provisions the borrower must comply with, prior to entering into the contract.
the Directive thus provides for, in particular:
Certain obligations that must be re-spected concerning advertising for mortgage lending;
the permanent availability to the consumer (either on paper, another durable medium or in electronic form) of general, clear and under-standable information about mort-gage products on offer;
the provision of customised infor-mation to the consumer based on a european Standardised Information Sheet, which will enable consumers to compare offers from various providers;
the assessment of the consumer’s creditworthiness prior to entering into a contract;
A harmonised annual percentage rate (ApR), making it easier for the consumer to compare all advertising
material, as well as pre-contractual information;
the opportunity for the consumer to pay back the loan in advance, either in whole or in part.
In accordance with the directive, the european Banking Authority (eBA) is elaborating draft guidelines on the creditworthiness assessment of the consumer and on arrears and foreclos-ure to ensure that those provisions are implemented and supervised consist-ently, across eu Member States.
working groups of the ABBl have been set up to analyse the directive and the eBA guidelines, and comments on the main issues were sent to the compe-tent authorities. Member States have until 21 March 2016 to transpose the directive into national law.
Payment accounts directive
In 2014, the european union has pub-lished a directive on the transparency of bank account fees, basic banking services and bank account switching. the directive provides that Member States shall ensure that payment ac-counts with basic features are offered to every consumers.
Additionally, the directive covers the option of switching bank accounts from one bank to another in the same
21
banks to determine their market posi-tioning and anticipate future trends.
Evolution of loans
Consumer credits provided by credit institutions have shown a stable devel-opment in recent years and mortgages have increased continuously and signifi-cantly. In addition, the figures show no significant decline as regards to loans granted since the financial crisis in 2007.
Evolution of deposits
whereas in other eurozone countries, deposits have decreased significantly in recent years, whilst remaining stable in the rest of the world, luxembourg has shown a significant increase in deposits since 2007.
register of this kind is to prevent over-indebtedness and to provide better information for lenders about the sol-vency of the borrowers to enable them to take soundly based decisions on the granting of loans.
the credit register thus enables the banks to improve their management of the risk incurred by granting cred-its at national level and, above all, on a cross-border basis. the introduc-tion of a credit register of this kind in luxembourg will in fact enable the banks to gain access to the credit registers of the other Member States of the eu on the basis of the princi-ple of reciprocity which is laid down in
the european directives on consumer credits and mortgage credits.
the ABBl held discussions with the Ministry of Finance, the luxembourg Central Bank (BCl), the national Commission for Data protection to analyse the feasibility of implementing a commonly used infrastructure (BCl and banks) on the background of an appropriate legal framework.
Retail Banking Study
the “Retail Banking” study, initiated in 2011, was repeated in 2014 with the members of the Retail Banking Cluster of the ABBl. the collection of various statistics on retail banking helps retail
40,000
35,000
30,000
25,000
20,000
15,000
10,000
Jan-
2003
nov
-200
3
Sep
t-20
04
Jul-2
005
May
-200
6
Mar
-200
7
Jan-
2008
nov
-200
8
Sep
t-20
09
Jul-2
010
May
-201
1
Mar
-201
2
Jan-
2013
nov
-201
3
Sep
t-20
14
Evolution of loans
Jan-
1999
Sep
t-19
99
May
-200
0
Jan-
2001
Sep
t-20
01
May
-200
2
Jan-
2003
Sep
t-20
03
May
-200
4
Jan-
2005
Sep
t-20
05
May
-200
6
Jan-
2007
Sep
t-20
07
May
-200
8
Jan-
2009
Sep
t-20
09
May
-201
0
Jan-
2011
Sep
t-20
11
May
-201
2
Jan-
2013
Sep
t-20
13
May
-201
4
Evolution of deposits
luxembourg
other eurozone countries
Rest of the world
Real estate
Consumer
other
25,000
20,000
15,000
10,000
5,000
0
(in million EUR) (in million EUR)
Source: BCL Source: BCL
22
In 2014 the foundation for the creation of an independent ABBl cluster en-tirely dedicated to commercial bank-ing, the Commercial Banking Cluster, luxembourg (CBCl) was laid, whilst it previously shared the same cluster with the retail banking business. Following this trend, the ABBl has decided to create a specific cluster with the pur-pose of grouping together members who are active in Commercial Banking and to define the initiatives and actions to be taken in the interest, and for the defense and promotion of the spe-cific activities of operators in the areas concerned.
luxembourg is a recognised interna-tional business center for corporate clients, since luxembourg specialists have been offering syndicated loans, financing structures, group pension vehicles and covered bonds (debt ve-hicle to finance airplanes or ships, for instance) for many years.
More recently, luxembourg authorities have strongly encouraged the devel-opment of new activities in the area of
commercial banking so that many mul-tinationals have set up their european headquarters or their treasury centres in the country.
the CBCl handles issues such as trade finance, funding, treasury and hedging transactions. It will also deal with international loan activities, cov-ered bonds and international leasing activities. the customers who are cov-ered are sovereigns or public entities, large corporates in luxembourg and abroad as well as SMes on an inter-national scale.
these are, among others, the main achievements obtained by the CBCl executive Board in 2014:
In order to support the efforts of the luxembourg Banking community to revitalise the luxembourg Covered Bond market, a luxembourg Covered Bond Vademecum has been issued. this decision has been taken primarily to support current and potential future luxembourg is-suers of covered bonds in establish-ing and marketing their products;
Active participation and contribu-tion in two working groups regard-ing ‘transparency’ and ‘long term financing’ set up by the european Covered Bond Council (eCBC);
the “haut Comité de la place Financière” - working Group on Credit Activities was set up by the ministry of Finance: active participa-tion and contribution in the identifi-cation of a number of recommen-dations submitted to the Ministry of Finance.
If 2014 laid the foundations, 2015 should be the year for strategy im-plementation and for seeking new opportunities.
