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European Union

Published on March 25, 2014
Press conference by M. François Hollande, President of the Republic, at the European Council (excerpts)

Brussels, March 20, 2014

Good evening. There are in fact two items on the agenda of this European Council. The first relates to the culmination of a process, with the conclusion of banking union and the end of banking secrecy. Two major decisions – which had been prepared for many months and awaited for years – finally materialized.

EU/BANKING UNION

For banking union, you’ll remember it was in June 2012 that the principles of this banking union were laid down. Two years later we reached the essential compromise, not only between the heads of state and government, for the resolution mechanism, but also with the European Parliament. It’s the clearest sign not only that we’ve emerged from the Euro Area crisis, from what was called the Euro Area crisis, but also that we’ve introduced provisions that will enable us not to experience – at least, not on the same scale – the turbulence that has hit Europe in recent years.

This banking union, moreover, was created under the conditions France wanted from the outset, namely a simple decision-making procedure, because it’s the European Central Bank that will trigger the resolution mechanism. A resolution fund could itself be activated quickly, even more quickly than had been planned, because in eight years it will be ready, and from the first year 40% of it will have been pooled.

What does this mean in practice? It means it will be the banks that pay for the banks, and under no circumstances taxpayers, as happened with the Euro Area crisis, which was a banking crisis and then a budget crisis. Now the mechanism that has been found will enable us to get any possible failings in the banks funded by the banks themselves.

Finally, the mechanism is credible and operational because it will be implemented in 2016. So that’s satisfying. When Europe makes progress, that must be welcomed. We’re in the run-up to an election.
I’m not talking about the local elections, I’m talking about the renewal of the European Parliament! This will be credited to the European Parliament itself, the governments that made the agreement possible and above all Economic and Monetary Union, which has thus made progress.

BANKING SECRECY

And a second decision was also endorsed at this Council meeting, namely the lifting of banking secrecy. There too, as you know, the subject had been dealt with for 15 years, and postponements, delays, grace periods if you will were granted to a few countries that were asking for others’ situations to be aligned with their own… All the EU countries will now, finally, face the same rules, with this automatic information exchange and the impossibility of escaping tax. It wasn’t easy for countries – I must acknowledge the efforts made by, for example, Luxembourg and Austria – to put an end to this history and these arrangements. Those countries have agreed, which now enables us to have the same rules throughout the EU.

INDUSTRY/ENERGY/CLIMATE

Principles were also laid down at this Council meeting about industry, about what it should be in Europe, about the support that could be provided to it and about new technologies and research efforts, which could be supported more. And on this too there was progress, because Europe has embarked on a research and innovation policy, better protected intellectual property (because there’s now a European patent) and considered that trade policy must take reciprocity into account, particularly in the industrial sphere, and finally because competition policy, too, had to take industry and energy into account, because energy will be – and this will be the focus of tomorrow morning’s meeting – the big question.

This question is twofold. It’s to ensure both that we deliver on the climate conference and that Europe can be an example, particularly in reduding greenhouse gas emissions. At the same time, we must do everything to ensure that Europe can have sufficiently diversified energy sources to have a level of independence – we’re not far from the question we’re going to discuss, about Ukraine and Russia – and also that this energy can be at the lowest cost, so that we don’t experience competitiveness gaps, particularly with the United States of America. (…)./.

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