Telenor 1 comments to the European Commission s Public Consultation on the Electronic Money Directive (2000/46/EC)

Transcription

1 European Commission Internal Market and Services DG Financial Institutions Banking and Financial Conglomerates B-1049 Brussels, Belgium ( Telenor 1 comments to the European Commission s Public Consultation on the Electronic Money Directive (2000/46/EC) For further information please contact: Krisztina Baracsi Manager of Legal Affairs Telenor Representative Office Avenue de Tervueren 13B 1040 Brussels, Belgium Tel: krisztina.baracsi@telenor.com 1 Telenor Group is the largest provider of telecommunications services in Norway, and has substantial international mobile operations. Mobile is Telenor's business area for development and management of mobile services within voice, data, Internet and content services in Norway and internationally. Telenor Mobile has ownership interests in 12 mobile operations and is geographically concentrated in selected countries in Europe and South East Asia.

2 2

3 1) Primary goals of the e-money Directive Level Playing field a) Has a level playing field between ELMI s and other credit institutions issuing E- Money been achieved? The e-money Directive (hereafter: Directive) had traditional banking operations as a basis when it was drafted and implemented. The banking industry had legitimate reasons to ensure level playing field. An ELMI issues surrogate for coins, and aims essentially at micro payments where traditional payment methods have not proven adequate. The relevant question is whether the mentioned basis for the Directive was the right one. Telenor believes that the Directive should regulate corresponding activities equally, with no regards as to the ownership or the origin of the ELMI. There is no need, and it is clearly not proportionate to establish detrimental provisions due to the existing regulation applied to the banking/credit industry. An ELMI owned by a traditional credit institution should be regulated in the same manner as an ELMI owned by any other company. Issuance of e-money, when included in the definition in the Directive, should meet the same requirements reflecting for one risk, consumer protection and financial stability. This reasoning will apply to NON-HYBRID e-money issuers, which have payment as core business. HYBRID issuers, with core commercial activities other than payment, should not be regarded as issuers of e-money regulated in the Directive, and should fall out of the scope of the Directive and the definition (ref. Guidance Note 2 ). In addition and in relation to the above mentioned, we encourage and welcome a market analysis, which accounts for questions such as are ELMIs operating or competing in the same market as credit institutions? If the answer to this question is no, or even ambiguous, level playing field must be taken into less consideration when reviewing the Directive. Logically, if not operating or competing in the same market, level playing field is not relevant. b) Has a level playing field between ELMIs and other pre-paid payment service providers issuing E-Money been achieved? This is also a question of whether or not ELMIs and other pre-paid payment service providers operate or compete in the same market. HYBRID pre-paid service providers, whose activity is not comprised by the Directive, ref. Guidance Note, have in general a limited service in the market and the issuance of funds by these providers is not accepted as means of payment by others than the issuer itself and his close business partners delivering for instance ring tones, games and other digital mobile content. HYBRID institutions carry out payment services as an addition to their core business. NON HYBRID institutions carry out payment services as their core business. This important difference is reflected in the mentioned Guidance note and should prevail in this review process. 2 Guidance Note: Application Of the E-Money Directive to mobile operators 3

