Text proposed by the Commission

Amendments proposed by the ECB (1)

‘The success of SEPA is very important economically, monetarily as well as politically.’

‘The success of SEPA is very important economically as well as politically.’

Explanation

SEPA is important economically and politically but does not play a role in monetary policy; therefore the word ‘monetarily’ should be deleted.

‘Money remittance, internally processed payments, large-value payment transactions between payment service providers and payments via mobile phone should not fall under the scope of those rules since these payment services are not comparable to credit transfers and direct debits.’

‘Money remittance, internally processed payments, large-value payment transactions between payment service providers and payments via mobile phone should not fall under the scope of those rules since these payment services are not comparable to credit transfers and direct debits as defined in this Regulation. Payment transactions processed and settled through large value payment systems should also not fall under the scope of this Regulation.’

Explanation

The ECB suggests to add ‘as defined in this Regulation’ to clarify the message that money remittance, internally processed payments, etc., are not credit transfers and direct debits in the sense of the proposed regulation. As for the explanation of the new fourth sentence suggested by the ECB see Amendment 5.

‘In order to create an integrated market for electronic payments systems in euros, it is essential that the processing of credit transfers and direct debits are not hindered by technical obstacles and are carried out under a scheme whose basic rules are adhered to by a majority of payment services providers from a majority of Member States and be the same both for cross-border and for purely national credit transfer and direct debit transactions.’

‘In order to create an integrated market for electronic payments systems in euro, it is essential that the processing of credit transfers and direct debits are not hindered by technical obstacles, are carried out under a scheme whose basic rules are adhered to by a majority of payment services providers from a majority of Member States whose currency is the euro, and are the same both for cross-border and for purely national credit transfer and direct debit transactions.’

Explanation

Interoperability is essential to ensure that payments can be processed efficiently across the Union. The dual requirements, i.e. that the rules apply on a national and cross-border basis and the required majority participation, in recital 9 and Article 4(1) of the proposed regulation, are important measures to ensure that payment schemes become pan-European. However, taking into account the development of new payment services, adherence by payment service providers in Member States whose currency is not the euro might not be considered a priority, considering the low number of euro transactions in some of these Member States. It is therefore suggested to limit the condition in Article 4(1)(b) (see Amendment 14) and accordingly recital 9 to a majority of payment service providers in a majority of Member States whose currency is the euro. This should on the one hand, avoid insurmountable impediments at the launch of the innovative credit transfer and direct debit services and, on the other hand, ensure a pan-European character.

‘In some Member States, there are certain legacy payment instruments which are credit transfers or direct debits but which have very specific functionalities, often due to historical or legal reasons.’

‘In some Member States, there are certain legacy payment instruments which are classified as credit transfers or direct debits but which have very specific functionalities, often due to historical or legal reasons.’

Explanation

This suggestion is aimed at clarifying that certain legacy payment instruments are classified as credit transfers or direct debits irrespective of their very specific functions.

Explanation

Payments made through large value payment systems have never been within the scope of SEPA and should therefore be excluded from the scope of the proposed regulation. In this respect, the proposed regulation should clearly focus on bulk retail payments as an inclusion of large value payment systems would require a separate more complex Union act due to very different service levels. Considering the complexity of large value payment systems, the technical challenges the banking industry would face for such a migration, and that retail payments settled within large-value payment systems constitute less than 1 % of the total number of retail payments in the euro area, the ECB does not see any need for such a Union act.

However, in their role under the fourth indent of Article 3.1 and Article 22 of the Statute of the ESCB as operators of the component systems of the Trans-European Automated Real-time Gross settlement Express Transfer system (TARGET2), the ECB and the national central banks (NCBs) currently consider the introduction of ISO20022 XML standards in TARGET2 is an issue of strategic importance.

Explanation

The ECB agrees that card payments and cash withdrawals should be exempt from the proposed regulation; however card payments, with the exception of cash withdrawals from a payment account, always result in a credit transfer or direct debit to or from a payment account identified by its BBAN or IBAN. In addition card payments are not covered by the Commission’s impact assessment accompanying the proposed regulation and it follows that they fall outside the scope of the proposed regulation. Accordingly, the ECB suggests deleting the reference to the use of BBAN and IBAN to avoid an interpretation of card payments as being included de facto in the proposed regulation, which is contrary to the intention underlying this provision.

No current text.

