Tag Archives: Domestic market

Administrative cooperation in the field of taxation

Administrative cooperation in the field of taxation

Outline of the Community (European Union) legislation about Administrative cooperation in the field of taxation

Topics

These categories group together and put in context the legislative and non-legislative initiatives which deal with the same topic.

Taxation

Administrative cooperation in the field of taxation

Document or Iniciative

Council Directive 2011/16/EU of 15 February 2011 on administrative cooperation in the field of taxation and repealing Directive 77/799/EEC.

Summary

This directive repeals Directive 77/799/EEC and establishes new rules and procedures for the cooperation between European Union (EU) countries with a view to exchanging information that is relevant to the administration and enforcement of national laws in the field of taxation. It applies to all taxes except the following:

  • value added tax (VAT) and customs duties, or excise duties covered by other EU legislation on administrative cooperation between EU countries;
  • compulsory social security contributions payable to the EU country;
  • fees, such as for certificates and other documents issued by public authorities;
  • dues of a contractual nature, such as consideration for public utilities.

In accordance with this directive, on 17 June 2011 the Commission published a list of the EU countries’ competent national authorities in the Official Journal. The competent authority must designate a single central liaison office which is responsible for contacts with other EU countries in the field of administrative cooperation and may be responsible for contacts with the Commission. The competent authority may also designate liaison departments and competent officials with competences assigned according to national legislation or policy. Where a liaison department or a competent official receives a request for cooperation requiring action which is outside their area of competence, they must immediately send such a request to their country’s central liaison office and inform the requesting authority thereof.

EXCHANGE OF INFORMATION

Exchange of information on request

The requested authority must, at the request of the requesting authority, communicate any relevant information that it has in its possession or that it obtains from administrative enquiries. In order to obtain the requested information or to conduct the administrative enquiry requested, the requested authority must follow the same procedures as it would when acting on its own initiative or at the request of another authority in its own EU country. EU countries may not refuse to supply information solely because this information is held by a bank or other type of financial institution.

The requested authority must confirm receipt of the request within seven working days and must then provide the information as quickly as possible, and no later than six months after receipt of the request. If, however, the requested authority already possesses the information, it must be provided within two months of that date.

Mandatory automatic exchange of information

Each competent national authority must send to the competent authority of any other EU country, by automatic exchange, available information concerning taxable periods as from 1 January 2014 relating to residents in that other EU country on the following categories of income and capital:

  • income from employment;
  • director’s fees;
  • life insurance products not covered by other EU legal instruments on exchange of information and other such measures;
  • pensions;
  • ownership of and income from immovable property.

Spontaneous exchange of information

Each competent national authority must communicate information to the competent authority of any other EU country in the following situations:

  • the competent authority of one EU country has reason to suppose that there may be a loss of tax in the other EU country;
  • a person liable to tax obtains a reduction in, or an exemption from, tax in one EU country which would give rise to an increase in tax or to liability to tax in the other EU country;
  • business dealings between two persons liable to tax in different EU countries are conducted through one or more countries in such a way that a saving in tax may result in either or both of the EU countries;
  • the competent authority of one EU country has grounds for supposing that a saving of tax may result from artificial transfers of profits within groups of enterprises;
  • information forwarded to one EU country by another EU country’s competent authority has enabled information to be obtained which may be relevant in assessing liability to tax in the latter EU country.

Feedback

If requested, the competent authority which has received information has to send feedback to the sending country as soon as possible and no later than three months after the outcome of the use of the requested information is known.

OTHER FORMS OF ADMINISTRATIVE COOPERATION

Other forms of administrative cooperation include:

  • by agreement between the requesting authority and the requested authority, officials authorised by the requesting authority may be present in administrative offices and may participate in administrative enquiries in the requested country;
  • simultaneous controls of persons of common or complementary interest between two or more EU countries, with a view to exchanging the information obtained;
  • administrative notification;
  • sharing of best practices and experience to improve cooperation.

Any information communicated between EU countries in accordance with this directive is covered by the obligation of official secrecy and benefits from the protection extended to similar information under the national law of the EU country which received it. This information may be used in the following instances:

  • for the assessment and enforcement of other taxes and duties covered by Directive 2010/24/EU;
  • for the assessment and enforcement of compulsory social security contributions;
  • in judicial and administrative proceedings resulting from tax law infringements.