4 c) Has the Directive encouraged competition? If so, is competition between institutions issuing E-Money fair? The Directive has probably reduced the number of potential competitors. In this emerging market where regulation, business models and revenue are highly uncertain, a Directive which increases start up and operational cost and maintains legal uncertainty will contribute to less incentives and higher barriers to enter the market. Traditional credit institutions have several advantages compared to new entrants, and any additional costs will hamper the development of competition. The Directive was partly initiated by the banking industry and the introduction of level playing field between new entrants and the banking industry has cemented the advantages of the banking industry. This has not encouraged fair competition. d) Has the Directive encouraged new market entrants? We believe that the Directive has a negative effect on new entrants due to increased start up and operational cost, legal uncertainty and other disadvantages compared to the credit institutions. 2) Primary goals of the e-money Directive Legal certainty a) Have the harmonized provisions of the E-Money Directive eliminated legal uncertainty in the field of E-Money? There will always be uncertainty involved when for instance interpreting what kind of issuance of E-Money is included in the Directive. However, the Directive has ensured awareness on some questions and answers that used to be very hazy and unattended. An elimination of uncertainty is by principal not reachable, but Telenor claims that the Directive has contributed to legal awareness, if not certainty. Legal uncertainty is created by the definition of e-money. It was certainly not the intention to regulate NON HYBRID institutions, such as mobile operators, but the definition made the legal environment highly uncertain. The definition in the Directive needs to be clearer and by that we suggest narrowed scope. Another factor that contributed to legal uncertainty is the option for the national authorities concerning the implementation of waivers. Member states can waive some or all provision given certain requirements. Telenor believes that an addition to legal certainty is to remove options for Members states as regards waivers, and introduce shall -type provisions. The waivers, especially Article 8, 1, c), (i) and (ii), need to include closely related third parties such as third parties delivering mobile content services to customers of the mobile operators. b) Does the Directive establish the conditions necessary to ensure that any kind of E- Money issuance takes place within a clear legal framework? There will always be a borderline issuance of E-Money, which will require thorough interpretation of the articles in the Directive, and might thereby create uncertainty whether the issuance is included in the Directive or not. However, the current Directive has not been satisfactory on this matter, ref. mobile operators issuance of pre paid funds in relation to the use of telecommunication services and third party services. The revision of the Directive should aim at clarifying what type of e-money issuance falls outside the scope of the Directive. 4

5 There seem to be considerations that are implied by the current Directive. These relevant considerations should be explicitly expressed. For instance: What are the reasons for the exemptions in Article 2? The review of the Directive should focus for instance on the relevant difference between companies which have payment as core business (NON HYBRID) and companies that have payment as a service feature supporting core business other than payment (HYBRID). The waivers should be extended with regard to the HYBRID institutions. c) Does the Directive establish market confidence in, and public awareness of, E- Money? We believe that the Directive establishes some sort of awareness, but not confidence. The public in general is not familiar with the Directive and how it secures the rights of the bearer. Little communication about the Directive has reached the bearers, and the public awareness is likely to be much less than wanted. 3) Primary goals of the e-money Directive Prudential rules a) Has the regulatory prudential framework achieved its objective of ensuring stability and soundness of issuers? Without the regulatory framework the stability and soundness of issuers would depend on the accountability of the individual issuer himself. However, we are not aware of lack of stability or soundness of issuers prior to the Directive when issuers were regulated by dispensations from existing regulations. b) Has the regulatory prudential framework increased business and consumer confidence in E-Money products? Increase in confidence is largely about information. The Directive is most likely a topic discussed by the industry, and as claimed above, not communicated to the public in a satisfactory manner. The mobile operators have since the late nineties issued prepay accounts to purchase for instance airtime, person-to-person SMS and third party delivered content services. There has been no lack of consumer confidence, supported by substantial growth in the prepay segment, in spite of potential regulation shortage prior to the Directive. This fact needs to be addressed in the review of the Directive, and should be reflected in the risk assessment and bearer protection. 4) Primary goals of the e-money Directive time proofed a) Has the regulatory framework of the E-Money Directive assisted the development of E-Money in the context of electronic commerce and avoided hampering technological development? The market mainly drives development of technology and electronic commerce. With few successful ELMIs and a limited E-Money issuance activity in the Norwegian market, it is difficult to assess what contribution the Directive has had in terms of assisting the development. With legal 5

6 uncertainty and increased barriers to enter the market, it is likely that the Directive has not assisted the development. b) Has the Directive encouraged technological innovation? See answer above. There is no incentive in the Directive to drive technological innovation. 5) Primary goals of the e-money Directive cross border services a) Has the E-Money Directive facilitated access by ELMIs from one Member State to another? Not to our knowledge. Telenor, owning the Smartcash AS (licensed ELMI), has not considered cross border service. The opportunity in the Directive to provide cross border services is believed to be a condition for development and growth in the future. b) To what extent has the E-Money Directive facilitated integration of E-Money Market across the EEA? No integration to our knowledge. 6) Primary goals of the e-money Directive technology neutrality a) Has the regulatory framework of the E-Money Directive enabled the development of E-Money unimpaired by strict technological rules? The Directive contains few restricting technological rules, and has not restricted the development of E-Money. b) To what extent has the regulation of E-Money succeeded in its original aim of remaining technologically neutral? The Directive is technologically neutral, but is not proportionate when it comes to risk assessment and scope of the Directive. Technology is only one concern and driver in this market. Business models, attractive offers to the consumers, etc. are more important to succeed than technology itself. 7) Goals of the E-Money Directive a) Do you agree that the original goals of the E-Money are those, which the Commission has identified above? Telenor has no objections as to the identified goals of the E-Money Directive. b) Is there a risk that the goals as set out above conflict with one another (e.g. the need to ensure stability and soundness vs. encouraging new market entrants and assisting the development of E-Money)? 6

