<p margin-bottom="0pt" margin-left="70.9pt" margin-right="0pt" margin-top="0pt">on the proposal for a regulation of the European Parliament and of the Council on cross-border payments in the Community</p>

DRAFT EUROPEAN PARLIAMENT LEGISLATIVE RESOLUTION

on the proposal for a regulation of the European Parliament and of the Council on cross-border payments in the Community

(COM(2008)0640 – C6‑0352/2008 – 2008/0194(COD))

(Codecision procedure: first reading)

The European Parliament,

– having regard to the Commission proposal to the European Parliament and the Council (COM(2008)0640),

– having regard to Article 251(2) and Article 95(1) of the EC Treaty, pursuant to which the Commission submitted the proposal to Parliament (C6‑0352/2008),

– having regard to Rule 51 of its Rules of Procedure,

– having regard to the report of the Committee on Economic and Monetary Affairs and the opinion of the Committee on Legal Affairs (A6‑0053/2009),

1. Approves the Commission proposal as amended;

2. Calls on the Commission to refer the matter to Parliament again if it intends to amend the proposal substantially or replace it with another text;

3. Instructs its President to forward its position to the Council and the Commission.

Amendment 1

Proposal for a regulation

Recital 5

Text proposed by the Commission

Amendment

(5) Regulation (EC) No 2560/2001 covers cross-border credit transfers and cross-border electronic payment transactions. It also covers cross-border cheques, but only for transparency purposes. In conformity with the objective of Directive 2007/64/EC to make cross-border direct debits possible, it is advisable to extend the scope of the Regulation. As for payment instruments which are mainly or exclusively paper-based, such as cheques, it is still not advisable to apply the principle of uniform charges since, by their very nature, they cannot be processed as efficiently as electronic payments.

(5) Regulation (EC) No 2560/2001 covers cross-border credit transfers and cross-border electronic payment transactions. In conformity with the objective of Directive 2007/64/EC to make cross-border direct debits possible, it is advisable to extend the scope of the Regulation. As for payment instruments which are mainly or exclusively paper-based, such as cheques, it is still not advisable to apply the principle of uniform charges since, by their very nature, they cannot be processed as efficiently as payments that are processed electronically. The principle of uniform charges should apply to payments initiated or terminated on paper or in cash, if they are electronically processed in the course of the payment execution chain, excluding cheques as well as to all charges, whether linked directly or indirectly to a payment transaction, excluding currency conversion charges. Indirect charges are, for example, charges for setting up a permanent payment order, or fees for using a payment card, debit or credit, which should be the same for national and cross-border payment transactions within the Community.

Justification

The proposed new revision of Regulation 2560/2001 does not contain any provisions relating to transparency; that subject is covered by Directive 2007/64/EC. In order to ensure legal clarity and certainty and avoid discordant interpretations of what charges are.

Amendment 2

Proposal for a regulation

Recital 5 a (new)

Text proposed by the Commission

Amendment

(5a) Member States should address the uncertainty regarding the applicability of a Multilateral Interchange Fee (MIF). In the absence of a bilateral agreement between the payment service providers of the payee and the payer, the level of the default interim MIF for a direct debit should be set at EUR 0,088 for a transitional period until 31 October 2012. At the end of that transitional period, it should be possible for MIFs to be maintained provided that they respect Commission guidelines. Those Commission guidelines should be adopted by 31 March 2010 and should be based on the observation of costs of and charges for the services rendered between the payment services providers.

Justification

To prevent uncertainties and close the debate on the MIF.

Amendment 3

Proposal for a regulation

Recital 6

Text proposed by the Commission

Amendment

(6) Since the fragmentation of payment markets should be prevented, it is appropriate to apply the principle of equality of charges. For that purpose, a national payment having the same or very similar characteristics to the cross-border payment, in particular as far as initiation channel, speed and degree of automation are concerned, should be identified for each category of cross-border payment transaction.

