52004PC0673

Proposal for a Council Decision On a Community position within the EU/Mexico Joint Council concerning the amendments to the Joint Council Decision 2/2001 /* COM/2004/0673 final - ACC 2004/0244 */


Proposal for a COUNCIL DECISION On a Community position within the EU/Mexico Joint Council concerning the amendments to the Joint Council Decision 2/2001

(presented by the Commission)

EXPLANATORY MEMORANDUM

The EU/Mexico Free Trade area was established by decisions of the EU Mexico Joint Council. Consequently the necessary adaptations to the trade provisions, following the EU enlargement, are made by means of Joint Council decisions and have not been addressed into the Additional Protocol to the EU/Mexico Agreement that is also submitted for Council approval via another procedure.

The EU/Mexico Joint Council Decision 2/2001 provides for the liberalization of trade in services between the Parties in accordance with Article V of the GATS. Following the EU enlargement some adaptations are needed, in particular as regards its Annex I (limitations on market access and national treatment with respect to financial services) and Annex II (authorities responsible for financial services).

On 26 January 2004 the Council approved a mandate for the Commission to negotiate those adaptations. Subsequent negotiations with Mexico resulted in an agreement to transpose within Annex I of Decision 2/2001 the limitations on market access and national treatment listed in the GATS schedules of the new EU Member States. Annex II of Decision 2/2001 has also been updated by the Parties.

The Commission therefore recommends the Council to adopt the enclosed Council Decision as the EU common position on the proposed EU/Mexico Joint Council Decision in annex.

2004/0244 (ACC)

Proposal for a COUNCIL DECISION On a Community position within the EU/Mexico Joint Council concerning the amendments to the Joint Council Decision 2/2001

THE COUNCIL OF THE EUROPEAN UNION,

Having regard to the Treaty establishing the European Community and in particular Article 133 thereof, in conjunction with Article 300(2) first subparagraph, first sentence.

Having regard to the proposal from the Commission [1],

[1] OJ C [], [], p. [].

HAS DECIDED AS FOLLOWS:

Sole Article

To adopt as a Community position within the EU-Mexico Joint Council, the annexed draft decision.

Done at Brussels,

For the Council

The President

ANNEX

Draft Decision N° .../2004 of the EU-Mexico Joint Council

amending Joint Council Decision 2/2001 of 27 February 2001

THE JOINT COUNCIL

Having regard to the Economic Partnership, Political Coordination and Cooperation Agreement between the European Community and its Member States, of the one part, and the United Mexican States, of the other part, signed in Brussels on 8 December 1997 [2], and in particular Article 6 in conjunction with Article 47 thereof,

[2] OJ L 276, 28.10.2000, p. 45.

Whereas:

(1) As from 1st May 2004, the Treaty establishing the European Community will also be applied in the territory of Czech Republic, the Republic of Estonia, the Republic of Cyprus, the Republic of Latvia, the Republic of Lithuania, the Republic of Hungary, the Republic of Malta, the Republic of Poland, the Republic of Slovenia and the Slovak Republic (hereafter the new Member States), following their accession to the European Union

(2) In these circumstances, it is necessary to adapt, with effect from the date of accession of the new Member States to the European Union, annex I of Joint Council Decision 2/2001, in order to include the authorities responsible for financial services in the new Member States and the measures inconsistent with Articles 12 to 16 of Decision 2/2001 that they will maintain until Article 17(3) thereof is implemented. This adaptation also provides an opportunity for updating the list of authorities responsible for financial services.

HAS DECIDED AS FOLLOWS:

Article 1

Annex I, part A, of Decision 2/2001, is replaced by Annex I to this decision.

Article 2

Annex II, part A and part B, of Decision 2/2001, is replaced by Annex II to this decision.

Article 3

This Decision shall enter into force the date of its adoption, but it will take effect as from 1 May 2004.

Done in ....

For the Joint Council......

ANNEX I

Part A - Community and its Member States

1. The application of Chapter III to the Community and its Member States is subject to the limitations on market access and national treatment scheduled by the European Communities and its Member States in the "all sectors" sections of their GATS schedules and to those relating to the sub-sectors listed below.