Commercial Banking Cluster
23
with the General Meeting of the ABBl, the decision was taken to focus on business lines in order to be closer to our members. the Depositary Banking Cluster was created with the aim to represent the depositaries in light of AIFMD and uCItS V regulations, as well as discuss market guidelines on other topics.
the consequences of the AIMFD and the upcoming uCItS V have been to place at the centre stage the de-positary of a fund, through sharply increased responsibilities and duties. this has triggered a Copernican revolu-tion for the participants of this industry suddenly realising how key their func-tion was and how important they are for the financial centre. Indeed most of the over 3 trillions euros of funds under administration in luxembourg are deposited at such banks.
the creation of the cluster took some times notably to assess the missions and define a strategy. this did not impede the group of some 41 banks
to take an active role with the devel-opments of the level 2-Regulation of uCItS V. the DBCl has been involved notably in direct discussions with eSMA or with other international plat-forms like the eBF or european trustee and Depositary Forum (etDF).
In luxembourg, the creation of this cluster is a complementary tool to the existing Depositary Banks Forum that is co-organised between ABBl and AlFI. Its aim is to focus on pure bank interests. It has to be noticed that al-most all bank members of the DBF are members of the cluster and vice-versa. Depositaries represent a key group of activities and have a material impact on the economy and employment.
plans for the future are to define and create targeted working groups and communication to the outside world on the services and products they offer, besides ensuring a true repre-sentation of their interests.
Depositary Banking Cluster
24
Innovation & Payment Systems
platform”. this inter-ministerial ex-change and decision platform is to position luxembourg as an ICt excel-lence hub supporting all economic, public and private sectors.
Considering the prominent role ICt has already played over the past dec-ades and will continue to play with re-gard to the design of modern, efficient and secure customer centric financial services, the ABBl has started actively to take part in various working parties that started since the end of 2014. Many themes are discussed, the most important being Fintech.
the ABBl’s aim is to raise awareness about Fintech issues and include the opinion of the ABBl members in the recommendations submitted to gov-ernment, which include setting the ap-propriate legal and regulatory frame-work, actively supporting innovative projects and creating new financial services markets. Beginning of 2015, a new Forum on Innovation and new technologies will be launched. to register to this Forum, please send an email to: [email protected]
Business Finance
In 2014, a major debate started in europe and luxembourg about Business Finance and especially the difficulties which SMes face in financ-ing themselves, by taking out loans or accessing capital markets. this debate has been intensified by eC president Jean-Claude Juncker’s action plan in which “Finance for growth” is a major objective.
the financial sector in europe and luxembourg has had to face critics not justified and others less so, stating that the sector would not supply the real economy and, notably SMes, with the required funding, and thus hamper de-velopment projects and hinder growth. publicly available statistics show that these critics are generally unjustified.
At european level, the european Banking Federation set up the Business Finance Committee in which the ABBl is represented. the role of this committee consists essentially of examining the current situation, measuring the underlying problems of financing the real economy, entering into discussions with eu institutions and defining common positions in this field, as well as new possible finance instruments.
the ABBl started to moni-tor several initiatives that recently popped-up beside the tradition-al “Société nationale de Crédit et d’Investissement” (SnCI)-linked ac-tivities. the ABBl decide to set up a
lobbying task force, the Business Finance Forum, which will act as sin-gle point of contact for these various initiatives (additional information on the Retail Banking Cluster and the Commercial Banking Cluster are avail-able on the ABBl website). to register to this Business Finance Forum, please send an email to: [email protected]
Crypto currencies
Crypto currencies and especially the Bitcoin have been heavily debated in financial circles throughout 2014. the ABBl has actively taken part in various working groups and liaised with new stakeholders that are entering the pay-ments market. the aim of ABBl’s ac-tions and activities was to explore new business opportunities for its members either by adopting crypto currencies in their service portfolio or teaming up with the new stakeholders. ABBl also welcomed CSSF’s communication on crypto currencies issued in February 2014.
FinTech
In october 2014, the Government of-ficially launched its “Digital lëtzebuerg
ABBL’s definition of FinTech
Fintech stands for innovation in financial services, covering new products/services offered by new start-ups, as well as the adoption of new methods by existing stakeholders and where new disruption technologies is the key player. Fintech covers the customer interaction and the internal financial services production domains.
25
SEPA & Security of Payment Instruments
payments via SepA Direct Debits. In 2014, more than 460 Creditor IDs were generated. Since 2011, 1,680 Creditor IDs were generated.
EPC - European Payments Council
In September 2014, the Board of Directors decided that ABBl will rep-resent the luxembourg Banking com-munity in the revised epC structure. A coalition between luxembourg, Switzerland, liechtenstein and Slovenia allows the luxembourg Banking Community to have a permanent seat on the future epC Board, having its work in March 2015.
SEPA Standards
At the same time, the Standards work-ing group of the ABBl payments Committee has developed XMl im-plementation guidelines for state-ments issued by banks for companies, and started work on XMl messages for account report and debit/credit notifications.
SEPA
having been successfully launched on 28 January 2008, the SepA project came to a conclusion in 2014 after finalising the migration of the legacy direct debits scheme to the new SepA Direct Debit schemes.
the Regulation 260/2012/eu estab-lishing technical and business require-ments for credit transfers and direct debits in euro mandating the migration in the euro area by 1 February 2014, was postponed to 1 August 2014.
Indeed, based on various euro area and national indicators, it was unlikely that the expectations communicated by the eurosystem in its first SepA mi-gration report, with regard to migration to the SDD schemes, would be met by the payments Services users (pSus) by 1 February 2014. with a transitional period of 6 months granted to payment Service providers and especially pSus (the creditors), the migration came successfully to the end; In fact, more than 95% of legacy direct debit trans-actions were moved to SepA Direct Debit transactions by 1 August 2014 in luxembourg. the remaining creditors will have time until 1 August 2015 to migrate their yearly direct debits.
During 2014, banks have provided significant help to their customers to use the most appropriate migration scenario, which have been developed in luxembourg and coordinated by ABBl in order to simplify the migra-tion process as much as possible for corporates.
