Members of the Economic and Monetary Affairs committee are holding back a vote on a number of directives until they receive confirmation the directive will be strictly implemented.
EU Economic and Monetary Affairs chair Sharon Bowles (pictured) told Mortgage Solutions the procedure was a way of ensuring a lax implementation in one member state could not be exploited by fraudsters in another.
She said the directives were on hold: “I’m basically saying we’re not voting on them until I get my way.” The committee backed her actions, she added.
According to Bowles, it may be possible to come up with a solution which can be voted on as part of another financial directive, Omnibus II. The vote on Omnibus II is scheduled for 3 February 2014, although it has been postponed several times.
She said: “I won’t release these directives until I’ve seen the signature on the dotted line, as it were, from the European Council.”
Under Bowles’ proposal, EU members must provide tables showing exactly how the directive was enforced, rather than simply listing what they have done. As a result, fraudsters such as those behind boilerplate scams would find it harder to exploit the lax rules of one country in order to target consumers in another.
However, the requirement for more stringent reporting is unpopular with many member states.
Bowles, who is meeting the Financial Conduct Authority as part of a fact-finding trip to the UK, said the mortgage directive would help UK consumers who were buying homes abroad.
She dismissed complaints from the industry that the UK already had adequate consumer protection: “We’re not in Europe making rules just for the UK – that’s for the UK to do. We’re in Europe making rules that cover everybody.
“The fact the UK’s got an almost fit is a) a good thing and b) no coincidence because we tried.”
Grant Thornton financial services advisory manager Keith Green said: “If you look at the history of the EU mortgage directive it has been delayed a number of times already.”
At the moment, in the case of minimum harmonisation directives such as the EU mortgage directive, member states could simply state they had complied, he added.