References

Act Entry into force Deadline for transposition in the Member States Official Journal

Directive 2011/16/EU

11.3.2011

1.1.2013

Article 8: 1.1.2015

OJ L 64, 11.3.2011

Online gambling

Online gambling

Outline of the Community (European Union) legislation about Online gambling

Topics

These categories group together and put in context the legislative and non-legislative initiatives which deal with the same topic.

Internal market > Single market for services

Online gambling (Green Paper)

In 2008, gambling revenues reached EUR 75.9 billion. Online gambling is the fastest-growing gaming sector. This growth, and that of the Internet, makes monitoring these cross-border services difficult. National legal frameworks vary enormously from one EU country to another, imposing different rules for licensing, related online services, payments, public interest objectives, and the fight against fraud. The Commission therefore decided to launch a consultation to identify common practices which would facilitate the provision of cross-border services. The aim is to achieve a regulated internal market for online gambling.

Document or Iniciative

European Commission Green Paper of 24 March 2011, on on-line gambling in the Internal Market [COM(2011) 128 final – Not published in the Official Journal].

Summary

This Green Paper aims to launch a debate on the development of online gambling in the European Union (EU). There are currently two national models applied in this sector, namely:

  • a strictly regulated framework within which licensed operators provide services;
  • a strictly controlled monopoly.

However, the development of extensive illegal or “black” online markets (markets consisting of unlicensed operators) or “grey” markets poses a number of challenges. It is for this reason that the European Commission wishes to consult the various stakeholders in order to better frame the development of such activities at cooperative or cross-border levels.

Definition and current legislation

Gambling falls under Article 56 of the Treaty on the Functioning of the EU (TFEU) and is governed by service provision rules. The terms covers a wide range of service activities which individuals can access directly by electronic means, such as:

  • online sports betting;
  • casino games;
  • media games;
  • promotional games;
  • gambling services operated by and for the benefit of recognised charities and non-profit making organisations;
  • lottery services.

The Internet and other technological platforms (i.e. mobile telephones) are used in online gaming:

  • to offer gambling services to consumers;
  • to allow consumers to bet or gamble against each other (betting exchanges or online poker);
  • as a distribution technique (e.g. lottery tickets).

Communication techniques used by providers of online gaming services for promotion and supply

The main communication techniques used to promote online services are:

  • TV advertising;
  • printed press advertising;
  • online commercial communications;
  • sales promotions (e.g. premium offers);
  • direct marketing;
  • sponsorship agreements;
  • online banners and pop-ups on non-gambling sites.

Payment services and pay-outs

Generally, operators require customers to deposit funds on player accounts before playing by using:

  • credit cards;
  • e-Wallets;
  • bank transfers;
  • pre-paid cards;
  • cash transfers.

Customer identification

Customer identification is necessary for the protection of minors, the prevention of money laundering and fraud, and “know-your-customer” controls. However, the absence of mutual recognition of identification services across the EU raises difficulties.

Public interest objectives

The Commission identifies three public interest objectives which may be valid for Member States in defining their national online gambling policies:

  • consumer protection: this involves protecting gamblers against fraudulent services, particularly gamblers suffering from addiction. Member States already have available a number of instruments such as age limits, bans on the use of credit or restrictions on certain forms of games. The Commission proposes to discuss the effectiveness of such instruments in protecting consumers;
  • public order: Member States should seek to prevent fraud and unfair games, as well as money laundering. The Commission notes the application of certain types of measures such as customer due diligence, payment controls and operational controls in combating these practices;
  • financing of public interest activities: methods for channelling gambling revenues vary considerably from one Member State to another. The Commission wishes to examine more closely systems of revenue returns to event organisers, and the risks of “free-riding” revenue channelling schemes through the provision of online gambling services.

Payment blocking and liability regimes

Member States have a wide range of practices to manage the licensing, regulation and monitoring of online gaming. Through this Green Paper, the Commission wishes to analyse the actual role of regulatory bodies in the Member States.