NASO activities
the role of the ABBl as nASo (national Adherence Support organisation) is to give advice and coordinate the ad-herence to the epC schemes, SepA Credit transfer (SCt) and SepA Direct Debit (SDD) of the institutions that have not yet adhered, i.e. to provide support to banks and financial service provid-ers in order to correctly complete the SDD and SCt adherence forms.
At the end of 2014, 69 financial institu-tions had adhered to SCt, 24 to SDD Core and 14 to SDD B2B; in terms of SepA reachability via their parent com-panies, the figures are as follows: 92 for SCt, 33 for SDD Core and 17 for SDD B2B.
In its role as nASo, the ABBl has also set up a process in order to generate and manage SepA Creditor Identifiers, which are mandatory for creditors in order to allow them to collect
26
Security of payment systems and instruments
the security of payment systems and instruments is the base of trust cus-tomers are looking for when using electronic payment services and online channels.
the ABBl working group dealing with the security of payment systems and instruments continued to monitor the various threats and attacks detected.
As in 2013, in the first half of 2014 and until the holiday season, numer-ous phishing attempts were observed in luxembourg as well as in other european countries.
As cybercrimes are global phenome-na, it is of greatest importance to liaise with relevant national and european bodies uniting to fight these types of frauds. therefore, the ABBl is repre-senting its members in eBF and epC working bodies.
CurrentTrends Top 10 Threat Trends in Emerging Areas
Top Threats
Cyber-physical systems and Cip
mobile Computing
Cloud Computing
trust infrastr.
Big datainternet of
thingsnetwork
virtualisation
1. malicious code: worms/trojans
2. web-based attacks
3. web applica-tion attacks / injection attacks
4. Botnets 5. denial of
service
6. spam
7. phishing
8. exploit kits
9. data breaches 10. physical
damage / theft / loss
11. insider threat 12. information
lekage 13. identity theft /
fraud 14. Cyber
espionage 15. Ransomware
/ Rogueware / scareware
ENISA Threat Landscape 2014
Overview of current and emerging cyber-threats
tRends
Increasing
Stable
Dedining
Source: European Union Agency for Network and Information Security (ENISA)
27
Social Affairs
Finally, an employee whose employ-ment contract is terminated for eco-nomic reasons can request the benefit of an outplacement measure, whose terms and conditions are fixed between the employer and the staff delegation of the company in question.
the social partners have agreed on the crucial importance of training in the banking sector and have called upon the joint committee to update and re-form part I of the training agreement by 2016. the joint committee convened and began its review in november 2014.
In 2014, in matters of labour and employment, the Social Affairs Department was mainly involved in the renegotiation of the collective bargain-ing agreement for bank employees.
on 22 April 2014, after almost five months of negotiations, the ABBl and the three trade unions, AleBA, oGBl and lCGB, agreed on the terms of a collective bargaining agreement for bank employees for the years 2014 to 2016. the official signature of the new agreement took place on 15 May 2014.
Considering remuneration, the collec-tive bargaining agreement does not contain any increase in remuneration: no increase in scales, neither a financial arrangement for merit-based increas-es, nor any linear increases are stipu-lated in the agreement. the guarantee linked to seniority and the seniority allowance are frozen for all groups of the agreement, except for 2014.
From the year 2015 on, the seniority allowance will be structurally resched-uled. In future it will be payable under the conditions of 3, 5 and 8 years (instead of 1, 3 and 6 years formerly).
A small change has been made to the section on special leave: in case of death of a child, the social partners have agreed to extend the special leave granted in such case from three to five days.
An innovation in the collective agree-ment concerns training courses, as the banks have committed to set aside a training budget of at least 1% per year of the wage bill as defined by the agreement for employees under the scope of the collective bargaining agreement.
Another new feature of the collective bargaining agreement pertains to a whistleblowing procedure which com-panies have to put in place internally in accordance with CSSF circulars and provisions of the labour Code.
28
Employers’ Representation
during the first weeks of absenteeism has been introduced and the man-agement of this risk taken over by the employers’ Mutual Insurance.
Besides employers’ contributions, the luxembourg State intervenes in the financing of the employers’ Mutual Scheme through a contribution of 0.3% of the total taxable income.
As short term absenteeism rates don’t stop to grow, the necessity of find-ing long-term solutions to refund the upcoming deficit of the employers’ Mutual Insurance is key. this leads to the recent discussions in the em-ployers’ camp about demanding the strengthening of legal and financial means to enable an efficient manage-ment of absenteeism and, if neces-sary, financial means in order to per-mit, in the long run, the reduction of the employers’ Mutual Scheme’s deficit (see also the bipartite agreement of 14 January 2015 with the Government).
A final agreement could be found in the negotiations between the luxembourg employers’ Association (uel) and the Governement introducing e.g. a tem-porary average ceiling of 2% for the employers’ contributions in the Mutual Insurance as of 2016.
the ABBl, as an employers’ organi-sation, is defending the interests of employers in the field of social affairs, including sector-based tasks as well as tasks of general interest.
the representation of the ABBl mem-bers and the services provided to them are assured by position statements, censuses, consultations, one-off pres-entations and negotiations with the purpose of defending the interests of the financial sector against stakehold-ers in the political arena, such as min-istries, governments and trade unions.
