Implications of signing the Hague Securities Convention
16.10.2006
ORAL QUESTION WITH DEBATE O-0119/06
pursuant to Rule 108 of the Rules of Procedure
by Pervenche Berès, Wolf Klinz, Enrique Barón Crespo, Monica Frassoni, Magda Kósáné Kovács, Louis Grech, Adeline Hazan, Alain Lipietz, Antolín Sánchez Presedo, Benoît Hamon, Rosa Miguélez Ramos, Bernard Poignant, Donata Gottardi, Catherine Trautmann, Giovanni Pittella, Henri Weber, Inés Ayala Sender, Jean Cottigny, Jean-Luc Bennahmias, Marc Tarabella, Jean-Paul Gauzès, Kader Arif, Marie-Arlette Carlotti, Martine Roure, Nicola Zingaretti, Yannick Vaugrenard, Harlem Désir, Gilles Savary, Guy Bono, Janelly Fourtou, Rosa Díez González, Michel Rocard, Marie-Line Reynaud, Bernadette Vergnaud, Béatrice Patrie, Catherine Guy-Quint, Pierre Moscovici, Jean-Claude Fruteau and Csaba Tabajdi
to the Council
Following the release by the European Commission of its Legal Assessment, the Council is currently in the process of deciding if the European Union should or should not decide to sign the Hague Securities Convention. Given the major importance of the Convention for European investors and market participants, the European Parliament considers that it is insufficiently involved in the debate on this decision.
The European Parliament, on this issue, has one major goal: that the efficiency and the clarity of the current European rule relating to the conflict of law on securities holdings can be protected.
Indeed, the codecision process, in recent years, succeeded in creating one unified rule on conflict of law for Europe, which determines the applicable law as the law of the Member State where the account is located. Market participants, Member States and the European Commission all recognise that the ‘location of account’ formula works efficiently in the internal market.
Not recognising the validity of such a basic rule and advocating its replacement by a free choice of applicable laws by the parties of a securities account would certainly open the ‘Pandora's box’ of free choice of the applicable law for cash accounts as well. Moreover, while any country is asked to implement more and more strict legislation relating to money laundering, market abuses, transparency and corporate governance, establishing a rule on the alleged impossibility to localise securities accounts may be almost considered as rather provocative.
– Does the Council share this objective of the Parliament to try to fully protect the application of the ‘location of account’ formula?
– Before committing the EU to signing the Convention, has the Council actually tried to find a means to continue to apply the ‘location of account’ formula for European accounts while reserving the Convention's free choice of applicable law for accounts held outside the EU?
– Could the Council explain how it could commit the EU to signing the Convention without having carried out a true economic and business impact assessment of it?
Tabled: 16.10.2006
Forwarded: 17.10.2006
Deadline for reply: 07.11.2006