7 Objectives have a nature of being in a conflict with each other. And surely, encouraging new market entrants vs. stability and soundness, and even more relevant, encouraging new market entrants vs. level playing field, will conflict with each other. The Commission will have to assess which goal is the most important based on this consultation process. If development is identified as more important than level playing field, the choice is obvious, ref. comments on level playing field mentioned above. c) Is there a need to re-assess the original goals and to perhaps establish new goals? If so, what should these be? Telenor believes that new market entrants are more important than level playing field at the current stage of the E-Money market. New goals should focus on development, decreasing instead of increasing cost base, lower barriers of entry, encouraging market establishment and growth. For instance level playing field could be de-emphasized by applying the same set of regulations for ELMI s independent of ownership or relation to business domain. An ELMI owned by a bank should have the same requirements as an ELMI owned by an E-Commerce company. In fact, level playing field could be considered as a goal not well founded. (Issuance of surrogate for coins is issuance of surrogate for coins independent of the ELMI s origin or ownership). Consequences should be: - Limiting the scope of the Directive - Risk assessment for issuance of coins substitutions, not credit or bank enterprise risk assessment. d) Should e.g. establishing consistency with the New Legal Framework for Payments be considered as a new goal? Certainly. It is very important to ensure consistency and avoid any contradictory overlap that would increase legal uncertainty and decrease market incentives. 8) Protection of e-money bearers a) Has the Directive created an appropriate legal background to protect E-Money bearers? Reference is made to 3) b. Given the situation before and after the introduction of the Directive, the bearers have a better protection. What about bankruptcy regulation? Will bearers be redeemed in case of bankruptcy? Telenor Mobil, together with consumer authorities have introduced redeemability for prepaid airtime. Reference is made to accountability of issuer. b) Have there been cases of consumer detriment caused by the lack of adequate measures to protect E-Money bearers? Not that we are aware of. 7

8 c) Is there a need for additional measures aimed at the protection of bearers of electronic money? No. Consumer protection is considerable taking into account for instance the small average amounts issued by ELMIs today. Also, bearers will lack incentive to lock in too much dead money in their E-Money purse. d) Do you think that E-Money should be covered by a guarantee scheme? Yes, as long as it is flexible and strictly related to the sums at risk. The benefit would be that such a rule would not have a direct impact on the design of the service and could therefore be more easily implemented than rules such as redeemability, which have a direct impact on the design of the service and are therefore costly and cumbersome to put in place by providers which may have another business than the e-money issuance. e) If so, how should it be funded? It should be funded by the service provider itself. 9) Capital requirements a) Is there a need to review provisions on initial capital and ongoing own funds requirements? Most importantly: they must reflect real risk. It is believed that many ELMIs could exist without a full license due to the threshold in the Directive. But without a full license, for instance cross border activity is difficult or impossible. An ELMI constituted on waivers could be exempted from the Directive completely or partly. It is likely to believe that provisions concerning initial capital and ongoing own funds requirements would be exempted. This indicates that the thresholds of present Directive do not represent the risk at hand. Requirements regarding initial capital and ongoing own funds are contributing to increased establishment and running cost, and should be decreased to strengthen establishment, innovation and growth. Every penny saved on administration/regulatory cost could be used to invest in development, customer acquisition, etc. b) Are the requirements of the Directive proportionate to risks E-Money institutions are exposed to? Ref. answer above. This does not seem to be the case. Requirements are not proportionate to risk exposed to issuers, and should be lowered. 10) Waivers a) What has been your practical experience of the application of waiver rules? As regards Telenor s mobile operation in Norway, Norwegian authorities waited for the Guidance Note before enforcing any regulation. Telenor Mobil is not considered as an issuer of E-Money regulated by the national implementation of the directive. Telenor s prepaid product, where a customer can buy digital content from closely related third parties, falls outside the scope of the national E-Money provisions. On the other hand, in Hungary for instance the waivers were not implemented at all into national regulation, thereby creating a very hostile legal environment for mobile payment services. 8