In the field of social security, important political discussions were going on in 2014 about the growing rates of ab-senteeism and the financial impact on contribution rates for companies and the employers’ Mutual Scheme result-ing in the following statements:
the necessity of a better management of the individual absenteeism in companies
Since 2011, the observatoire de l’Absentéisme au travail, resulting from a collaboration between CepS/Instead, the General Inspectorate of Social Security and the high level Group of
Absenteeism, periodically delivers sta-tistics and develops series of indicators available to companies in order to state and improve their individual absentee-ism rates. these tools are considered as being very helpful
a need for administrative and medical reforms
Social partners were,via the health Fund, involved in 2014 in discus-sions on the draft bill about reforming the Social Security Institution called Medical Control (in charge of check ups on behalf of the health Fund for people on sickness leave). Both, trade unions and employers’representatives insist on a revision, harmonisation and acceleration of procedures via:
a legal clarification of competen-cies of the Medical Control within the period of continuation of salary,
the improvement and accelera-tion of procedures for people on long-term sickness, including the reclassification procedure.
the future financing of the employers’ mutual insurance (www.mde.lu)
Since the introduction of the Single Statute in 2009, the generalisation of the continuation of salary by employers
29
AGDL
In 2013, the credit institutions mem-ber of AGDl implemented the CSSF circular 13/555 introducing the “Single Customer View”. In 2014 these credit institutions confirmed to AGDl and CSSF that their single Customer View System was fully operational. the sec-retariat of AGDl is still at the disposal of the members to provide assist-ance to them in the application of the circular.
on April 16th 2014 the eu Directive on Deposit Guarantee Schemes was finally published. AGDl is now look-ing forward to prompt implementation in national law, which is deemed to be done before July 3rd 2015.
More details about the AGDl can be found on the ABBl website.
AGDl (Association pour la Garantie des Dépôts luxembourg asbl) is the luxembourg Deposit Guarantee Scheme as well as the luxembourg Investor Compensation Scheme. Its purpose is to set up, in accordance with the law and the european direc-tives, a mutual guarantee scheme cov-ering cash deposits of the customers of credit institutions and claims arising out of investment transactions in fa-vour of investors with credit institutions and investment firms.
ABBl and AGDl are two separate and autonomous organisations, but since the creation of AGDl, in 1989, both associations were always close-ly linked, particularly - but not only, through a service level agreement en-trusting the day-to-day administrative work of the AGDl to the secretariat and staff of ABBl.
up to now, AGDl intervened 5 times in its function as Deposit Guarantee Scheme (one in support of the ger-man DGS). the last intervention was
on october 9th 2008 with Kaupthing Bank luxembourg S.A.
Four of these files are definively closed:
Bank of Credit and Commerce International S.A (BCCI),
BFI Bank luxembourg- niederlassung der BFI Bank AG Dresden,
Glitnir Bank luxembourg S.A.,
landsbanki luxembourg S.A.
the file of the failure of Kaupthing Bank luxembourg S.A. is still in progress.
In July 2009, Kaupthing Bank luxembourg S.A was splitted in two parts: 1) pillar Securitisation SARl, taking over the debts of Kaupthing and 2) a new Bank “Banque havilland SA” taking over the customers of Kaupthing with their deposits. Since August 2009, the recovering proc-ess has begun and AGDl receives 4 times a year a reimbursement. this will continue in 2015.
30
IFBL - l’Institut
Compliance, organised jointly with the Association luxembourgeoise des Compliance Officers (AlCo) continued to rise, reaching a record level of 1,000 man-days of training. the 1,000 man-day mark was also achieved for the first time in the field of Risk Management, where training courses, organised in cooperation with the Association des Professionnels du Risk Management (AlRiM), were well attended.
In the field of investment fund training, the programme developed in coopera-tion with the Association luxembour-geoise des fonds d’investissement (AlFI) has been reviewed and sup-plemented by the addition of several modules in english, thereby respond-ing to the ever increasing need of english-speaking clients. For capital markets, the ‘Capital Markets Back-office Certificate’ (CAMBoC) has been supplemented by a Master’s level programme, providing a complete overview of Back office transactions on international financial markets. In the field of Retail and Corporate Banking, 23 participants took the final examination and were awarded the title of Certified Retail Client Advisor and Certified Corporate Client Advisor.
the financial sector, as a driving force of the luxembourg economy, continues at present to reinvent itself and adapt to the procedures imposed by the new regulatory frameworks as well as an environment subject to ever-increasing change. this new environment leads to the need for new profiles, even new professions and, probably more than ever, the IFBL - l’Institut must therefore adapt, diversify and expand its range of services in order to satisfy these new requirements.
In 2014, the Institute received a record number of registrations and provided a wide range of training courses; over 13,200 man-days of training. this in-crease was noted in ‘à la carte’ cours-es, allowing participants to register for individual modules which meet their needs, as well as in certificate courses, which consist of a series of modules leading to the award of a certificate.
‘À la carte’ courses: steady cruising speed
overall, IFBl offers about 450 differ-ent course modules, grouped in 14 main themes. For this type of training, close to 4,000 man-days of training were provided in 2014; a record for the Institute since it started measuring its attendance rates in terms of man-days. Currently, courses related to ‘financial and banking products’ are the most popular, followed by the modules related to financial culture.
Certifications: a diversified and relevant programme
In general, the certificate programmes offered in conjunction with the profes-sional associations representing the financial centre, have been further adapted in 2014, demonstrating the will of the participants and their em-ployers to promote and award certifi-cates for knowledge acquired.
As in previous years, training directly or indirectly related to the regulatory and supervisory environment of the financial marketplace has witnessed net increases. Furthermore, in 2014, the demand for training in the field of
31
Career and personal development
Since 2010, the Institute has broad-ened the range of its services by pro-viding, in addition to the training it of-fers, measures and actions in the area of “Career and personal development”. this approach is primarily aimed at companies looking for solutions re-garding the guidance, support and supervision of their employees. In ad-dition, the IFBl also supports initiatives launched by the Ministry of labour and the employment Administration (ADeM) in connection with the national aim to combat unemployment. thus, the Institute ran nine cycles of the “Fit4Financial Markets” programme between 2010 and 2014, accom-modating 453 candidates in total, of which 132 attended in 2014 alone.
The House of Training
on 5 november 2014, during a joint press conference, the luxembourg Chamber of Commerce and the luxembourg Bankers’ Association (ABBl) announced their intention to merge their two respective training institutes (lSC and IFBl) into a new entity called the ‘house of training’. It was set up to explore the possible synergies at the level of transversal training in order to optimise training programmes and overall quality. this new entity will offer a broader range of programmes to a large audience in the banking and financial sector as well as businesses in other sectors of the luxembourg economy.
