Dr Charles Tannock

Member of the European Parliament for London

Common-Sense Solution

Wall Street Journal - 20th March 2001

Sir

Alexandre Lamfalussy's report on European financial markets represents a highly important political opportunity to modernize EU securities legislation; an opportunity that we hope that the EU's three governing institutions will not let slip by ("EU Finance Ministers Disagree on Ways to Hasten New Laws," March 13). While we differ from his conclusions in some areas, Baron Lamfalussy's report proposes practical solutions to some of the most significant barriers that have held back the development of an integrated financial market in Europe.

A true European financial market would provide significant benefits for citizens, such as cheaper products for consumers, higher returns for savers and more readily available risk capital and finance for business. Sadly, such benefits will remain only an aspiration while EU financial legislation is poorly implemented and inconsistently interpreted. The report rightly suggests that closer and more formalized cooperation between regulators will help to reduce these obstacles.

As members of the European Parliament's Economic and Monetary Affairs Committee, we welcome the report's emphasis on keeping EU legislation up to date and adaptable to changing market conditions. It is dangerous to be regulating for yesterday's markets, and an up-to-date legislative framework will encourage innovation and choice for consumers. It is imperative that the new framework does not lead to increased complexity but instead enhances legislative flexibility and allows rapid updates to be made in technical areas.

We believe that, however, that it is vital to ensure that the new framework provides for genuine transparency and democratic scrutiny. We are actively looking for an agreement that will answer these concerns and allow Lamfalussy to go ahead. We very much hope that others across all three EU institutions will do the same. It would be in no one's interests if the proposals founder on a tug of war between the Commission and the Parliament.

We need a common-sense solution to kick start the single financial market and the Lamfalussy report provides it.

Theresa Villiers
Conservative MEP for London

Charles Tannock
Conservative MEP for London

Piia-Noora Kauppi
Conservative MEP for Oulu, Finland

Brussels.