(6) Since the fragmentation of payment markets should be prevented, it is appropriate to apply the principle of equality of charges. For that purpose, a national payment having the same or very similar characteristics to the cross-border payment should be identified for each category of cross-border payment transaction. It should be possible to use the following criteria to identify the national payment corresponding to a cross-border payment: the currency used, the channel used to initiate, execute and terminate the payment, the degree of automation, the value of the transaction, any payment guarantee, the customer status, the relationship with the payment service provider, the form of consent or the payment instrument used, as defined in Article 4(23) of Directive 2007/64/EC. This set of criteria should not be regarded as exhaustive.

Justification

The Regulation must specify in detail the criteria for identifying payments having the same or similar characteristics to cross-border payments to ensure that the interpretation of these provisions does not vary from one Member State to another.

Amendment 4

Proposal for a regulation

Recital 9

Text proposed by the Commission

Amendment

(9) In order to ensure that redress is possible in the cases of wrong application of this Regulation, Member States should establish adequate and effective procedures for lodging complaints or appeals and for settling any disputes between the payment service user and his payment service provider. It is also important that competent authorities and out-of-court redress bodies are appointed, where applicable using existing procedures.

Justification

Competent authorities shall clarify when needed the notion of corresponding payment to avoid differences in interpretation.

Amendment 5

Proposal for a regulation

Article 1 – paragraph 2

Text proposed by the Commission

Amendment

2. This Regulation shall apply to cross-border payments up to the amount of EUR 50 000 which are denominated in euro or in the currencies of the Member States referred to in Article 11.

2. This Regulation shall apply to cross-border payments up to the amount of EUR 50 000, in line with the provisions of Directive 2007/64/EC, which are denominated in euro or in the currencies of the Member States referred to in Article 11.

Justification

The payments covered by this Regulation must be identical to those covered by the Directive on payment services.

Amendment 6

Proposal for a regulation

Article 1 – paragraph 3

Text proposed by the Commission

Amendment

3. This Regulation shall not apply to payments made by payment service providers for their own account.

3. This Regulation shall not apply to payments made by payment service providers for their own account or on behalf of other payment service providers.

Justification

Interbank services should not fall within the scope of this Regulation, which deals solely with the payment service providers’ policies as regards the charges they impose on their customers.

Amendment 7

Proposal for a regulation

Article 2 - point 1

Text proposed by the Commission

Amendment

(1) 'cross-border payments' means electronic payment transactions initiated by the payer or by or through a payee and carried out via a payment service provider or a branch thereof in one Member State, with a view to making an amount of money available to a payee via his payment service provider or a branch thereof in another Member State;

(1) 'cross-border payments' means electronically processed payment transactions initiated by the payer or by or through a payee where the payment service providers of the payer and the payee are located in different Member States;

Justification

The definition should be simplified and further aligned with the Payment Services Directive: according to Article 2(1) of the Payment Services Directive, it is decisive where a payment service provider is located, which includes branches.

Amendment 8

Proposal for a regulation

Article 2 – point 5

Text proposed by the Commission

Amendment

(5) 'payment service provider' means any of the categories referred to in Article 1(1) of Directive 2007/64/EC and legal and natural persons referred to in Article 26 of that Directive;

(5) 'payment service provider' means any of the categories referred to in Article 1(1) of Directive 2007/64/EC and legal and natural persons benefiting from a waiver under Article 26 of that Directive;

Justification

The current wording may lead to legal uncertainty about the conditions under which legal or natural persons can become payment service providers and about the nature –cross border or national only- of the activities they may engage in.

Amendment 9

Proposal for a regulation

Article 2 – point 9

Text proposed by the Commission

Amendment

(9) 'charges' means any charge levied by a payment service provider on the payment service user and directly or indirectly linked to a payment transaction.

(9) 'charges' means any charge levied by a payment service provider on the payment service user and directly linked to a payment transaction.

