Consumer protection measures undermined by MEP vote

22-Oct-2013 @ 14:0

Syed Kamall Syed Kamall

Anthea McIntyre Anthea McIntyre

Anthea McIntyre Anthea McIntyre

Late last night, the European Parliament's Economic andMonetary Affairs Committee decided to add additional, unnecessary requirementsto investor-protection measures set out in the Key Information DocumentRegulation.

This proposal, intended to help consumers make decisionsabout investing their money in packaged retail investment products, wasoriginally drafted as a simple two-page document with clear instructions on howto write them.

Although there were serious concerns that the regulationwould unnecessarily be extended to cover all investment products, a last minutedeal averted the worst outcome. Unfortunately, MEPs then decided to write thecontent requirements themselves, as well as introduced many requirements whichare already being dealt with in a separate piece of legislation called MIFID 2.

Syed Kamall, Conservative spokesman on economic andmonetary affairs, said: "From the beginning of the negotiation processearlier this year, it became clear that many colleagues on this committee weredead set on rewriting what had been a relatively simple, cohesive document.

"I'm pleased that the Socialists backed down at thelast minute on the issue of the scope of the regulation, to reach a deal withthe centre-right block. However I still could not support the eventual proposalbecause it still sought to regulate the issue of corporate bonds and pensionpackages.

The London MEP added: "The rest of the proposal hasbeen embellished with additions that are at best pointless and at worst hugelyburdensome. I'm not convinced many consumers will find this useful atall."

All members of the European Parliament will now have thechance to vote on the committee text as the report will be taken next toplenary sitting of the full parliament.

Dr Kamall said: "It will be interesting to seehow much support the text can muster. I certainly will seek to remove more ofthe unnecessary additions to the text at this stage ahead of negotiations withthe EU Council and Commission."

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