Gambling authorities could cooperate with national and European stakeholders. The Commission wishes to strengthen this type of cooperation.

In some Member States, there are blocking schemes to limit illicit and cross-border online gambling services by:

  • Domain Name System (DNS) filtering;
  • Internet Protocol (IP) blocking;
  • Payment blocking, based on the operators’ Merchant Category Code (MCC).

The Commission intends to develop tools to foster this type of procedure at cross-border level, as well as other practices.

Internal market in electricity

Internal market in electricity

Outline of the Community (European Union) legislation about Internal market in electricity

Topics

These categories group together and put in context the legislative and non-legislative initiatives which deal with the same topic.

Energy > Internal energy market

Internal market in electricity (from March 2011)

Document or Iniciative

Directive 2009/72/EC of the European Parliament and of the Council of 13 July 2009 concerning common rules for the internal market in electricity and repealing Directive 2003/54/EC (Text with EEA relevance).

Summary

This Directive is aimed at introducing common rules for the generation, transmission, distribution and supply of electricity. It also lays down universal service obligations and consumer rights, and clarifies competition requirements.

Rules for the organisation of the sector

The rules for the organisation of the sector are aimed at developing a competitive, secure and environmentally sustainable market in electricity.

Member States may impose on undertakings operating in the electricity sector public service obligations which cover issues of security and security of supply, regularity and quality of service, price, environmental protection and energy efficiency.

Member States shall ensure that all customers have the right to choose their electricity supplier and to change supplier easily, with the operator’s assistance, within three weeks. They shall also ensure that customers receive relevant consumption data.

Electricity suppliers are obliged to inform final customers about:

  • the contribution of each energy source;
  • the environmental impact caused;
  • their rights in the event of a dispute.

Member States shall put in place an independent mechanism (energy ombudsman or consumer body) to manage complaints or disputes efficiently.

Member States are also obliged to ensure the monitoring of security of supply. They shall define technical safety criteria to ensure the integration of their national markets at one or more regional levels. In addition, the national regulatory authorities are to cooperate with the Agency for the Cooperation of Energy Regulators to guarantee the compatibility of regulatory frameworks between regions.

Generation

Member States shall define criteria for the construction of generating capacity in their territory taking account of aspects such as:

  • the security and safety of electricity networks;
  • the protection of health and public safety;
  • the contribution made towards the Commission’s “20-20-20” objectives.

Transmission system operation

From 3 March 2012, Member States must unbundle transmission systems and transmission system operators.

An undertaking must first be certified before being officially designated as a transmission system operator. A list of transmission system operators designated by Member States shall then be published in the Official Journal of the European Union.

Transmission system operators are mainly responsible for:

  • ensuring the long-term ability of the system to meet demands for electricity;
  • ensuring adequate means to meet service obligations;
  • contributing to security of supply;
  • managing electricity flows on the system;
  • providing to the operator of any other system information related to the operation, development and interoperability of the interconnected system;
  • ensuring non-discrimination between system users;
  • providing system users with the information they need to access the system;
  • collecting congestion rents and payments under the inter-transmission system operator compensation mechanism.

Distribution network operation

Member States shall designate distribution system operators or require undertakings that own or are responsible for distribution systems to do so.

Distribution system operators are mainly responsible for:

  • ensuring long-term capacity of the system in terms of the distribution of electricity, operation, maintenance, development and environmental protection;
  • ensuring transparency with respect to system users;
  • providing system users with information;
  • covering energy losses and maintaining reserve electricity capacity.

Member States have the option of putting in place a closed distribution system to distribute electricity within a geographically confined industrial, commercial or shared services site.

Unbundling and transparency of accounts

Member States and the competent authorities have right of access to the accounts of electricity undertakings but shall preserve the confidentiality of certain information.

Electricity undertakings shall keep separate accounts for their transmission and distribution activities.

Organisation of access to the system

Member States shall organise a system of third party access to transmission and distribution systems. The tariffs based on that system shall be published.

Member States shall also lay down criteria for the granting of authorisations to construct direct lines in their territory, on an objective and non-discriminatory basis.

