UK authorities question legality of new EU proposal for financial supervision
The FT looks at the Commission's proposal for a two-tier EU-wide system for financial supervision, proposed in the so-called de Larosiere report. The proposals, which will be tabled next week, include a "European system of financial supervisors" set up to oversee individual banks and financial institutions. This body would be linked to three existing pan-EU coordinating committees, which will receive substantial new powers under the proposal.
The new bodies would be asked to develop harmonised rules and common approaches to supervision and to settle potential disputes between national supervisors. However, the UK has expressed opposition to the proposals, the FT reports. One main objection is said to be the legality of giving binding mediation powers to European supervisory authorities, so that they could ultimately determine the outcome of a dispute between national supervisors.
The other fundamental concern is likely to centre on the splitting of supervisory responsibility from fiscal responsibility - and allowing the new pan-EU bodies to supervise entities which, in a crisis, might need bail-out funds from national governments. A UK Government spokesperson is quoted saying: "We will consider [the report] carefully when the document is published. It's a starting-point for discussion."
Comment: Giving binding mediation powers to European supervisory authorities, effectively granting them the right to over-ride decisions made by national supervisory bodies, would mark a significant transfer of powers to the EU level. Whether in favour or against the proposal, such a shift requires a treaty change - not only a decision in the Council of Ministers. The UK Government is therefore right to question the legality of the proposal.
Ireland's Lisbon Treaty 'guarantee' on workers' rights proving problematic;
Irish government plans 'more intensive' campaign for second referendum
Euractiv reports that poltical agreement on one of the 'guarantees' - a declaration on workers' rights - promised to Ireland in return for holding a second referendum on the Lisbon Treaty is proving difficult. A number of EU countries are reluctant to include any text on workers' rights, as they believe it could cause difficulties at national level, particularly at a time of rising unemployment and economic recession.
The declaration on workers' rights is one of the assurances that Irish PM Brian Cowen sought from EU leaders, including a 'guarantee' that each EU member state would retain a commissioner (originally, Lisbon would introduce a rotating commissioner system), and protocols on neutrality, taxation and ethical issues.
Diplomatic sources told Euractiv that while the legal wording for the "commissioner guarantee" and protocols are nearing completion, the declaration on workers' rights is proving more problematic.
The article notes that should Ireland vote Yes, its 'guarantees' cannot be brought into law until the next time amendments are made to the EU Treaties, after the second Irish referendum. It has been suggested this could be in the form of the next EU Accession Treaty, either with Croatia or Iceland.
Meanwhile, Euractiv reports that Ireland's Foreign Minister Micheal Martin has said that his government will need to run a more intensive campaign in favour of the Lisbon Treaty than last year, when voters rejected it in a referendum.
"This time round, we will all need to up our game," Martin said. "We will all need to do more and to do it better, if we are to get the result that we sincerely believe to be in the interests of Ireland."
EurActiv EurActiv 2
Turkey: We will only accept full EU membership
EUobserver reports that the EU has reassured Turkey that it is still in negotiations for full EU membership, despite strong opposition from the French and German governments.
El Mundo reports that the Turkish government has said that it will not accept anything less than full entry into the EU, thereby rejecting France and Germany's proposals to give Turkey special status but avoid full integration. Turkish Foreign Minister Ahmet Davutoglu said "We will not accept an objective other than this one".
El Mundo EUobserver
New EU regulation for hedge funds continues to draw criticism
The Guardian looks at how hedge funds and private equity groups have performed in the crisis, noting that the proposed EU Directive for tough regulation of alternative investment funds is causing alarm in the two industries. The article quotes a hedge fund manager, saying, "The UK would be crazy not to fight; they have the monopoly of hedge fund industry in Europe. For the regulator it is good PR, it's good to go against hedge funds - but the problems came from the regulated banks. Regulated banks caused this problem, not hedge funds. It's a bit of a joke this whole thing."