Justification

In order to ensure legal clarity and certainty and avoid discordant interpretations of what charges are, we would propose to amend the definition of “charges” in Article 2.9 eliminating from the definition the word “indirectly”.

Amendment 10

Proposal for a regulation

Article 2 – point 9 a (new)

Text proposed by the Commission

Amendment

(9a) 'funds' means banknotes and coins, scriptural money and electronic money as defined in Article 1(3)(b) of Directive 2000/46/EC;

Justification

The term 'funds' is being used in Article 2 (Definitions) of the proposed regulation. It should therefore be defined, by introducing the definition used in the Payment Services Directive (Article 4 (15)).

Amendment 11

Proposal for a regulation

Article 3 – paragraph 1

Text proposed by the Commission

Amendment

1. Charges levied by a payment service provider in respect of cross-border payments shall be the same as the charges levied by the same payment service provider for corresponding payments of the same value within the Member State from which the cross-border payment originates.

1. Charges levied by a payment service provider on a payment service user in respect of cross-border payments shall be the same as the charges levied by that payment service provider on that payment service user for corresponding payments of the same value in the same currency within the Member State from which the cross-border payment originates.

Justification

The rules on the equality of charges must be worded more precisely to avoid any possible confusion.

Amendment 12

Proposal for a regulation

Article 3 – paragraph 2

Text proposed by the Commission

Amendment

2. When assessing, for the purpose of complying with paragraph 1, the level of charges for a cross-border payment, a payment service provider shall identify the corresponding domestic payment.

2. When assessing, for the purpose of complying with paragraph 1, the level of charges for a cross-border payment, a payment service provider shall identify the corresponding or similar national payment.

The competent authorities shall issue guidelines to identify corresponding national payments where they consider it necessary. The competent authorities shall actively cooperate to ensure the compatibility of guidelines for corresponding national payments.

Justification

When assessing the level of charges for a cross-border payment the corresponding domestic payment or in the absence of the latter, the similar one should be taken into account.

It is useful to clarify guidelines how competent authorities shall identify corresponding payments.

Amendment 13

Proposal for a regulation

Article 3 – paragraph 3 (new)

Text proposed by the Commission

Amendment

3 Where a Member State, has notified the extension of the application of this Regulation to its currency in accordance with Article 11, a national payment in the currency of that Member States may be considered as corresponding to a cross-border payment which is denominated in euro.

Justification

This provision would allow the Regulation to be extended to EU Member State currencies other than the euro.

Amendment 14

Proposal for a regulation

Article 3 – paragraph 4 (new)

Text proposed by the Commission

Amendment

4. Article 52(2) of the Directive 2007/64/EC shall apply to credit transfers and direct debits.

Justification

This addition is necessary to ensure legal certainty and coherence with Directive 2007/64/EC.

Amendment 15

Proposal for a regulation

Article 3 – paragraph 5 (new)

Text proposed by the Commission

Amendment

5. This Regulation applies to electronic payments, including payments initiated or terminated on paper or in cash, if the transaction is electronically processed.

This Regulation applies to all charges linked to a framework contract and the associated payment transactions. Charges such as for setting up a permanent payment order or for using a payment card shall be the same for national and cross-border payment transactions within the Community.

This Regulation does not apply to currency conversion charges.

Justification

It is essential that the provisions of this Regulation relating to uniform charges should be clearly stated in the contract.

Amendment 16

Proposal for a regulation

Article 4 – paragraph 1

Text proposed by the Commission

Amendment

1. A payment service provider shall, where applicable, communicate to the payment service user the latter's International Bank Account Number (IBAN) and his Bank Identifier Code (BIC).

1. A payment service provider shall, where applicable, communicate to the payment service user the latter's unique identifier (e.g. IBAN) and his bank unique identifier (e.g. BIC).

In addition, where applicable, a payment service provider shall indicate on statements of account of a payment service user, or in an annex thereto, the latter's IBAN and his BIC.