9 b) Do the existing rules correspond to the needs and realities of E-Money business? For HYBRID institutions, provided that conclusions in the Guidance Note will be absorbed in the reviewed Directive, clarity will be achieved that meets with needs and realities. For ELMIs at least two improvements should be considered: - a change from can to shall type waivers - extension of the opportunity to provide cross border services in spite waivers being applied. c) Should the rules on waivers be changed, and if so in which way? See above, last section. Suggested waiver implementation for HYBRID institutions is a widening of the scope in Article 8, regarding close financial or business relationship. The wording such as common marketing or distribution scheme should be deleted and substituted with a sentence that captures the essence in for instance the cooperation between third parties selling digital content to mobile operators customers. This could be for instance to keep close financial or business relationship, which will be sufficient regarding waivers for HYBRID institutions. d) Could the extensive and consistent application of waivers encourage E-Money issuance at national level? Yes, without doubt. e) Should the threshold of financial liabilities ( 6 million) related to outstanding E- Money be amended or removed? The amount should be flexible subject to the development and risk of e-money business. A predefined amount is not the answer. In the case of amendment, it should be increased. f) Is the amount of maximum storage at the disposal of bearers for the purpose of making payments ( 150) still relevant in the case of a waiver? It should be increased. Current e-money issuance per transaction is low, and the maximum storage amount only gives directions as to how the service should be designed. g) Is there a need to allow the competent authorities of Member States to waive the application of provisions of the Directive in other specific cases not provided for in the Directive? Yes, national authorities could encounter new business models and diverging concepts and should be able to grant waivers authorized by a general waiver clause. h) Should the waiver be granted automatically or should every waiver be decided by the competent authority case by case? 9

10 The e-money issuers should have a notification duty and the waiver should be given automatically for standard cases (if the competent authority has no objections or does not have to examine the case further). The authorities should decide on a case by case basis when a company reports waiver issues that fall outside the scope of standard waiver cases. 11) Interest payment a) Are there any examples of ELMIs having offered to pay interest on E-Money or demanding the right to pay interest? Not to our knowledge. b) Is there a need to prohibit interest being paid on funds received in exchange for electronic money? If there is a market interest in paying interest, as a mean to attract customers, the Directive should apply provisions similar to those regulating deposit banks. 12) Definition a) Should the definition of E-Money institution be broadened/narrowed to cover/exclude institutions issuing a prepaid means of payment for their core service but which may also issue E-Money as a non-core part of their business (e.g. mobile operators and other hybrid institutions )? Pre-paid means of payment should be covered by the new payment Directive. They are a sub-set of payment services. Alternatively the definition should exclude HYBRID institutions, through the definition itself or by means of waivers. b) Should a special EU regime be introduced for institutions issuing E-Money as a noncore part of their business (e.g. mobile operators and other hybrid prepaid instrument providers)? The HYBRID institutions, such as Telenor, have operated for several years (in Norway since 1999) with third parties selling digital content. Telenor has not registered anything else but enthusiasm from customers, third parties and authorities. Consumer authorities were skeptical in the beginning, but confidence has grown as a result of tight collaboration with them. To answer the question, one has to ask some elementary questions. For instance: - What should the EU regime resolve or prevent? - Is there a threat to consumers, financial stability, mobile operators or any other player in this market? The regulation should be proportionate with the answers to these questions. 13) Definition a) Is the definition of E-Money appropriate and adapted to any kind of E-Money issuance? 10