German daily Handelsblatt has a special report on London hedge fund managers fleeing to Switzerland. The paper notes that the London financial sector has been hit twice: apart from increasing income taxes in the UK, the recent EU plans for the regulation of hedge funds and private equity might lead to a quarter of hedge funds fleeing the UK and the EU. A prominent London hedge fund manager, Crispin Odey, is quoted saying: "the British government is not interested to keep London as a financial centre. Everybody is thinking about leaving the city."
Barroso confirms that he has not made promises to Spanish PM in exchange for support
In an interview with El Pais, European Commission President Jose Manuel Barroso was asked what he promised to Spanish PM Jose Luis Zapatero in order to secure his support for a second mandate. Barroso responded, "I can guarantee that I haven't promised anything to anyone. I think that the President of the Commission must be independent. There cannot be conditions linked to support."
Le Monde has also published an interview with Barroso in which he was asked whether he fears a loss of public confidence in European institutions as a result of the economic crisis. Barroso responded: "once the crisis started, Europe reacted well. We avoided a European Lehman Brothers, while we were very close to a collapse of the financial system. Europe is 27 governments, 27 countries. We must act respecting these differences".
El Pais Le Monde
Italian courts rule that Berlusconi bribed his lawyer
The Guardian reports that Italian judges have declared that Italian PM Silvio Berlusconi had bribed his lawyer, David Mills, so that he could avoid conviction on corruption charges and hang on to "huge profits made from the conclusion of illicit corporate and financial operations".
Meanwhile, Finnish MP Erkki Tuomioja has criticised Berlusconi's 'chauvinistic and demeaning' attitude, writing on his blog that Berlusconi is "a shame for Italy and the whole of Europe...behaviour like this would not allow him to continue as Prime Minister in any other civilised country".
Guardian BBC Tuomioja YLE
According to the Frankfurter Allgemeine Zeitung, German Chancellor Angela Merkel has commented that "the EU should not intervene in everything". She however also mentioned that the European Commission had showed in its handling of the so-called Volkswagen law that the EU respects nationally agreed structures.
On the BBC Daily Politics Show yesterday, Declan Ganley and former Europe Minister Denis MacShane discussed MEPs' expenses and the presenter, Andrew Neil, pointed out, "When I have interviewed in the past week Caroline Flint and a leading Conservative and I've asked them if they will insist that MEPs' expenses are made public for the past four years, I cannot get an answer out of them." MacShane said that Labour MEPs should publish their expenses.
BBC Daily Politics show
EUobserver reports that some EU member states are still selling arms to the Sri Lankan government despite the EU having condemned the recent violence against the Tamil Tigers and calling for an independent inquiry into violations of human rights.
The ECJ has backed restrictions on pharmacy ownership in Germany and Italy, on the grounds of public health, in a move which will come as a blow to the European Commission.
An article in the FT looks at the splits within the ECB, noting that "the public appearance of the European Central Bank's governing council has looked rather ragged recently."
Lloyds Banking Group is expected to issue a warning today that it still faces the threat of action by Brussels under European state aid rules, with regards to the Government's asset protection scheme, according to the Times.
Euractiv reports that climate change and trade will top the agenda at EU-China summit in Prague today.
According to a study in Dagens Nyheter, 45% of Swedes are unaware that elections to the EP are taking place in June.
Le Monde reports that the French Socialist Party (PS) has launched a campaign to repeal the controversial Hadopi law on illegal downloading. The PS have pointed to 11 points on the bill which they believe contradict the Constitution.
European Voice reports that junior finance and environment ministers will meet on 22 May to discuss funding for developing countries to help them respond to climate change.
Parliament's Speaker forced out
The BBC reports that the House of Commons Speaker Michael Martin has told MPs he intends to stand down, becoming the first Speaker to be effectively forced out of office for 300 years. Mr Martin, who will also step down as an MP, has faced criticism over his handling of the MP expenses issue.
A leader in the Telegraph notes that the "system now lies broken and demoralised. With its sovereignty already dissipated by the power of the European Union, the role of the House in scrutinising legislation has been further undermined by the placing of time limits on all debates; the hours it sits have shrunk, the chamber is often virtually empty, and MPs routinely fail to articulate the concerns and aspirations of the people who elect them."
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