In addition, where applicable, a payment service provider shall indicate on statements of account of a payment service user, or in an annex thereto, the latter's unique identifier (e.g. IBAN) and his bank unique identifier (e.g. BIC).

A payment service provider shall not charge the payment service user for providing information under this paragraph.

Justification

In order to ensure consistency with the Directive on Payment Services (PSD) the reference to IBAN and BIC in the Regulation on Cross-Boarder Payments shall be replaced by a reference to the unique identifiers.

To align the Regulation with the Payment Services Directive (Article 32(1)), it should be clarified that the provision of this information to the payment service user is free of cost.

Amendment 17

Proposal for a regulation

Article 4 – paragraph 2

Text proposed by the Commission

Amendment

2. Where appropriate with regard to the nature of the payment transaction concerned, for transactions initiated by the payer, the payer shall, upon request, communicate to his payment service provider the IBAN of the payee and the BIC of the payment service provider of the payee.

2. Where appropriate with regard to the nature of the payment transaction concerned, for transactions initiated by the payer, the payer shall, upon request, communicate to his payment service provider the unique identifiers (e.g. IBAN, BIC) of the payee and of the payment service provider of the payee.

Justification

Amendment 18

Proposal for a regulation

Article 4 – paragraph 3

Text proposed by the Commission

Amendment

3. Where appropriate with regard to the nature of the payment transaction concerned, for transactions initiated by the payee, the payee shall, upon request, communicate to his payment service provider the IBAN of the payer and the BIC of the payment service provider of the payer.

3. Where appropriate with regard to the nature of the payment transaction concerned, for transactions initiated by the payee, the payee shall, upon request, communicate to his payment service provider the unique identifiers (e.g. IBAN, BIC) of the payer and of the payment service provider of the payer.

Justification

Amendment 19

Proposal for a regulation

Article 4 – paragraph 4

Text proposed by the Commission

Amendment

4. Where appropriate with regard to the nature of the payment transaction concerned, for all invoicing of goods and services in the Community, a supplier who accepts payments covered by this Regulation shall communicate his IBAN and the BIC of his payment service provider to his customers.

4. Where appropriate with regard to the nature of the payment transaction concerned, for all invoicing of goods and services in the Community, a supplier who accepts payments covered by this Regulation shall communicate his unique identifiers (e.g. IBAN, BIC) and the unique identifiers (e.g. IBAN, BIC) of his payment service provider to his customers.

Justification

Amendment 20

Proposal for a regulation

Article 5 – paragraph 2

Text proposed by the Commission

Amendment

2. With effect from 1 January 2012 at the latest, Member States shall remove settlement-based national reporting obligations on payment service providers for balance of payments statistics.

2. With effect from 1 January 2015, Member States shall remove settlement-based national reporting obligations on payment service providers for balance of payments statistics.

Amendment 21

Proposal for a regulation

Article 6 – paragraph 1 – subparagraph 1 a (new)

Text proposed by the Commission

Amendment

Member States shall require the competent authorities to monitor compliance with this Regulation effectively and to take all necessary measures to ensure such compliance.

Justification

It should be explicitly stated that competent authorities ensure compliance with the Regulation, and do not only react to payment service user's complaints. The competent authorities should be able to intervene on their own initiative.

Amendment 22

Proposal for a regulation

Article 6 – paragraph 1 – subparagraph 2 a (new)

Text proposed by the Commission

Amendment

Member States may appoint existing institutions to act as competent authorities.

Amendment 23

Proposal for a regulation

Article 7 – paragraph 1 – subparagraph 1 a (new)

Text proposed by the Commission

Amendment

Member States may utilise or extend existing procedures for this purpose.

Amendment 24

Proposal for a regulation

Article 9

Text proposed by the Commission

Amendment

1. Competent authorities and out-of-court redress bodies of the different Member States, referred to in Articles 6 and 8, shall actively cooperate in solving cross-border disputes.

