Distance banking proposals attacked

Date: 08/02/01

THE Swedish presidency is bowing to French, Italian and Belgian-inspired plans to water down draft rules governing the online marketing of financial services that European bankers say would let member states protect their domestic market leaders.

Original proposals, unveiled by the European Commission and backed by MEPs, seek to harmonise regulations to help boost the fledgling EU market for electronic banking, insurance and pensions. But a compromise tabled by Stockholm would allow member states to require foreign firms to provide additional details about their products to consumers - a move that critics claim would create undue regulatory burdens.

Frédéric de Brouwer, an e-commerce expert with the Brussels-based European Bankers Federation, says the changes would be "a step backwards" from the original proposals, if adopted.

Critics claim the additional red tape could discourage companies from using the Internet to deliver cheap and efficient financial services to Union citizens.

'Distance selling' proposals are producing tension between some member states and the EU executive over the way single market rules should be applied.

But internal market chief Frits Bolkestein was this week finalising a paper which re-emphasises harmonising 'country of origin' rules.

The Swedish presidency is bowing to French, Italian and Belgian-inspired plans to water down draft rules governing the online marketing of financial services that European bankers say would let Member States protect their domestic market leaders.