Green Paper on retail financial services: better products, more choice, and greater opportunities for consumers and businesses

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1 Case Id: f2d98202-e c-b0a6-b4d cd Date: 18/03/ :57:00 Green Paper on retail financial services: better products, more choice, and greater opportunities for consumers and businesses Fields marked with * are mandatory. Introduction The Green Paper seeks the views on how to improve choice, transparency and competition in retail financial services to the benefit of European consumers. It also inquires on how to facilitate cross-border supply of these services, so that financial firms can make the most of the economies of scale in a truly integrated EU market. Finally, it is discussing the impact of digitalisation on retail financial services with a view to allow for growth of innovative solutions in this area in the EU. Please note: In order to ensure a fair and transparent consultation process only responses received through our online questionnaire will be taken into account and included in the report summarising the responses. Should you have a problem completing this questionnaire or if you require particular assistance, please contact fisma-retail-green-paper@ec.europa.eu. More information: on this consultation on the Green paper on the protection of personal data regime for this consultation 1. Information about you 1

2 * * Are you replying as: a private individual an organisation or a company a public authority or an international organisation Name of your organisation: Danish Bankers Association Contact address: The information you provide here is for administrative purposes only and will not be published tnt@finansraadet.dk * * Is your organisation included in the Transparency Register? (If your organisation is not registered, we invite you to register here, although it is not compulsory to be registered to reply to this consultation. Why a transparency register? ) If so, please indicate your Register ID number: * Type of organisation: Academic institution Consultancy, law firm Industry association n-governmental organisation Trade union Company, SME, micro-enterprise, sole trader Consumer organisation Media Think tank * Where are you based and/or where do you carry out your activity? Denmark * Field of activity or sector ( if applicable): at least 1 choice(s) Consumer protection General civil society representation (non-profit) Accounting Auditing Banking Credit rating agencies Insurance Financial intermediation Fintech firms 2

3 Pension provision Payment provision Investment management (e.g. hedge funds, private equity funds, venture capital funds, money market funds, securities) Market infrastructure operation (e.g. CCPs, CSDs, Stock exchanges) Social entrepreneurship t applicable Important notice on the publication of responses * Contributions received are intended for publication on the Commission s website. Do you agree to your contribution being published? ( see specific privacy statement ), I agree to my response being published under the name I indicate (name of your organisation/company/public authority or your name if your reply as an individual), I do not want my response to be published 2. Your opinion Disclaimer: the proposed options as responses to some of the questions do not commit the European Commission to any follow-up action. The questionnaire contains 34 questions which seek the views of a broad range of stakeholders. However, not every question will be relevant to everyone and therefore stakeholders are not obliged to respond to all the questions. The questionnaire below follows the structure of the Green Paper in which Section 3 outlines all the consultation questions. Section 3: Better products, more choice and greater opportunities for consumers and businesses Please refer to section 3 of the Green paper questions. to read context information before answering the If you are a firm 1A. For which financial products could improved cross-border supply increase competition on national markets in terms of better choice and price? Current accounts 3

4 Saving accounts Mortgage credit Consumer lending Payment services (e.g. mobile payments) Car insurance Life insurance Private health insurance Saving and investment products Please specify for which other financial products could improved cross-border supply increase competition on national markets in terms of better choice and price: In general, we subscribe to the argument that improved cross-border supply of financial services will affect conditions for competition in the national markets. In principle, this would apply regardless of product. However, as market practices and local regulation differ significantly across markets in EU, we believe that improving cross-border competition will be an extensive and complex long term harmonization project, also reaching beyond the banking sector itself, e.g. involving tax regulation, public authorities, and labor and housing market conditions. For simpler products, e.g. savings accounts, payment services, and consumer loans, competition could perhaps be supported by means of further standardisation or product labelling of certain products. But in this respect we believe that much has already been achieved with the recent adoptions of the IFR, PSD2, and PAD. Combining this with deposit guarantees, we believe that new market developments will take place in the years to come, and that these developments may be further fuelled by the ongoing digitalisation of the financial sector. We therefore recommend to await further regulatory actions/market interventions until the market has settled to this newly updated regulatory environment. However, it should also be noted that for Danish/rdic customers, the notion of acquiring cross-border financial services implies currency conversion risks. Thus it would appear less attractive for the majority of consumers. Regardless of product, we also believe that the conditions for customer on-boarding (the process that allows a customer to acquire any financial service) is a key issue and a high-priority focus area. Simple, consumer-friendly, AML/KYC compliant and fully digital on-boarding processes are key to successful cross-border delivery of financial services, and thus for consumers and providers of financial services to benefit the most from the opportunities provided by digitalisation. 4