National regulatory authorities

Member States shall designate a regulatory authority at national level. It shall be independent and exercise its powers impartially. It is mainly responsible for:

  • fixing transmission or distribution tariffs;
  • cooperating in regard to cross-border issues;
  • monitoring investment plans of the transmission system operators;
  • ensuring access to customer consumption data.

Retail markets

Member States shall ensure that contractual arrangements, commitment to customers, data exchange and settlement rules, data ownership and metering responsibility are defined.

Non-household customers may contract simultaneously with several suppliers.

Derogatory measures

A Member State may take the necessary safeguard measures in the event of a sudden crisis in the market or where the safety of persons is threatened. Derogations may also be obtained in the event of operating problems in isolated systems.

This Directive repeals Directive 2003/54/EC with effect from 3 March 2011.

Context

The Communications entitled ‘Prospects for the internal gas and electricity market’ and ‘Sector inquiry into the gas and electricity markets’ emphasised the inadequate framing of the rules and measures in force relating to the internal electricity market. The Commission deemed it important to amend the current rules with a view to ensuring fair competition and supplying electricity at the lowest possible price in order to complete the internal market in energy.

REFERENCES

Act Entry into force Deadline for transposition in the Member States Official Journal
Directive 2009/72/EC

3.9.2009

3.3.2011

OJ L211 of 14.8.2009

Internal market in gas

Internal market in gas

Outline of the Community (European Union) legislation about Internal market in gas

Topics

These categories group together and put in context the legislative and non-legislative initiatives which deal with the same topic.

Energy > Internal energy market

Internal market in gas (from March 2011)

Document or Iniciative

Directive 2009/73/EC of the European Parliament and of the Council of 13 July 2009 concerning common rules for the internal market in natural gas and repealing Directive 2003/55/EC (Text with EEA relevance).

Summary

This Directive aims at introducing common rules for the transmission, distribution, supply and storage of natural gas. It concerns mainly natural gas, liquefied natural gas (LNG), biogas and gas from biomass.

Rules for the organisation of the sector

The rules for the organisation of the sector are aimed at creating a competitive, secure and environmentally sustainable market in natural gas.

Member States may impose on undertakings operating in the gas sector public service obligations which cover issues of security and security of supply, regularity and quality of service, price, environmental protection and energy efficiency.

Member States shall ensure that all customers have the right to choose their gas supplier and to change supplier easily, with their operator’s assistance, within three weeks. They shall also ensure that customers receive relevant consumption data.

Member States are responsible for monitoring security of supply issues and in particular those related to the balance of supply and demand on the national market, available supplies, maintenance of the networks and the measures to be taken in the event of supply problems. Regional or international cooperation may be put in place to ensure security of supply.

Member States shall ensure the integration of national markets at one or more regional levels, as a first step towards the integration of a fully liberalised internal market. The gas islands in isolated regions shall also be integrated. In this context, the national regulatory authorities shall cooperate with the Agency for the Cooperation of Energy Regulators.

Transmission, storage and LNG

From 3 March 2012, Member States shall unbundle transmission systems and transmission system operators.

An undertaking must first be certified before being officially designated as a transmission system operator. A list of transmission system operators designated by Member States shall then be published in the Official Journal of the European Union.

In addition, Member States shall designate one or more storage and LNG system operators responsible for:

  • operating, maintaining and developing transmission systems, storage and/or LNG facilities with due regard to the environment;
  • ensuring non-discrimination between system users;
  • providing information to any other transmission system operator, any other storage system operator, any other LNG system operator and/or any distribution system operator to ensure the interconnection of the transmission and storage of natural gas;
  • providing system users with the information they need to access the system.

Transmission system operators shall build sufficient cross-border capacity to integrate the European transmission infrastructure. Every year, they shall submit to the regulatory authority a ten-year network development plan indicating the main infrastructure that needs to be built or modernised as well as the investments to be executed over the next ten years.

Distribution and supply

Member States shall designate distribution system operators or require undertakings which own or are responsible for distribution systems to do so.

Distribution system operators are mainly responsible for:

  • ensuring the long-term capacity of the system in terms of the distribution of gas, operation, maintenance, development and environmental protection;
  • ensuring transparency with respect to system users;
  • providing system users with information;
  • covering energy losses and maintaining reserve capacity.