Competent authorities and out-of-court redress bodies of the different Member States, referred to in Articles 6 and 8, shall cooperate actively and expeditiously in solving cross-border disputes by exchanging information on the legal practice in their jurisdiction or by handing over complaint and redress procedures if appropriate.

Justification

It is useful to clarify further how competent authorities and out-of-court redress bodies shall cooperate in cases of cross-border disputes.

Amendment 25

Proposal for a regulation

Article 12 – paragraph 2

Text proposed by the Commission

Amendment

2. The Commission shall, by 31 December 2015 at the latest, present to the European Parliament, the Council, the European Economic and Social Committee and the European Central Bank a report on the application of this Regulation accompanied by any appropriate proposal.

2. The Commission shall, by 31 December 2012, present to the European Parliament, the Council, the European Economic and Social Committee and the European Central Bank a report on the application of this Regulation accompanied by any appropriate proposal.

Justification

It is not necessary to set such a long period for evaluation and presenting a report on the application of the Regulation.

EXPLANATORY STATEMENT

The inefficiencies and high costs of cross-border payments became apparent only after the introduction of the euro and the disappearance of exchange rates between the euro area countries.

Against such background, on 25 July 2001, the Commission made a proposal for Regulation (EC) No 2560/2001 of the European Parliament and of the Council on cross border payments in euro (hereinafter referred to as the 'Regulation 2560'). It was adopted on 19 December 2001 and entered into force on 31 December 2001 guaranteeing that cross-border payments cost the same as payments made within a Member State.

It applies to credit transfers, cash withdrawals at cash dispensers and payments by means of debit and credit cards up to EUR 12 500 within the European Economic Area countries (all 27 Member States of the European Union plus Iceland, Liechtenstein and Norway). As of 1 January 2006, the Regulation applies to cross-border payments of up to EUR 50 000.

The Regulation introduced the principle of equal charges for corresponding domestic (national) and cross-border payments which brought down the prices and provided more competition in the markets of the payment services. This Regulation has been the launch pad of the Single Euro Payments Area (SEPA).

The proposal for a modified Regulation comes in response to the rapid evolution of the payments market in the EU and is the result of a careful review process and a report, prepared by the European Commission in February 2008.

The review process of Regulation 2560 has involved a number of different elements.

A report of the European Commission provides how Regulation 2560/2001 was applied in the Member States and what practical problems have been encountered in its implementation. It concludes that a number of proposals should be made in order to address the identified issues, better reflect the developments in retail financial markets and align the Regulation with the recently adopted Payment Services Directive (2007/64/EC).

The report confirms that the Regulation has achieved two main objectives. First, it has triggered an important decrease in fees for cross-border payments, in particular for credit transfers (a EUR 100 cross-border transfer, which would have cost EUR 24 on the average before the Regulation was introduced, now costs EUR 2.50 on the average, without leading to an increase in charges for domestic transfers). Second, it has encouraged the financial services industry in the absence of an efficient and integrated infrastructure of the European payment services, to undertake the necessary efforts and to turn the concept of a 'domestic payment area' for non-cash Euro payments into reality, creating the Single Euro Payments Area (SEPA), which in the longer term should help to reduce costs for all consumers.

The report concludes that the scope of Regulation should be extended to include direct debit, which was previously not available on a cross-border basis. Furthermore, according to it, all Member States should set up competent authorities and adequate out-of court redress procedures for better protection of the consumer rights in disputes arising out of the Regulation.

Revision and a subsequent phasing-out of the balance of payments reporting obligations imposed on banks in some Member States are also envisaged, because these obligations hamper the development of SEPA, limit the introduction of fully automated processing of cross-border payments and ultimately lead to higher costs for banks and consumers.

