EU Publishes Banking, Energy, and VAT Legislation

In addition to our Washington legislative updates, Capital Thinking will now include EU legislative developments, covering updates from Brussels.

The European Commission, responsible for proposing European legislation, published a number of legislative proposals last week.

A package of reforms to strengthen the resilience of EU banks was published on November 23, building on existing EU banking rules. This includes the following proposals:

  •  2016/0360 (COD): Proposal to amend the Capital Requirements Regulation;
  • 2016/0364 (COD): Proposal to amend the Capital Requirements Directive;
  •  2016/0363 (COD): Proposal for Directive on the ranking of unsecured debt instruments in insolvency hierarchy;
  • 2016/0362 (COD): Proposal for Directive on loss-absorbing and recapitalization capacity of credit institutions and investment firms; and
  • 2016/0361 (COD) : Proposal to amend the Single Resolution Mechanism Regulation

Additionally, the European Commission published another proposal (2016/0365 (COD) on November 28, on the Recovery and Resolution of Central Counterparties (CCPs). This initiative was proposed to address the challenges of the growing importance of CCPs as well as the potential risks they may pose for the financial stability in the EU.

On November 30, the European Commission also published a Communication outlining its Action Plan for a European Defense Strategy (COM(2016) 950).

Further to the above, a new package on clean energy was introduced to co-legislators on November 30, including a variety of proposals:

  • 2016/0379 (COD): Proposal for a revised electricity regulation;
  • 2016/0380 (COD): Proposal for a revised electricity Directive;
  • 2016/0378 (COD): Proposal for a revised regulation on a European Agency for the Cooperation of Energy Regulators (ACER);
  • 2016/0377 (COD): Proposal for a new regulation on risk preparedness in the electricity sector;
  • 2016/0376 (COD): Proposal for a revised energy efficiency Directive;
  • 2016/0381 (COD): Proposal for a revised energy performance of buildings Directive;
  • 2016/0382 (COD): Proposal for a revised renewable energy Directive; and
  • 2016/0375 (COD) Proposal for a regulation on the Governance of the Energy Union

As part of this package four Communications outlining the European Commission planning was made available:

  • COM(2016) 860: Communication on ‘Clean Energy For All Europeans’;
  • COM(2016) 773: Communication on an eco-design working plan 2016-019;
  • COM(2016) 763: Communication on accelerating clean energy innovation; and
  • COM(2016) 766: Communication on a European strategy on cooperative, intelligent transport systems (deploying a connected cars scheme in Europe)

Finally, Modernizing VAT in the Digital Single Market has been a priority for the European Commission. On December 1, a VAT package was released comprising the following legislative proposals:

  • 2016/0370 (CNS): Proposal for a Directive as regards certain value added tax obligations for supplies of services and distance sales of goods;
  • 2016/0372 (NLE): Proposal for a Implementing Regulation laying down implementing measures on the common system of value added tax;
  • 2016/0371 (CNS): Proposal for a Council Regulation on administrative cooperation and combating fraud in the field of value added tax; and
  • 2016/0374 (CNS): Proposal for a Directive as regards rates of value added tax applied to books, newspapers and periodicals

The above proposals are now available for review by the two other co-legislators in the EU, the European Parliament and the Council of the EU, with the exception of the VAT rules. Once they have reviewed the above proposals, these two institutions will produce their negotiating position.