§ Mr. Cousins:To ask the Chancellor of the Exchequer what the reasons were for voting against the first reading common position of the ECOFIN Council or the Investment Services Directive; and what his key objectives are for a compromise agreement. [141200]
§ Ruth Kelly:On 7 October, ECOFIN Council reached political agreement on a Common Position on the proposed Investment Services Directive, by qualified majority. The UK, Ireland, Luxembourg, Sweden and Finland voted against the text put forward by the Presidency.
The Government voted against the text proposed at ECOFIN because it contained unsatisfactory elements that the Government believed meant that it would fall short of its objective of promoting an efficient, effective and dynamic single market in investment services.
The Government was particularly disappointed by the outcome on the pre-trade transparency regime for investment firms that systematically internalise client orders. It believes that the regime proposed would be a step backward for some share-trading markets in the EU, including the UK, and would be a missed opportunity to increase competition and efficiency in many markets in the EU.
The Government will continue to press for changes to the Directive, especially through the second reading process in the European Parliament. In doing so, it will focus on achieving changes to the pre-trade transparency regime for investment firms that would be consistent with the European Parliament's first reading amendments.
At ECOFIN Council on 25 November, the Government secured agreement to a Declaration, to be adopted alongside the Council Common Position, which reiterates the Council's support for adoption of the Investment Services Directive by April 2004 and, more importantly, indicates a willingness on the part of the Council to consider amendments put forward by the European Parliament.