The proposal by the Commission introduces five main changes to the current text of Regulation 2560/2001:

· It extends the principle of equality of charges for cross-border and corresponding domestic payments to cover direct debits (Article 2, definitions);

· It clarifies the notion of "corresponding payments" (Article 3);

· It requests Member States to appoint competent authorities and out-of-court redress bodies to deal affectively with complaints and disputes regarding this proposal (Articles 6 to 9);

· It phases out the balance-of-payments statistical reporting obligations imposed on payment service providers (EUR 50 000 until 1 January 2010 and complete phasing-out by 2012) (Article 5);

· Review clause (Article 12).

The emergence of the SEPA and the adoption of the Payment Services Directive (PSD) are changing the payments landscape in Europe. In particular, a popular electronic payment instrument – direct debit – will become available on a cross-border basis as from November 2009.

In order to create a fully consistent legal framework for all electronic payment instruments in Europe, and avoid any ambiguities which may result from differences between legal texts, the wording of the Regulation, in particular its definitions, needs to be aligned with the Payment Services Directive (2007/64/EC).

Suggested by the parliament amendments shall improve the COM proposal in the following fields:

· Clarification of definitions and the notion of corresponding payments;

· The Regulation should clarify that competent authorities shall be required by Member States to effectively monitor the Regulation and take all necessary measures to ensure compliance with it.

· A clarification, i.e. further details in Article 9 (cross-border cooperation) about how competent authorities and out-of-court redress bodies of different Member States shall cooperate might be useful.

Title	Cross-border payments in the Community
References	COM(2008)0640 – C6-0352/2008 – 2008/0194(COD)
Committee responsible	ECON
Opinion by Date announced in plenary	JURI 21.10.2008
Drafts(wo)man Date appointed	Aloyzas Sakalas 3.11.2008
Date adopted	20.1.2009
Result of final vote	+: –: 0:	19 0 0
Members present for the final vote	Carlo Casini, Bert Doorn, Monica Frassoni, Giuseppe Gargani, Neena Gill, Klaus-Heiner Lehne, Katalin Lévai, Antonio López-Istúriz White, Manuel Medina Ortega, Hartmut Nassauer, Aloyzas Sakalas, Eva-Riitta Siitonen, Francesco Enrico Speroni, Diana Wallis, Rainer Wieland, Jaroslav Zvěřina, Tadeusz Zwiefka
Substitute(s) present for the final vote	Eva Lichtenberger, Jacques Toubon

Title	Cross-border payments in the Community
References	COM(2008)0640 – C6-0352/2008 – 2008/0194(COD)
Date submitted to Parliament	13.10.2008
Committee responsible Date announced in plenary	ECON 21.10.2008
Committee(s) asked for opinion(s) Date announced in plenary	IMCO 21.10.2008		JURI 21.10.2008
Not delivering opinions Date of decision	IMCO 5.11.2008
Rapporteur(s) Date appointed	Margarita Starkevičiūtė 24.9.2008
Discussed in committee	5.11.2008		11.12.2008	20.1.2009
Date adopted	11.2.2009
Result of final vote	+: –: 0:	33 0 0
Members present for the final vote	Mariela Velichkova Baeva, Paolo Bartolozzi, Zsolt László Becsey, Pervenche Berès, Sharon Bowles, Udo Bullmann, Manuel António dos Santos, Christian Ehler, Elisa Ferreira, Ingo Friedrich, Jean-Paul Gauzès, Donata Gottardi, Benoît Hamon, Karsten Friedrich Hoppenstedt, Sophia in ‘t Veld, Othmar Karas, Wolf Klinz, Astrid Lulling, Sirpa Pietikäinen, John Purvis, Bernhard Rapkay, Dariusz Rosati, Antolín Sánchez Presedo, Olle Schmidt, Peter Skinner, Margarita Starkevičiūtė, Ivo Strejček, Ieke van den Burg, Sahra Wagenknecht
Substitute(s) present for the final vote	Mia De Vits, Werner Langen, Gianni Pittella, Eva-Riitta Siitonen