EU-flash: December Eurogroup & ECOFIN meeting; and Council adoption of bank creditor hierarchy and IFRS 9

18/12/2017

A Eurogroup meeting took place on December 4, inter alia, to elect a new President. The Finance Ministers of the EU Member States met on December 5 in Brussels to discuss an EU list of non-cooperative tax jurisdictions, digital taxation, VAT on e-commerce and several proposals regarding the Banking Union. The European Council adopted legislative texts on bank creditor hierarchy and IFRS 9 rules.

Below you will find a summary of the work programme.

Eurogroup meeting on 4 December 2017

The Eurogroup met on 4 December in two formats: the first was a regular meeting of the euro area ministers, while the second part was a meeting of the ministers from 27 EU member states with the aim of preparing the December Euro Summit.

Meeting in euro area format

The Eurogroup elected Mário Centeno, Portuguese Minister for Finance as next Eurogroup President. He will begin his term as of 13 January 2018. The President of the Eurogroup is elected by its members by simple majority, for a term of 2.5 years, in line with Protocol 14 of the Treaty.

The Eurogroup also adopted its work programme for the first semester of 2018.

The ministers continued their preparation of the December Euro Summit meeting discussing matters related to the deepening of the Economic and Monetary Union (EMU) and the completion of the banking union.

Results of the ECOFIN meeting of 5 December 2017

EU Finance Ministers met on 5 December 2017 in Brussels to discuss the adoption of an EU list of non-cooperative jurisdictions for taxation matters, as well as digital taxation, VAT on electronic commerce and a number of banking proposals.

List of non-cooperative jurisdictions in taxation matters

The list is intended to contribute to efforts to prevent tax fraud and tax evasion. The Council's work on the list has been conducted in parallel with the OECD.

In total, ministers have listed 17 countries for failing to meet agreed tax governance standards. In addition, 47 countries have committed to addressing deficiencies in their tax systems and to meet the required criteria, following contacts with the EU.

To view the list, click here.

Digital taxation

The Council also agreed on conclusions on ‘digital taxation’. Its conclusions will also serve as a reference for further work at EU level, including with a view to Commission legislative proposals expected early in 2018.

New rules regarding VAT on electronic commerce

The Council adopted new rules regarding VAT on electronic commerce. Part of the EU's 'digital single market' strategy, the proposals are aimed at making it easier for businesses operating online to comply with VAT obligations. They will facilitate also the collection of VAT when consumers buy goods and services online, including from third countries.

Banking proposals

The Council reviewed work on a package of measures aimed at reducing risk in the banking industry, and on a proposal for a European deposit insurance scheme.
And the Commission reported on work to implement the Council’s July 2017 action plan on non-performing loans in the banking sector.

Details.

Council adopts creditor hierarchy, IFRS 9/large exposures rules

On 7 December 2017, the Council adopted two legislative acts:

  • a directive on the ranking of unsecured debt instruments in insolvency proceedings (bank creditor hierarchy);
  • a regulation on transitional arrangements to phase in the regulatory capital impact of the IFRS 9 international accounting standard.

The draft regulation also contains a phase-out of provisions on the large exposures treatment of public sector debt denominated in non-domestic EU currencies.

To read the final text on insolvency hierarchy, click here.

To read the final text on IFRS 9, click here.

More information.

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