5 If this issue is addressed effectively, perhaps even in joint efforts between banks and public authorities, a key practical obstacle for cross-border competition will be removed, and significant additional benefits to society may be achieved alongside. wise, the efforts to spawn further competition, may in effect be reduced to providing consumers with window-shopping opportunities as neither consumers nor service providers in reality will be able to benefit much from any changed market conditions. As one specific example, harmonisation is also needed within asset management. The asset management industry in Europe manages more than 11 billion, but investment funds are treated very differently in the member states when it comes to tax. This makes it very difficult for financial service providers to provide services cross-border. In some countries such as Denmark the costs of managing assets in collective investments schemes are relatively low. Retail investors from other EU countries do, however, not have the possibilities to invest in collective investment schemes which are managed out of Denmark. If the framework for cross-border management is enhanced including the tax issues this will give the retail investors various new options when seeking the best investment services. If you are a consumer or consumer organisation... 1B. Which financial products would you be most interested to buy cross-border from other Member States if they suited your needs better than products available on your local market? Current accounts Saving accounts Mortgage credit Consumer lending Payment services (e.g. mobile payments) Car insurance Life insurance Private health insurance Saving and investment products If you are a firm... 2A. What are the barriers which prevent firms from directly providing financial services cross-border? 5

6 Language Differences in national legislation Additional requirements imposed by national regulators Impossibility of verifying the identity of cross-border customers Lack of knowledge of other markets Cost of servicing clients cross-border (without local infrastructure) EU passport available Please specify what other barriers prevent firms from directly providing financial services cross-border: While we recognise and support the Commission's aim of increasing choice and competition in financial services through the single market, it needs to be recognised that markets for financial services are still, to some extent, national in nature. Danish Banks, have in recent years invested in national solutions and as far as possible, along the lines of the SEPA standards but still with a certain national "flavour". It must also be taken into account that for countries outside the Euro area, the currency dimension to the cross-border provision of financial services remain, and it cannot alone be overcome by standardisation. Hence, it is not only language that is a barrier for the cross-border provision of financial services: lack of customer demand and national solutions are important ingredients as well. To our mind, this calls for a long-term vision towards the single market for financial services rather than a quick "fix-it-all now" approach. As stated above, the most important requirement for consumers to be able to access a financial product (digitally) outside their country of residence is access to uniform, pan-european principles/methods of enrollment e.g. entailing a KYC pass-porting regime. Secondly, a number of physical ties remain regarding the provision of a comprehensive set of financial services (which would be the expectation of many consumers), e.g. regarding cash services and security for loans/mortgages. If you are a consumer or consumer organisation... 2B. What are the barriers that prevent consumers from directly purchasing products cross-border? Language Territorial restrictions (e.g. geo-blocking, residence requirement) 6

