Deal in sight to break Lamfalussy deadlock

Date: 19/07/01

THE European Commission is edging towards a deal with MEPs over Parliament's demands for the right to scrutinise reforms to securities markets.

Financial services chief Frits Bolkestein and select MEPs on the Parliament's economic and monetary affairs committee (EMAC) held another round of closed-door meetings in Strasbourg earlier this month in a bid to bridge the gap between the sides.

The MEPs have complained they were being denied a formal say in the fine-tuning of financial services legislation which will be made by a special committee of national experts.

But the Commission has refused to bow to demands for a formal 'call-back' if the committee makes proposals the assembly does not like, saying this would breach EU rules.

So far the talks have been cloaked in secrecy, with MEPs told by officials not to spill details for fear they might harm negotiations. "There is a news blackout on this," said Philip Todd, a member of the EMAC secretariat.

But a British MEP revealed that Bolkestein has made fresh proposals which could break the deadlock by promising to give members more powers of oversight. "We are all meant to stay quiet on this. But basically he came up with some new proposals," said the MEP who refused to be named. "[The Commission] has begun to move. There is no doubt that this is being treated as a serious step forward."

The controversial committee system is the linchpin of Baron Alexandre Lamfalussy's report on reforms to EU securities markets. Lamfalussy said national financial markets experts, together with Commission officials, were the best people to flesh out the details of Union legislation aimed at replacing complex national laws with a pan-EU system by 2003.

The special committee is already slated to work on two draft directives, covering prospectuses for cross-border share issues and market abuse.

The European Commission is edging towards a deal with MEPs over Parliament's demands for the right to scrutinise reforms to securities markets.