04 April 2013

EPC: late movers: learn to love SEPA. There are ten months left to meet the 1 February 2014 migration deadline

The only party empowered to change the 1 February 2014 deadline is the EU legislator. The EU legislator has never indicated that it would consider such a motion. Consequently, there is only Plan A: get ready for SEPA in the euro area within the next ten months.

The European Parliament adopted the 'Regulation (EU) No 260/2012 establishing technical and business requirements for credit transfers and direct debits in euro', (the SEPA Regulation), on 14 February 2012. The Council of the EU representing EU Member States adopted this legislative act on 28 February 2012. The SEPA Regulation was published in the Official Journal of the EU on 30 March 2012 and came into force on 31 March 2012. Article 6 (1) and (2) of the SEPA Regulation mandates that credit transfers and direct debits shall be carried out in accordance with the relevant requirements set out in Article 5 and in the Annex to the Regulation by 1 February 2014, subject to certain limited exemptions mentioned in the Regulation. Effectively, this means that as of this date, existing national euro credit transfer and direct debit schemes in the euro area will be replaced by SEPA Credit Transfer (SCT) and SEPA Direct Debit (SDD). As mentioned above, there are no indications whatsoever that the EU legislator would consider changing Article 6 - the provision which defines the compliance date applicable in the euro area - of the SEPA Regulation.

Postponement of the 1 February 2014 deadline would counteract the expectations articulated by the lawmakers that meeting that date will generate significant benefits for consumers and businesses and contribute to further strengthening the common currency.

The EPC develops, among other things, the SCT and SDD Schemes which help to realise the integrated euro payments market. The EPC is not an EU legislative body. More generally, the EPC is not part of the EU institutional framework. The EPC is therefore not in a position to change the 1 February 2014 deadline mandated with EU law. It is the view of the EPC that the legally binding migration deadline provides planning security to all market participants and should not be postponed.

On 21 March 2013 the European Central Bank (ECB) published its first SEPA Migration Report (see link below). According to the related ECB press release, the report "shows that most corporations have already completed the planning phase and know what SEPA will mean for them in practical terms. However, when it comes to the actual implementation, a number of companies have adopted very late internal deadlines, even as far as to the end of 2013. (...) More worryingly, Small and Medium Enterprises' (SMEs) and local public administrations' awareness of SEPA is still fragmented and the level of preparedness is rather poor."

Organisations now working towards achieving compliance with the SEPA Regulation are invited to take advantage of the numerous resources offered by the banking industry and other service providers to support market participants during the transition. Relevant information is also made available with 'The EPC Migration Tool Kit'. In addition, the EPC offers best practice identified by early movers on the demand side who successfully completed migration to SCT and SDD.

 

Full report

Press release

Full article

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