32
Luxembourg Agenda of Financial Sector Dossier
leGISlAtIVe wAtCh
Concerning the legislative watch, the following draft laws in progress should be noted:
Draft Law No 6769 introducing the extraju-dicial settlement of consumer disputes to the Consumer Code and amending certain other provisions of the Consumer Code.
Submittedon16January2015
DraftLawNo6769 is intendedtoensureac-cess to simple, effective, swift and uncom-plicated means of resolution of national andcross-borderdisputes resulting fromthesaleofgoodsorservices.Thisaccess,whichwillbeaffordedviaanEIGtobecreated,willbeequally applicable to online and traditionaltransactions.Thedraftlawintroducesthepos-sibilityofextrajudicialsettlementofdisputeforbothconsumersandprofessionals,whomayalsohaverecoursetothemechanism.
Draft law No 6763 amending the Code of Criminal procedure and the amended law of 30 May 2005 concerning the protection of privacy in the electronic communications sector.
Submittedon7January2015
ThepurposeofdraftLawNo6763istoadaptthe legalmechanism relating to the retentionof telecommunicationsdata for thepurposesoflegalproceduresundertherequirementsofthejudgmentoftheEuropeanCourtofJusticeon8April2014,knownas‘DigitalRights’(jointcases C-293/12 and C-594/12), whereby theCourt invalidated Directive 2006/24/EC of15 March 2006 on the retention of personaldata for the purposes of preventing, inves-tigating, detecting and dealing with seriousoffences.
Draft Law No 6718 concerning the report on payments made to governments and amending various provisions relating to the accounting and annual accounts of enterprises, as well as to the consolidated accounts of certain types of com-panies and
transposing Directive 2013/34/eu of the european parliament and of the Council of 26 June 2013 on the annual financial state-ments, consolidated financial statements and related reports of certain types of undertak-ings, amending Directive 2006/43/eC of the european parliament and of the Council and repealing Council Directives 78/660/eeC and 83/349/eeC;
amending – title II of the amended law of 19 December 2002 on the register of com-merce and companies as well as the account-ing and annual accounts of undertakings; – the amended law of 10 August 1915 on Commercial Companies; – title II of Book l of the Commercial Code
Submittedon15September2014
Opinion of the Association of CharteredAccountants(OEC),8December2014
OpinionoftheInstituteofCompanyAuditors,20January2015
Draft Law No 6718 is intended to transposeintonational lawDirective2013/34/EUof theEuropean Parliament and of the Council of26 June 2013 on the annual financial state-ments,consolidated financialstatementsandrelated reports of certain types of undertak-ings, amending Directive 2006/43/EC of theEuropeanParliament andof theCouncil andrepealingCouncilDirectives78/660/EECand83/349/EEC.ThisDirective introducesanew
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obligationregardingthetransparencyofpay-mentsmadebyundertakingstogovernments,anobligationgenericallyreferredtoas‘coun-try-by-countryreporting’,whoseaim–inthisprecise context – is to combat corruption innon-EU countries rich in natural resources.Furthermore, the draft law introduces somechangesessentiallyguidedbyconsiderationstending to reduce the administrative burdenforsmallcompanies.
Draft Law No 6675
organising the State Information Service;
amending the amended law of 22 June 1963 establishing the regime for the remuneration of State functionaries; the law of 31 May 2005 on the specific provisions for the protection of individuals with regard to the processing of personal data in the field of electronic commu-nications; the Code of Criminal procedure; the amended law of 2 August 2002 on the protec-tion of individuals with regard to the processing of personal data, and the law of 15 June 2004 on the classification of documents and security clearance;
repealing the law of 15 June 2004 organising the State Information Service.
Submittedon2April2014
OpinionoftheChamberofCommerce,6October2014
Governmentalamendments,24October2014
OpinionoftheCouncilofState,19December2014
DraftLawNo6675isintendedtodefineanewlegalframeworkfortheoperationoftheState
Intelligence Service (‘SIS’). With this goal inmind,newprovisionswere introducedwithaview to establishing procedures for informa-tiongatheringoperationsinitiatedbytheSIS.The measures provided for include researchmeasuressubjecttointernalauthorisation(i.e.simple authorisation from the Director of theSIS)andresearchmeasuressubjecttoexter-nalauthorisation(i.e.bydecisionofaministe-rialcommittee).Concerningbanks,themeas-uresprovidedforinthedraftlawareintended,inparticular,toenablethesurveillanceofpub-lic places, including banking establishments,sincetheyareconsideredto‘constitutepublicspace’. Moreover, the draft law enables theSIStoaskbankingorganisationsfor informa-tionrelatingtobankingtransactionsconduct-edoveradeterminedperiod,inrespectofoneormorebankaccounts,byapersonwhoisthesubjectofaninformationgatheringmeasure.
Draft Law No 6660
transposing Directive 2013/36/eu of the european parliament and of the Council of 26 June 2013;
partially transposing Directive 2011/89/eu of the european parliament and of the Council of 16 november 2011;
transposing Article 5, paragraph 6 of Directive 2011/61/eu of the european parliament and of the Council of 8 June 2011;
amending the amended law of 5 April 1993 on the financial sector; the amended law of 23 December 1998, creating a financial sector monitoring commission, and the law of 12 July 2013 on managers of alternative investment funds.