2. The following abbreviations are used to indicate the Member States:

AT Austria

BE Belgium

CY Cyprus

CZ Czech Republic

DE Germany

DK Denmark

ES Spain

EE Estonia

FI Finland

FR France

EL Greece

HU Hungary

IE Ireland

IT Italy

LV Latvia

LT Lithuania

LU Luxembourg

MT Malta

NL The Netherlands

PL Poland

PT Portugal

SK Slovak Republic

SI Slovenia

SE Sweden

UK United Kingdom

3. The market access commitments in respect of modes (1) and (2) apply only to:

- the transactions indicated in paragraphs B.3 and B.4 of the market access section of the "Understanding on Commitments in Financial Services" respectively for all Member States;

- the transactions specified here below, with reference to the definitions of Article 11, for each Member State concerned:

CY: A.1.(a) (life insurance) and the remaining part of A.1.(b) (non-life non-MAT - marine, aviation, and other transport - insurance) in mode (2), B.6.(e) (trading of transferable securities) in mode (1);

EE: A.1.(a) (life insurance), the remaining part of A.1.(b) (non-life non-MAT insurance) and the remaining part of A.3. (non-MAT insurance intermediation) in modes (1) and (2), B.1. to B.10. (acceptance of deposits, lending of all types, financial leasing, all payment and money transmission services, guarantees and commitments, trading of securities, participation in issues of all kinds of securities, money broking, asset management, and settlement and clearing services for financial assets) in mode (1);

LV: A.1.(a) (life insurance), the remaining part of A.1.(b) (non-life non-MAT insurance) and the remaining part of A.3. (non-MAT insurance intermediation) in mode (2), B.7. (participation in issues of all kinds of securities) in mode (1);

LT: A.1.(a) (life insurance), the remaining part of A.1.(b) (non-life non-MAT insurance) and the remaining part of A.3. (non-MAT insurance intermediation) in mode (2), B.1. to B.10. (acceptance of deposits, lending of all types, financial leasing, all payment and money transmission services, guarantees and commitments, trading of securities, participation in issues of all kinds of securities, money broking, asset management, and settlement and clearing services for financial assets) in mode (1);

MT: A.1.(a) (life insurance) and the remaining part of A.1.(b) (non-life non-MAT insurance) in mode (2), B.1. and B.2. (acceptance of deposits and lending of all types) in mode (1);

SI: B.1. to B.10. (acceptance of deposits, lending of all types, financial leasing, all payment and money transmission services, guarantees and commitments, trading of securities, participation in issues of all kinds of securities, money broking, asset management, and settlement and clearing services for financial assets) in mode (1).

4. Unlike foreign subsidiaries, branches established directly in a Member State by a Mexican financial institution are not, with certain limited exceptions, subject to prudential regulations harmonised at Community level which enable such subsidiaries to benefit from enhanced facilities to set up new establishments and to provide cross-border services throughout the Community. Therefore, such branches receive an authorisation to operate in the territory of a Member State under conditions equivalent to those applied to domestic financial institutions of that Member State, and may be required to satisfy a number of specific prudential requirements such as, in the case of banking and securities, separate capitalisation and other solvency requirements and reporting and publication of accounts requirements or, in the case of insurance, specific guarantee and deposit requirements, a separate capitalisation, and the localisation in the Member State concerned of the assets representing the technical reserves and at least one third of the solvency margin. Member States may apply the restrictions indicated in this schedule only with regard to the direct establishment from a Mexican of a commercial presence or to the provision of cross-border services from Mexico; consequently, a Member State may not apply these restrictions, including those concerning establishment, to Mexican subsidiaries established in other Member States of the Community, unless these restrictions can also be applied to companies or nationals o f other Member States in conformity with Community Law.

5. CY: The following general conditions and qualifications would apply even where no limitations or conditions are stated in the schedule:

(i) Consideration of national security and public policy objectives;

(ii) This schedule does not in any way pertain to services supplied in the exercise of government functions. Also, it does not affect measures pertaining to trade in goods which may constitute inputs to a scheduled service or other services. In addition, limitations on market access or national treatment in respect of services which may constitute inputs to or be used to supply a scheduled service, shall continue to apply.

6. CY: The laws and regulations mentioned in this schedule should not be construed as an exhaustive reference to all laws, and regulations governing the financial sector. The transfer, for example, of information containing personal data, bank secret or any business secret is not allowed. Such transfer is subject to domestic laws on protection of confidentiality of information of banks' customers. Furthermore, it is noted that non-discriminatory qualitative measures pertaining to technical standards, public health and environmental considerations, licensing, prudential consideration, professional qualifications and competency requirements have not been listed as conditions or limitations to market access and national treatment.

7. CY: Unregulated financial services and products and the admission to the market of new financial services or products, may be subject to the existence or the introduction of a regulatory framework aimed at achieving the objectives indicated in Article 19 of Decision No 2/2001 of the EU-Mexico Joint Council.