11 Provided that HYBRID institutions fall outside the scope of the definition, and the definition reflects the original intentions of the Directive, the definition is appropriate with regards to HYBRID institutions. b) For the sake of clarity and to avoid any legal uncertainty, does the definition of E- Money need to be clarified? Has the definition of E-Money given rise to different interpretations, either across different business models or as a result of different Member States interpretations? The waivers or the definition should reflect the difference between NON HYBRID ELMIs and HYBRID institutions. We believe that the waivers have generated problems through different interpretations. c) Does the definition of E-Money correspond to the way the market has developed or is likely to develop? If the definition in the Directive aims to be technology neutral and proportionate to risks, it will correspond to the future needs. d) Is there a need to review the definition of E-Money? Yes. Reference is made to answers above. e) Do the three criteria in the definition of E-Money (stored on electronic device, issued on receipt of funds not less than monetary value issued, accepted by undertakings other than the issuer) constitute the determining elements as to what really constitutes electronic money? The last element (accepted by undertakings other than the issuer) is the main problem, ref. answer above. One could question whether stored on electronic device is relevant. When new bio storage devices or devices that do not match the definition enter the market, the definition has to be changed. The definition is not really technology neutral; one could store money mechanically, even though this would be ineffective and old fashioned. f) Would it be appropriate to introduce a reference to "any prepaid float/funds allocated to payment? The new Payment Directive should cover this. g) Which payment instruments in your experience/country fall under the definition of E-Money? Should the definition of E-Money cover pre-paid products of mobile operators? NON HYBRID issuers fall under the definition of e-money. HYBRID issuers do not. 14) Restrictions of activities a) Is the limitation of E-Money institutions activities too restrictive? 11

12 This has not been an issue. But it is clear that NON HYBRID E-Money institutions, provided the same requirements as other payment institutions, should have the same opportunities as financial institutions regarding capitalization on deposit funds. b) Does the limitation of activities discourage new entrants, restrict competition or hinder innovation? Not to our knowledge. c) Does the limitation of activities contribute to preserving a level playing field between ELMIs and other credit institutions or alternatively disadvantage ELMIs in comparison with other credit institutions that issue E-Money? Might contribute to disadvantage ELMI s. d) Does the restriction on the granting of any form of credit have an impact on the payment possibilities offered through E-Money instruments? For example, does the delay in some payment transactions constitute credit in your experience/member State? No. 15) Applications of banking Directives a) Has the application of the passporting provisions of Directive 2000/12/EC given rise to any specific problems? Not to our knowledge. b) To what extent has the single passport been used by licensed ELMIs? Telenor did not take advantage of these rights provided by Directive 2000/12/EC, i.e. it did not establish ELMIs in member states based on the license it obtained in Norway. We have no information regarding other ELMIs. c) Is it still valid to define an ELMI as a credit institution under Directive 2000/12/EC (as amended) despite the fact that ELMIs are legally barred from granting credit and from paying interest on funds received in exchange for E-Money issued? The answer to this question is clearly no. ELMI s do not grant credit, and should of course not be considered as a credit institution. 16) Deposit taking a) Is it still valid to distinguish between the different nature of the issuance of electronic money and a deposit-taking activity in the interests of bearer confidence? Yes. Issuance of e-money is supposed to substitute coins. Deposit taking, with interest given to the customer, is another business area. b) If funds received are immediately exchanged for E-Money, at which point in time does the conversion into E-Money actually take place? 12

13 Since the necessity and meaning of the condition in Art. 2 (3) if funds received are immediately exchanged for electronic money is unclear, it should be deleted. Issuance of electronic money is not deposit taking. c) Should the notion of deposit-taking in Article 3 of Directive 2000/12/EC be clarified? Not necessary. 17) Redeemability a) Does redeemability at par value pose any special problems for E-Money issuers? The amount of funds held on prepaid accounts provided by mobile operators is usually relatively low. (The majority of prepaid customers usually opt for the least expensive top-up cards. In some countries these are as cheap as 15.) Even less the amount that customers spend on services provided by third parties that would qualify as e-money as per the Guidance Note. On the other hand, the number of prepaid customers is high relative to the entire customer base (in some Telenor subsidiaries the prepaid ratio is as high as 80%). Therefore, a full redeemability obligation, taking into account the large number of prepaid customers and the rather low average amounts kept on prepaid accounts, entails a disproportionately harsh administrative burden for mobile operators, especially if we consider that the purpose behind redeemabiliy is not applicable to mobile prepaid accounts (see also the answer below). Therefore this obligation creates a serious problem in the sense that it impacts the design of the service. b) How could this rule be adapted to institutions issuing E-Money as a non-core part of their business (for example, mobile operators) for which the E-Money float on prepaid cards or accounts is only known ex post when customers have purchased goods and services from a third party? The question should not be how to adapt this rule to mobile operators, but whether this rule serves any purpose, whether redeemability is necessary in the case of mobile prepaid accounts? The primary function of prepaid accounts still is to use them for mobile telecommunication services, not for the mere storage of e-money, like in the case of electronic purses. The arguments of the European Central Bank, such as the need to preserve the unit of account function of money and the constraint on issuance of e-money, thus the purpose behind redeemability does not apply to mobile prepaid services, as long as the amount spent by mobile subscribers on third party goods and services from their prepaid accounts does not reach a certain level. How is reedemability to be interpreted in the case of mobile prepaid accounts at all? In case a customer wishes to redeem the amount on his account, how can he prove that he would have used that amount to purchase goods or services provided by third parties, i.e. that the amount was destined to turn into e-money and not into voice call minutes or text messages in which case there would be no redeemability obligation? c) Is a minimum threshold of EUR 10 for redemption at par value still relevant? Provided that the current obligation of redeemability is maintained - in view of the answer provided to a) above the answer is yes. 13