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Submittedon28February2014
OpinionoftheEuropeanCentralBank,26June2014
OpinionoftheChamberofCommerce,15September2014
OpinionoftheCouncilofState,21October2014
DraftLawNo6660isintendedtotransposeintoLuxembourg law the provisions of Directive20l3/36/EU, commonly known as ‘CRD IV’.Moreover, it repeals the legal provisions thatwillfromnowonduplicateRegulation(EU)No575/2013, which, together with the Directiveconstitutes theEuropean legal framework forthe approval and prudential supervision ofcredit establishments and investment firms,without prejudice to the applicable provi-sionsofDirective2004/39/EC.ItalsorepealsDirectives 2006/48/EC and 2006/49/EC,whichwere transposed in theLawof5April1993onthefinancialsectorandintheCSSFcirculars,tociteonlythemostsignificant,i.e.CSSF circulars 06/273 and 07/290, althoughthese provisions have not been repeated intheDirective.DirectiveCRD IVand theCRRRegulation essentially involve changes at aprudential level and in terms of the govern-anceofcreditestablishmentsandinvestmentfirms.Thenewprudentialregimeaimstotakeon board the recommendations made in theBaselIIIagreementsadoptedtoensurethefi-nancialsolidityofestablishmentsbyimposingsolvency ratios and additional requirementsrelating to own funds, as well as by imple-mentingconstraintsonliquidity.Furthermore,the CRD IV Directive reinforces the rules onaccesstobankingactivityandintroducesnewrulesonremunerationpolicy.
Draft Law No 6653 creating a systemic risk committee and amending the amended law of 23 December 1998 on the monetary status and the Central Bank of luxembourg
Submittedon28February2014
OpinionoftheChamberofCommerce,2April2014
OpinionoftheCouncilofState,20May2014
OpinionoftheEuropeanCentralBank,26June2014
The purpose of the draft Law is to imple-ment inLuxembourg the recommendationoftheEuropeanSystemicRiskBoard(ESRB)of22 December 2011 concerning the macro-prudential mandate of national authorities,which calls for Member States to implementanationalmacro-prudentialauthority,andtheESRB recommendation of 4 April 2013 onintermediateobjectivesandmacro-prudentialinstruments.
Draft Law 6595 on patrimonial foundations and amending the:
amended law of 4 December 1967 on income tax;
amended law of 16 october 1934 on wealth tax;
amended law of 1 December 1936 on com-mercial tax;
amended law of 31 May 1999 governing the domiciliation of companies.
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Submittedon22July2013
OpinionoftheCouncilofState,29April2014
Amendments adopted by the Finance andBudgetCommission,5June2014
Additional opinion of the Council of State,7October2014
Finance and Budget Commission report,3November2014
ThedraftlawintroducesintoLuxembourglawan orphan structure called the ‘patrimonialfoundation’, which will supplement the cor-porateor contractual schemes (e.g. fiduciarycontracts, insurance contracts, etc.) com-monlyusedforstructuringandplanningpatri-monialandsuccessionissues.InordertotakeintoaccounttherequirementsofFAFTandtheGlobalForumonTransparencyandExchangeofInformationforTaxPurposes,thedraftLawincludespreciseobligationsconcerningiden-tificationof thebeneficialownersofpatrimo-nialfoundations,theavailabilityandstorageofinformationrelatingtothisidentificationandtothe accounting documents and cooperationwiththerelevantauthorities.
Draft Law No 6543 on electronic archiving and amending the amended law of 5 April 1993 on the financial sector
Submittedon13February2013
OpinionoftheChamberofCommerce,22May2013
OpinionoftheChamberofTrades,14June2013
OpinionoftheCouncilofState,8October2013
Amendment adopted by the Commission fortheEconomy,20October2014
The main objectives of the draft law are tomodernise the rules relating to the digitisa-tionofcertaindocumentsandtheirarchivingindigitalform,aswellastocreateanewtypeofserviceproviders inthefieldofdigitisationand archiving. In particular, the draft law in-tendstorecognisethelegalforceofdigitiseddocuments and, under certain conditions,deemthemtruetotheoriginal,andtoestab-lishahighlevelofrequirementsinordertoen-surethatthedigitisedarchivesarereliableandsustainable.
Draft Law No 6539 on business preservation and modernisation of bankruptcy law
Submittedon1February2013
OpinionoftheLuxembourgDistrictCourt,14March2013
OpinionoftheLuxembourgStateProsecutor,18March2013
Opinion of the Diekirch State Prosecutor -DispatchfromtheDiekirchStateProsecutortotheGeneralStateProsecutor,18March2013
OpinionoftheChamberofEmployees,23April2013
OpinionoftheDiekirchDistrictCourt,30May2013
OpinionofthePublicProsecutor,28June2013
DispatchoftheStateProsecutortotheMinisterofJustice,8July2013
OpinionoftheCounciloftheOrderoftheBarofLuxembourg,8August2013
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OpinionoftheAssociationofCharteredAccountants,3October2013
OpinionoftheChamberofTrades,10October2013
OpinionoftheChamberofCommerce,2December2013
OpinionoftheChamberofCivilServantsandPublicEmployees,13October2014
ThepurposeofdraftLawNo6539istocreatea number of measures intended to preservebusinesses and modernise bankruptcy law.Thedraftlaw,whichmainlydrawsonBelgianlaw,comprisesanumberofcomponents:pre-ventive and remedial, as well as repressiveandsocial.Thepreventivecomponentaimstoavoid the inevitability of bankruptcy for busi-nesses in difficulty. The remedial componentmust enable traders of good faith to have asecondchanceandcontributetothecreationof a more propitious environment for a newstart.Therepressivecomponent,ontheotherhand,mustensurethatplayersofbadfaitharenotpermittedtoshirktheirresponsibilitiesandsubsequentlyrelapse.
Draft Law No 6054 on non-profit associations and foundations
Submittedon10June2009
OpinionoftheInstituteofCompanyAuditors,21September2009
OpinionoftheAssociationofCharteredAccountants,12October2009
Jointopinionofvariousassociations,21October2009
OpinionoftheChamberofEmployees,10November2009
OpinionoftheNationalCouncilforForeigners,24November2009
OpinionoftheUnionSaintPieX,14January2010
Joint opinion of the Chamber of CommerceandtheChamberofTrades,5March2010
Jointopinionof theGreenpeaceFoundation,the Hëllef fir d’Natur Foundation and theÖkoFondsFoundation,11March2010
The main reforms of this draft law may besummarisedasfollows:
Removaloftheobligationtosubmitanannuallistofthecurrentmembersofthenon-profitassociation.Thisobligationwillbereplacedby the establishment of a register of mem-bers,whichtheassociationmustkeepatitsheadquarters,whereitmaybeconsultedbyallmembers(andthirdparties).
