The EU leaders approved a 10-year plan to boost the 27-nation bloc’s competitiveness. The European Council also agreed to disclose the results of ongoing stress tests by banking supervisors in the second half of July.
Regulating financial services
The necessary reforms to restore the soundness and stability of the European financial system must be completed urgently. The resilience and transparency of the banking sector must be ensured. Progress in the next few months is essential. The European Council agrees that the results of ongoing stress tests by banking supervisors will be disclosed at the latest in the second half of July. The Commission's communication on "Regulating Financial Services for sustainable growth" of 2 June 2010 sets out a comprehensive list of initiatives to be undertaken and completed before the end of 2011. The EU must demonstrate its determination to bring about a safer, sounder, more transparent and more responsible financial system.
In particular, the European Council:
a) calls on the Council and the European Parliament to rapidly adopt the legislative proposals on financial supervision to ensure that the European Systemic Risk Board and the three European Supervisory Authorities can begin working from the beginning of 2011;
b) calls for agreement on the legislative proposal on alternative investment fund managers before the summer and for the swift examination of the Commission's proposal on the improvement of the EU's supervision of credit rating agencies;
c) looks forward to proposals announced by the Commission on derivative markets and in particular appropriate measures on short selling (including "naked" short selling) and credit default swaps.
The European Council agrees that Member States should introduce systems of levies and taxes on financial institutions to ensure fair burden-sharing and to set incentives to contain systemic risk.1 Such levies or taxes should be part of a credible resolution framework. Further work is urgently required on their main features and issues of level playing field and cumulative impacts of various regulatory measures should be carefully assessed. The European Council invites the Council and the Commission to take this work forward and report back in October 2010.
The Union's response to the crisis must continue to be coordinated at the global level to ensure that measures are internationally consistent. The action it is taking to boost competitiveness, consolidate public finances and reform its financial sector will enable it to put forward strong positions for similar international action at the forthcoming G20 Summit.
The EU should lead efforts to set a global approach for introducing systems for levies and taxes on financial institutions with a view to maintaining a world-wide level playing field and will strongly defend this position with its G20 partners. The introduction of a global financial transaction tax should be explored and developed further in that context.
With a view to the Toronto Summit, the European Council confirms the orientations agreed by the Council and reflected in the Terms of Reference prepared for the Busan Ministerial Meeting. Given the major risks that late exit from extraordinary fiscal stimulus would entail for public accounts' sustainability, the G20 should agree on a coordinated and differentiated exit strategy to ensure sustainable public finances. All major economies need to do their part to achieve the agreed objective of a strong, sustainable and balanced growth. The G20 must reaffirm its commitment to the reform of the financial system and make rapid progress in a consistent and coordinated manner on the whole range of actions agreed upon in Pittsburgh, to strengthen the resilience and transparency of our financial system, including through better quality additional capital and new liquidity buffer. In the IMF, quotas should be reviewed as part of a wider package of IMF governance issues, covering all elements agreed in Pittsburgh and Istanbul, and be completed, as a single and comprehensive package by November 2010.
© European Council
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EU summit conclusion - 17.06.10.pdf
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