The distribution system operator shall be independent in legal terms from other activities not relating to distribution.

Distribution systems responsible for distributing natural gas within a geographically confined industrial, commercial or shared services site may be classified by the competent authorities as closed distribution systems. On this basis, they may be exempted from the requirement to have their tariffs, or the methodologies underlying their calculation, approved in advance.

Unbundling and transparency of accounts

Member States and the competent authorities shall have right of access to the accounts of natural gas undertakings but shall preserve the confidentiality of certain information.

Natural gas undertakings shall keep separate accounts for all of their activities relating to the supply of gas, such as transmission and distribution.

Organisation of access to the system

Member States or the competent regulatory authorities shall define the conditions for access to storage facilities and linepack. They shall take measures to ensure that eligible customers can obtain access to upstream pipeline networks. Moreover, they shall organise a system of third party access to transmission and distribution systems.

Natural gas undertakings may refuse access to the system on the basis of lack of capacity or where access to the system would compromise the performance of their public service obligations. Substantiated reasons shall be given for any such a refusal.

Final provisions

A Member State may take the necessary safeguard measures in the event of a sudden crisis in the market or where the safety of persons is threatened. These measures shall be notified to the other Member States and to the Commission.

This Directive repeals Directive 2003/55/EC as from 3 March 2011.

Context

The 2007 Commission Communications entitled “Prospects for the internal gas and electricity market” and “Sector inquiry into the gas and electricity markets” highlighted the inadequacy of the rules and measures in force relating to the internal market in gas in meeting the objectives laid down for the proper functioning of the internal market. The adoption of new rules was required.

REFERENCES

Act Entry into force Deadline for transposition in the Member States Official Journal
Directive 2009/73/EC

3.9.2009

3.3.2011

OJ L211 of 14.8.2009

Natural gas transmission networks

Natural gas transmission networks

Outline of the Community (European Union) legislation about Natural gas transmission networks

Topics

These categories group together and put in context the legislative and non-legislative initiatives which deal with the same topic.

Energy > Internal energy market

Natural gas transmission networks (from 2011)

Document or Iniciative

Regulation (EC) No 715/2009 of the European Parliament and of the Council of 13 July 2009 on conditions for access to the natural gas transmission networks and repealing Regulation (EC) No 1775/2005 (Text with EEA relevance).

Summary

This Regulation aims at laying down rules for natural gas transmission networks, gas storage and liquefied natural gas (LNG) facilities. It concerns access to infrastructures, particularly by determining the establishment of tariffs (solely for access to networks), services to be offered, allocation of capacity, transparency and balancing of the network.

Certification of transmission system operators

National regulatory authorities shall send the European Commission notification of decisions relating to the certification of a transmission system operator. The Commission then has a period of two months to deliver its opinion to the national regulatory authority. The authority then adopts the final decision concerning the certification of the transmission system operator. This decision and the Commission’s opinion are published.

European Network of Transmission System Operators (ENTSO) for gas

Creation of the ENTSO for Gas

By 3 March 2011, the transmission system operators for gas shall submit to the Commission and to the Agency for the Cooperation of Energy Regulators the draft statutes for the ENTSO for Gas, a list of members and draft rules of procedure.

Tasks of the ENTSO for Gas concerning network codes

The Commission shall consult the Agency for the Cooperation of Energy Regulators and the ENTSO for Gas in order to establish an annual list of the priorities which are to contribute to developing network codes. These codes shall be developed using a non-binding framework guideline submitted to the Commission by the Agency. The codes include rules and procedures relating in particular to:

  • network security and reliability;
  • data interchange;
  • technical and operational exchanges;
  • transparency rules;
  • harmonised transmission tariff structures;
  • energy efficiency.

Tasks of the ENTSO for Gas

The ENTSO for Gas is responsible for adopting:

  • common network operation tools;
  • a ten-year network development plan;
  • recommendations relating to the coordination of technical cooperation between Community transmission system operators;
  • an annual work programme;
  • an annual report;
  • annual summer and winter supply outlooks.

Costs and tariffs

The regulatory authorities shall determine tariffs or methodologies for their calculation. Member States may take decisions relating to tariffs such as fixing auction arrangements.