8. CY: Due to exchange controls operative in Cyprus:

- residents are not permitted to purchase banking services which may involve transfer of funds abroad, while they are physically abroad;

- loans to non-residents/foreigners or non-resident controlled companies require approval from the Central Bank;

- acquisition of securities by non-residents also requires permission from the Central Bank;

- dealings in foreign currency may be carried out only through banks which have been accorded "Authorised Dealer" status from the Central Bank.

9. CZ: The admission to the market of new financial services and instruments may be subject to the existence of, and consistency with the domestic regulatory framework aimed at achieving the objectives indicated in Article 19 of Decision No 2/2001 of the EU-Mexico Joint Council.

10. CZ: As a general rule and in a non-discriminatory manner, financial institutions incorporated in the Czech Republic must adopt a specific legal form.

11. CZ: Compulsory motor third party liability insurance is provided by an exclusive supplier. When monopoly rights concerning compulsory motor third party liability are removed, providing this service will be open on a non-discriminatory basis to Czech established service providers. Compulsory health insurance is provided by licensed Czech owned suppliers only.

12. EE: Compulsory social security services are not committed.

13. HU: The admission to the market of new financial services or products may be subject to the existence of, and consistency with, a regulatory framework aimed at achieving the objectives indicated in Article 19 of Decision No 2/2001 of the EU-Mexico Joint Council.

14. HU: The transfer of information containing personal data, bank secret, securities secret and/or business secret is not allowed.

15. HU: As a general rule and in a non-discriminatory manner, financial institutions incorporated in Hungary must adopt a specific legal form.

16. HU: Insurance, banking, securities and collective investment management services should be performed by legally separate and independently capitalised suppliers of financial services.

17. MT: For mode (3) commitments, under exchange control legislation non-residents wishing to supply any services through the registration of a local company may do so with the prior permission of the Central Bank of Malta. Companies with the participation of non-resident legal or natural persons require a minimum share capital of 10,000 Maltese Liri of which 50% has to be paid up. The non-resident percentage share of the equity is to be paid for with funds emanating from abroad. Companies with non-resident participation must apply for a permit from the Ministry of Finance to acquire premises under the appropriate legislation.

18. MT: For mode (4) commitments, the requirements of Maltese legislation and regulations regarding entry, stay, acquisition of real property, work and social security measures shall continue to apply, including regulations concerning period of stay, minimum wages as well as collective wage agreements. Entry, work and residence permits are granted at the discretion of the Government of Malta.

19. MT: For modes (1) and (2) commitments, exchange control legislation allows a resident to transfer abroad annually for portfolio investment up to Lm 5,000. Amounts in excess of Lm 5,000 are subject to exchange control permission.

20. MT: Residents may borrow from overseas without the need to obtain exchange control approval if the borrowing is for a period exceeding three years. Such borrowings have however to be registered with the Central Bank.

21. PL: Prudential regulations in the financial sector are being elaborated in Poland. They may require alteration of the presently existing rules as well as preparation of the new laws.

22. SK: The admission to the market of new financial services and instruments may be subject to the existence of, and consistency with the domestic regulatory framework aimed at achieving the objectives indicated in Article 19 of Decision No 2/2001 of the EU-Mexico Joint Council.

23. SK: The following insurance services are provided by exclusive suppliers: Compulsory motor third party liability insurance, compulsory air transport insurance, the liability insurance of employer against injury or occupational disease have to be effected through the Slovak Insurance Company. The basic health insurance is confined to the Slovak health insurance companies having a licence for provision of health insurance granted by the Ministry of Healthcare of the Slovak Republic according to the Act 273/1994 Coll. of Law. Fund pension insurance schemes and sickness insurance are confined to the Social Insurance Company.

24. SI: The admission to the market of new financial services or products may be subject to the existence of, and consistency with, a regulatory framework aimed at achieving the objectives indicated in Article 19 of Decision No 2/2001 of the EU-Mexico Joint Council.

25. SI: As a general rule and in a non-discriminatory manner, financial institutions incorporated in the Republic of Slovenia must adopt a specific legal form.

26. SI: Insurance and banking activities should be performed by legally separate suppliers of financial services.

27. SI: Investment services can be provided only through banks and investment firms.

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ANNEX II

AUTHORITIES RESPONSIBLE FOR FINANCIAL SERVICES

Part A - For the Community and its Member States:

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Part B - For Mexico, The Secretaria de Hacienda y Credito Publico:

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