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EU's COREPER proposes new directive on electronic money

Thursday 26 March 2009 | 02:38 PM CET

EU\'s Committee of Permanent Representatives (COREPER), which is chaired by the Czech Presidency, has approved a proposal for a new directive governing the issuance of electronic money and supervision of electronic money institutions.

An important change to the current regulations is the legalisation of hybrid electronic money institutions, i.e. institutions that perform other activities in addition to the issuance of electronic money. This will allow mobile operators to develop their services in a clearly defined regulatory environment.

Another fundamental change in the draft directive is the reduction in the regulatory burden placed on electronic money institutions and the convergence of their status with the conditions for payment institutions under the Payment Services Directive. In terms of capital requirements, initial capital is reduced from the current EUR 1million to EUR 350,000, i.e. to approximately one-third. The directive is a compromise text agreed between the EU Council and the European Parliament.

The European Parliament should officially approve the proposal during its plenary session in the second half of April 2009, while the EU Council is expected to formally confirm it in May. The new Directive is to replace the existing Directive 2000/46/EC. The act plans to remove the high regulatory barriers preventing the development of an electronic money market in the EU and seeks to set reasonable conditions for the business operations of electronic money institutions.

 

 

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