Third-party access services

Transmission system operators shall offer their services equitably to all network users on a rolling basis in the long and short term.

LNG and storage facility operators must also offer their services according to the procedure described above and make them compatible with the use of interconnected gas transport networks.

Allocation of capacity and congestion management

All market participants must have access to maximum network capacity as well as storage and LNG facilities.

Infrastructure operators shall implement and publish non-discriminatory and transparent congestion-management procedures which facilitate cross-border exchanges in gas on a non-discriminatory basis.

This Regulation repeals Regulation (EC) No 1775/2005 as from 3 March 2011.

Context

The 2002 and 2003 European Gas Regulatory Forums (the Madrid Forums) were at the origin of guidelines on best practice. However, experience acquired has demonstrated that these guidelines should be made legally enforceable. This Regulation is based on the guidelines in order to strengthen the internal market in natural gas.

References

Act Entry into force Deadline for transposition in the Member States Official Journal
Regulation (EC) No 715/2009

3.9.2009

OJ L211 of 14.8.2009

Packaged retail investment products

Packaged retail investment products

Outline of the Community (European Union) legislation about Packaged retail investment products

Topics

These categories group together and put in context the legislative and non-legislative initiatives which deal with the same topic.

Internal market > Financial services: general framework

Packaged retail investment products

Document or Iniciative

Communication from the Commission to the European Parliament and to the Council of 30 April 2009 – Packaged retail investment products [COM(2009) 204 final – Not published in the Official Journal].

Summary

This Communication presents the measures planned by the European Commission in the packaged retail investment products sector and more specifically in terms of mandatory information and commercial practices. The aim is bring the Community framework into line with market reality. In this regard, the Commission intends to introduce, at European level, a horizontal approach in the field of retail investment products.

Characteristics

Packaged retail investment products have the following points in common:

  • they offer exposure to underlying financial assets;
  • their primary function is capital accumulation;
  • they are designed with the mid- to long-term in mind;
  • they are marketed directly to retail investors.

These products include the following types:

  • investment (or mutual) funds;
  • investments packaged as life insurance policies;
  • retail structured securities;
  • structured term deposits.

Current weaknesses

Packaged retail investment products can be at the origin of risks where there is a sharp asymmetry in information and expertise between the manufacturers and distributors of products and retail investors.

Another main weakness of this type of product is related to the inconsistencies in the European regulatory framework in force. It is currently inadequate with regard to the retail investment market reality and is not able to offer investors a satisfactory level of protection.

The main failings of the Community framework for packaged retail investment products have their origin in the lack of key investor disclosures and in the regulation of commercial practices.

Proposals for a horizontal approach

Key investor disclosures

Information for retail investors should be harmonised and standardised as much as possible so that they are better able to compare products.

Key information made available to investors should comply with the following criteria:

  • be fair, clear and not misleading;
  • guide investors, enabling them to make informed investment decisions (performance, risks, charges, etc.);
  • be short and simple;
  • be provided at the right time.

Selling of packaged retail investment products by intermediaries and other distributors

The MiFID (Markets in Financial Instruments Directive) provisions are considered to be a benchmark on conduct of business and the management of conflicts of interest. The Commission suggests that the scope of MiFID be extended to all packaged retail investment products.

The horizontal approach governing the regulation of commercial practices would be based on the following principles:

  • investors should be fairly treated;
  • products sold should correspond to the profile and needs of the investor;
  • risks should be clearly communicated to the investor if they decide not to take advice;
  • conflicts of interest must not adversely affect investors;
  • investors should receive clear and effective disclosures of remuneration arrangements and all charges, commissions or fees paid;
  • those assessing the suitability of products should fully understand all their features.

It is still necessary however to establish a generic definition of the concept of “a packaged retail investment product”, and a clear designation of the products that fall within scope.

Context

This Communication is the result of work carried out following the request by the ECOFIN Council in May 2007, and has the aim of restoring confidence with regard to financial markets. It is part of the reforms launched by the European Union since the start of the financial crisis in October 2008. This demonstrated the importance of ensuring transparency in financial products and brought to light the disastrous consequences of irresponsible marketing.