14 18) Limitations of investment a) Have the provisions of the Directive on limitation of investments achieved their aim of establishing a level playing field between ELMIs and credit institutions? b) Are the provisions of the Directive too restrictive for ELMIs? c) If so, have they deterred new market entrants, restricted competition or hindered innovation? 19) Money Laundering a) Do national customer due diligence provisions, such as "Know Your Customer", record keeping requirements and other established principles in banking law pose specific problems to the issuance of electronic money despite the exemptions foreseen for E-Money? If so, which? Without exemptions foreseen for E-Money, money-laundering provisions could be devastating for E-Money issuers. One of the key ideas is of course electronic customer acquisition. This would be substantially hampered with a fully applied know your customer provision. However, the Norwegian Financial Authority has given ELMIs exemptions from money-laundering provisions, reflecting risk in current operations. The exemptions are temporary, which increases legal uncertainty, but as they appear they render possibility to continue development without substantial changes in the concepts. A know your customer provision fully applied would make services too difficult to use, customer acquisition very difficult and apply a cost for ELMIs beyond revenue potential at this stage. b) Is it possible to sell anonymous pre-paid cards (or other electronic devices) in your country? Mobile service providers have a legal duty to register all pre-paid customers. Anonymous pre-paid cards may not be distributed in Norway. 20) e-money market development a) Would you agree that the E-Money market has either failed to develop to or not yet reached its full potential? The E-Money market participants have failed in their assumption that it would be easier to change consumer behavior with regards to E-Money payment. It is an expensive transition to make, and demands substantial investment. The E-Money market has therefore not yet reached its full potential. b) If so, what are the main reasons for the limited development of the E-Money market? 14

15 Reference is made to answer above. Also different solutions and design of e-money payment solutions offered to the customers is contributing to limited development. The increase in barriers introduced by the Directive is also a significant reason. c) Have any particular obstacles constrained the E-Money market growth across the EEA? One reason is the different interpretation given by Member States to the Directive. d) What are the prospects for the future development of E-Money? If major market players could collaborate with one simple and easy to use solution, e-money could change the way people do micro to medium transactions. A revised Directive should encourage investment and participation in such a collaboration by decreasing demands. e) Is the E-Money Directive adapted to the market conditions? No, because it does not recognize that some providers may have other businesses, on which they rely to gain economies of scale and scope (thanks to which they can compensate the lack of margins). f) If not, are there any amendments to the Directive, which are needed in order to reflect the E-Money market developments, especially as regards technological innovations? It isn t really a question about technology more than it s a question about services, and how the user interfaces the services. Easy to understand and easy to use services are crucial in order to succeed. Any provisions, which hamper the engineering of the service design will in principle endanger market development, and should, to the extent possible, not be introduced. g) Are there any obstacles in the taxation area constraining the E-Money market development? h) What changes, if any, might be needed to the E-Money legal framework in the light of forthcoming Directive on Payment Services (New Legal Framework)? Should the Directive be kept and not repealed, it is critical that the two directives are consistent and homogeneous. Their scope should be clearly identified and defined. Prepayment services, by definition, should be considered as a subset of payments, not as e-money. 21) Other issues? The Norwegian mobile content market has given birth to third party companies generating considerable revenue. If a revised Directive regulates mobile operators, introducing costly requirements, the mobile operators will be forced to assess whether it is reasonable to continue their collaboration with third parties. If mobile operators wind up such collaboration because thereby they fall beyond the scope of the regulation, and offering content to customers in their own name and brand instead, a prosperous third party market will be partly destroyed. 15