Relaxation and clarification of the approvalregimefortheliberalityinfavourofanasso-ciationorafoundation,asprovidedforintheLawof19December2008amending,amongothers,theamendedLawof21April1928onnon-profitassociationsandfoundations.
Implementation of a simple but completeregime for the publication and third-partyeffectiveness of documents issued byassociations and foundations, replacing thesparseprovisionsofthe1928law.
Thedraftlawalsoproposesthatallinforma-tion be centralised in a file for each asso-ciationandfoundationkeptinthetradeandcompanies register, the contents of whichmaybeconsultedby thirdparties,whowillbeabletoaskforacopythereof.
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Introduction of complete regulations oninvalidregimesandthedissolutionofasso-ciationsandfoundations,replacingthesum-maryprovisionsofthecurrent1928law.
RemovaloftheformalCivilTribunalapprov-al procedure for statutory amendments orevenforthedissolutionprocedureforasso-ciations,ascurrentlyprovidedforunderthe1928law.
Draft Law No 5730 modernising the amend-ed law of 10 August 1915 on Commercial Companies
Submittedon8June2007
OpinionoftheInstituteofCompanyAuditors,3March2008
OpinionoftheChamberofCommerce,12February2009
AmendmentsadoptedbytheLegalCommissionoftheChamberofDeputies,7May2009
OpinionoftheCouncilofState,23February2010
Examination of the draft law by the LegalCommission of the Chamber of Deputies,September–December2014
The fundamentalobjectiveof thedraft law istocompletethemodernisationofLuxembourgcompany law initiated by the Law of25 August 2006 on the European Company,theS.A.companywithmanagementboardandsupervisoryboardandtheS.A.companywithasingleshareholder,aswellasbytheLawof23March2007amending:
1. the amended Law of 10 August 1915 oncommercialcompanies;
2.theLawof19December2002onthetradeand companies register and the accountingand annual accounts of undertakings, andamendingcertainotherlegalprovisions;
3.theLawof25August2006ontheEuropeanCompany, the S.A. company with manage-ment board and supervisory board and theS.A. companywitha single shareholder, andtheLawof23March2007amendingArticles271,273bisand276of theamendedLawof10 August 1915 on commercial companies,bothofwhich reform thematterofcompanymergersanddivisions.Theaimthereofis,es-sentially,toextendrecoursetotheserestruc-turing techniques toall companieswith legalpersonality and introduce techniques for thepartial transfer of assets, universal transfersand diversification, as well as the transfer ofprofessionalassetsandtoenableacompanygoverned by Luxembourg law to merge withacompanygovernedbyforeignlaw,providedthenationallawofthelatterdoesnotopposethismove.
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dossier next steps
financial market Regulation
UCITS V state-of-play: published in the official Journal published in the official Journal l 257 of 28 August 2014. level 2: eSMA sent its final advice on 28 november 2014.
CommissionexpectedtoadoptdelegatedactsondepositoriesbyendApril/May2015.
UCITS VI state-of-play: waiting for legislative proposal on hold Commission: Consultation by the Commission services ended on 18 october 2012. Adoption of legislative proposals not explicitly mentioned in the 2015 work programme. the Commission has tackled the issue of long-term investment in the eltIF regulation, agreed upon in December 2014, and the issue of Money Market Funds in a proposal published on 4 September 2013.
European Long-Term Investment Funds Regulation (ELTIF)
state-of-play: trilogue deal approved Commission: proposal for a Regulation published on 26 June 2013. trilogue: the trilogue deal of 26 november 2014 has been approved by the Council on 17 December 2014. the european parliament adopted its first reading position on 10 March 2015, paving the way for formal adoption by the Council on 20 or 21 April 2015 and publication in the official Journal of the eu in mid-May 2015.
MiFID and MiFIR state-of-play: published in the official Journal published in the official Journal l 173 of 12 June 2014. level 2: eSMA has published its final technical advice on 19 December 2014. Comments on eSMA’s consultation were published on 10 March 2015.
Central Securities Depositories Regulation
state-of-play: published in the official Journal published in the official Journal l 257 of 28 August 2014.
Transparency of Securities Financing Transactions
state-of-play: legislative phase Commission: proposal published on 29 January 2014. european parliament: work started during the previous legislature. the last draft report was presented in committee on 21 January 2015. Amendments were considered on 23 February. the committee vote is set on 23 March, and the plenary vote in April 2015. Council: A general approach has been agreed upon on 14 november 2014.
Alternative Investment Fund Managers Directive (AIFMD)
state-of-play: entered into force published in the official Journal l 174 of 8 June 2011. level 2: Application of the directive and the delegated acts: 22 July 2013. eSMA’s opinion and advice on AIFMD pass-port and third country AIFMs is expected by 22 July 2015.
Money Market Funds Regulation
state-of-play: legislative phase Commission: In the framework of its work (and G20 workstream), the Commission published a proposal for a regulation on Money Market Funds on 4 September 2013. european parliament: work has started in the last legislature. the draft report was voted on 26 February 2015 in eCon Committee. the plenary vote is expected to be held in April 2015. Council: the work started in July 2014. last working Group: 1 December 2014. last presidency Compromise: 17 December 2014.
European Agenda of Financial Sector Dossier
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dossier next steps
financial market Regulation
Packaged Retail Investment Products (PRIPs)
state-of-play: published in the official Journal published in the official Journal l 352/1 of 9 December 2014. level 2: the Commission sent a mandate to eIopA for advice on delegated acts on 30 July 2014. A call for expression of interest for a Consultation expert Group on Key Information Documents (KIDs) has ended on 15 December 2014. Submission of comments on eSAs’ Discussion paper on KIDs ended on 17 February 2015. eIopA’s consultation on product Intervention power ended on 27 February 2015.
AsecondESMAconsultationisexpectedinspring2015.