Explanation

Activities performed by the ECB or a national central bank in accordance with the fourth indent of Article 127(2) of the Treaty, and Article 3 of the Statute of the ESCB, should be excluded from the scope of the proposed regulation with a view to central bank independence (see Article 130 of the Treaty). In this respect, the ECB suggests that the same exemption as contained under Article 1(1)(e) of Directive 2007/64/EC of the European Parliament and of the Council of 13 November 2007 on payment services in the internal market amending Directives 97/7/EC, 2002/65/EC, 2005/60/EC and 2006/48/EC and repealing Directive 97/5/EC (2) is inserted in the proposed regulation.

No current text.

Explanation

The ECB understands that the aim of Article 1(2)(c) of the proposed regulation is to exclude traditional card transactions from its scope of application while including transactions in which a payment card is used primarily to identify the payer when they initiate a direct debit or credit transfer transaction. Since a majority of card payments are finally settled either via a credit transfer or a direct debit transaction, the current drafting could be interpreted as including also card transactions in general. To ensure legal certainty, the ECB suggests introducing a definition of payment card and redrafting Article 7(2) of the proposed regulation, waiving direct debit transactions initiated by a card at a point of sale (see Amendment 17). In addition, Article 1(2)(c) of the proposed regulation exempts from the scope of application payment transactions through a payment card without defining the latter.

No current text.

Explanation

The suggested new Article 1(2)(b) of the proposed regulation (see Amendment 5) contains the term ‘large-value payment systems’, which should be defined.

No current text.

Explanation

Article 4(2) of the proposed regulation introduces the concept of interoperability between payment systems, which should only apply to retail payment systems (see Amendment 15). In view thereof, the term ‘retail payment systems’ should be defined.

Explanation

Since a credit transfer requires concrete action, which is more than mere consent on the part of the payer, its definition should be made more specific.

Explanation

In order to ensure consistency with other relevant secondary Union acts and for reasons of legal certainty, it is suggested to align the definition of ‘direct debit’ contained in the proposed regulation with the definition contained in Article 2(14) of Regulation (EC) No 924/2009 and in Article 4(28) of Directive 2007/64/EC.

Explanation

To ensure consistency with other relevant secondary Union legislation and for reasons of legal certainty, the definition of ‘payment scheme’ contained in the proposed regulation should be aligned with the definition of ‘direct debit scheme’ contained in Article 2(15) of Regulation (EC) No 924/2009, taking into account the common elements of a scheme contained in the two definitions.

Explanation

See explanation to Amendment 3.

Explanation

Article 4(2) of the proposed regulation requires technical interoperability of payment systems and payment schemes (where applicable) without defining concretely what is meant by such technical interoperability. Ideally, more precise drafting addressing the implications of the term would be warranted. In the absence of this, the ECB suggests deleting the reference to payment schemes as technical interoperability between such schemes is not regarded as operationally feasible. More importantly, retail payment systems and large-value payment systems are very different in nature from a processing, clearing, and settlement perspective, despite the fact that both types of systems can be used to process retail payment transactions. Generally speaking, retail payment systems make use of large-value payment systems for settlement of their balances. It should be made clear that interoperability can only be expected among payment systems of the same type. Demanding interoperability between retail payment systems and large-value payment systems would not only raise question of proportionality, since retail payments processed via large-value payment systems like TARGET2 and EURO1 constitute less than 1 % of the total number of retail payments in the euro area, but could also have unintended side effects from a risk and stability perspective.

Explanation

The ECB agrees that the requirements for credit transfers and direct debits should enter into force within a rather short timeframe, especially considering that SEPA credit transfer was launched in January 2008 and SEPA direct debit in November 2009. Taking into consideration the payment industry’s need for sufficiently long lead times, the ECB suggests setting concrete dates, which could preferably be at the end of January 2013 for credit transfers and the end of January 2014 for direct debits.

Explanation

See explanations to Amendment 8 and Amendment 20.

Explanation

To avoid hampering the development of new and innovative payment instruments, it is of the utmost importance that the technical requirements set out in delegated acts can be amended in a smooth and efficient way. When exercising its delegated powers, the Commission should do so in close cooperation with the Eurosystem and where relevant, with the other members of the ESCB and also based on a consultation of the payments industry and other stakeholders, to ensure, inter alia, that amendments are scheduled taking into account the payment industry’s business cycles.

Explanation

Payment schemes should not be restricted in the number of characters which can be provided, for which reason it is suggested to set 140 characters as a minimum.

Explanation

The drafting in point 3(f) of the Annex to the proposed regulation could be incorrectly interpreted as meaning that existing mandates that do not explicitly address both the payee and the payment service provider of the payer are void and must be re-signed. This could be a very burdensome exercise considering the vast number of existing direct debit mandates. It should therefore be made clear, for the avoidance of any possible doubt, that consent to the payer’s payment service provider may be given indirectly via the payee.