Indices used as Benchmarks
state-of-play: legislative phase Commission: the Commission’s proposal has been published on the 18 September 2013. european parliament: work started in the last legislature. the last draft Report was presented on 8 January 2015. Amendements were considered on 26 February. the committee vote is scheduled on 9 March 2015. Council: A negotiating position has been agreed upon on 13 February 2015.
Framework for a Capital Markets Union (CMU)
state-of-play: green paper consultation launched Commission: Green paper issued for consultation on 18 February 2015. A conclusive Conference will be held in June 2015. the publication of an Action plan is announced by September 2015. european parliament: An exchange of views with Commissioner hill was held on 24 February 2015.
Review of the Prospectus Directive (CMU)
state-of-play: Consultation launched Commission: A Consultation was launched on 18 February and will end on 13 May 2015.
European Framework for Highquality Securitisation (CMU)
state-of-play: Consultation launched Commission: A Consultation was launched on 18 February and will end on 13 May 2015.
Resolution and recovery for non-banks (CMU)
state-of-play: waiting for legislative proposals Commission: Commission officials have stated that a proposal on resolution of CCps will be tabled in autumn 2015. whether a proposal concerning other non-bank institutions would be tabled at the same time or later is still to be decided. european parliament: the european parliament has adopted an own Initiative Report on Recovery and Resolution for non-Banks on 10 December 2013.
Creating a EU covered bond frame-work (CMU)
state-of-play: waiting for consultation document Commission: the publication of a dedicated Green paper has been announced.
Banking supervision
Reform of banking structure
state-of-play: legislative phase Commission: proposal published on 29 January 2014. european parliament: the draft report on the legislative proposal was tabled on 22 December 2014 and discussed on 21 January 2015. Amendments were tabled on 3-4 February and were discussed on 23 February. the committee vote was set on 23 March, the plenary vote is set in April 2015. Council: work has started in May 2014. last working Group: 13 February 2015.
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dossier next steps
tax
Common consoli-dated corporate tax base
state-of-play: legislative phase Commission: legislative proposal on 16 March 2011. A renewed proposal could be part of the second tax transparency package to be announced in June 2015 (as stated by Commissioner for taxation p. Moscovici during the presentation of the first package on 18 March 2015). european parliament: legislative resolution (non-binding opinion) adopted in plenary on 19 April 2012. Council: last working Group: 12 March 2015.
Savings Tax Directive state-of-play: published in the official Journal published in the official Journal l 111 of 15 April 2014.
Administrative coop-eration in tax matters Directive
state-of-play: published in the official Journal published in the official Journal l 359 of 16 December 2014.
Mandatory exchange of information on tax rulings
state-of-play: legislative phase Commission: proposal published on 18 March 2015.
Financial Transaction Tax (enhanced cooperation)
state-of-play: negotiations in enhanced cooperation procedure in the Council Commission: the new legislative proposal was published on 14 February 2013. In early December 2013 the Commission published a non-paper to answer the Council’s legal opinion (see below). european parliament: Gave its consent to enhanced cooperation on 12 December 2012. the opinion on the legislative proposal was voted in plenary on 2 July 2013. Council: examination of the proposal is still going-on at the working group level and among the 11 participating Member States. the proposal was on the agenda of the eCoFIn Council on 7 november and on 9 December. no consensus has been found yet. eCJ: on 18 April 2013 the uK Government lodged a formal legal claim at the european Court of Justice against the introduction of the eu Ftt under the enhanced Cooperation procedure. this claim is based on the grounds that the existing proposal will impact countries not taking part to the initiative. the Court rejected the claim on 30 April 2014.
payment systems & iCt
Green Paper on Payment (cards, mobile, internet)
state-of-play: waiting for legislative proposal Commission: published on 11 January 2012 a Green paper and a consultation (deadline April 2012). A public hearing took place on 4 May 2012. proposals published on 24 July together with a proposal on MIFs. the Commission is cur-rently reflecting on mobile payments and considering action on this issue in the course of 2015. european parliament: Initiative report adopted on 20 november 2012.
Payment Service Directive
state-of-play: legislative phase Commission: the Commission published the proposal on 24 July 2013. european parliament: A first reading position was adopted in plenary on 3 April 2014. Council: A general approach has been adopted on 1 December 2014. luxembourg does not support it. trilogue: next trilogues: end of March 2015.
Multilateral Interchange Fees
state-of-play: trilogue deal approved Commission: the Commission published the proposal on 24 July 2013. trilogue: the trilogue deal of 17 December 2014 has been approved in Coreper on 21 January 2015. the european parliament adopted its first reading position on 10 March 2015, paving the way for formal adoption by the Council and publication in the coming months.
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dossier next steps
legal
Anti-money launder-ing directive
state-of-play: trilogue deal approved Commission: proposal for a 4th directive published on 5 February 2013. trilogue: the trilogue deal of 16 December 2014 has been approved in eCon committee on 27 January 2015. the Council adopted its first reading position on 10 February 2015, paving the way for formal adoption by the european parliament in second reading and publication in the coming months.
Data protection state-of-play: legislative phase Commission: publication of the proposal for a regulation on 25 January 2012. european parliament: A first reading position was adopted in plenary on 13 March 2014. Council: working Group work on-going and exchanges of views at Ministerial level. A partial General Approach was approved by the Council on 13 March 2015.
Client protection & Consumer Rights
Investor Compensation Scheme Directive
state-of-play: withdrawn Commission: Due to a political stalemate since 2011 and in a spirit of “Better Regulation”, the Commission withdrawn its proposal on 7 March 2015.
Deposit Guarantee Schemes Directive
state-of-play: published in the official Journal published in the official Journal l 173 of 12 June 2014.
Payment accounts Directive: Directive on the comparabil-ity of fees related to payment accounts, payment account switching and access to payment accounts with basic features
state-of-play: published in the official Journal published in the official Journal l 257 of 28 August 2014. level 2: the consultation on the most representative services ended on 9 February 2015.
last update: 24 March 2015
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