7 Differences in national legislation Lack of knowledge of the offer of products in another Member State Lack of knowledge of redress procedures in another Member State 3. Can any of these barriers be overcome in the future by digitalisation and innovation in the FinTech sector? 3.1 Please specify which of these barriers can be overcome in the future by digitalisation and innovation in the FinTech sector: Language Territorial restrictions (e.g. geo-blocking, residence requirement) Differences in national legislation Additional requirements imposed by national regulators Impossibility of verifying the identity of potential cross-border clients Lack of knowledge of other markets Lack of knowledge of the offer of products in another Member State Lack of knowledge of redress procedures in another Member State Cost of servicing clients cross-border (without local infrastructure) EU passport available Please specify what other barriers can be overcome in the future by digitalisation and innovation in the FinTech sector: The digital evolution is rapidly changing the way people act and interact and in particular the increasing importance and widespread use of smartphones are changing the needs and expectations of bank customers. We thus agree that digitalisation is one avenue through which the goals of the Green Paper can be realised. Digitalisation provides banks and other providers of financial services with the opportunity to offer new and innovative products to their customers and to streamline many processes which are currently paper-based or manual. By its very nature, digitalisation can be border-less and scalable and can therefore increase innovation and choice across the EU. However, digitalization cannot solve - but can be restricted - by some of the issues mentioned. In particular, differences in national legislation and territorial restrictions can hold back to evolution of proper pan-european 7

8 products and solutions. Thus digitalization is not a magic wand but a building block in creating a more integrated market for retail financial service in Europe. 4. What can be done to ensure that digitalisation of financial services does not result in increased financial exclusion, in particular of those digitally illiterate? Improved access to digital means Digital training offered by the financial industry Digital training offered by NGOs Digital training offered by public authorities Please specify what else can be done to ensure that digitalisation of financial services does not result in increased financial exclusion, in particular of those digitally illiterate: While agreeing with the benefits described, we do in general not see indications of digitalization leading to increased financial exclusion, which e.g. the massive and rapid penetration of mobile services including financial services - also illustrates. Lack of financial understanding has always been an issue, but the digital evolution potentially adds an extra layer to this, as digital competencies are now also needed to obtain some financial services. For banks it is also important digital services are readily accessible to all customers regardless of their social background and/or digital skills. More financial competent customers will be better able to pick and choose between products, increasing the value of the banks products and increasing competition in the sector. As banks move towards increasingly digital products, this also includes the customer s ability to access and understand these through digital channels. Again, banks should contribute to customers ability to access and use digital products to ensure these are used as intended and that the full benefits of digitalisation are realised. However, we believe that banks are aware of this - and already play an important role here. Through the deployment of a nation-wide digital ID and simple, customer focused digital solutions, the Danish banks have also contributed significantly to the general digital competences of the Danish population in general. Banks would be in a position to contribute to this on a European scale as well. We thus believe that banks have already taken on a large responsibility to educate and support their customers, and we expect to do so also going forward. 8

9 5. What should be our approach if the opportunities presented by the growth and spread of digital technologies give rise to new consumer protection risks? As always, regulators need to follow developments and ensure that regulation stays up-to-date. For more, see answer to question Do customers have access to safe, simple and understandable financial products throughout the European Union? Please explain your answer to question 6: While it is difficult or us to relate to the situation in other countries, it is our view that Danish bank customers have access to safe, simple and understandable financial products. However, it should be noted that current regulatory requirements to provide extensive consumer information may risk consumer information overload and if so, the benefits of regulation aimed for may not materialise. 7. Is the quality of enforcement of EU retail financial services legislation across the EU a problem for consumer trust and market integration? Please explain your answer to question 7: We believe that standardisation and harmonisation of rules and regulations are key ingredients in achieving the broader long-term goals of the Green Paper. This will enable banks to scale products and services cross-border without having to deal with unnecessary and burdensome barriers. As per usual, however, this is a fine balance act between harmonisation and allowing innovation to occur. However, a key cornerstone in any effort to promote the single market in financial services must surely be the need to create a common, harmonised regulatory framework across the EU. A harmonisation of consumer and business rights and obligations will create the necessary preconditions for further integration of the markets for financial services in the EU. 9

10 Furthermore, a level playing field - across suppliers and across borders will create the best opportunities to harness the potential benefits of the digitalisation on an EU-wide scale. wise, the risks are threefold: firstly, it risks hindering the emergence of proper, pan-european solutions as national rules hinder the "export" of solutions to other jurisdictions - as e.g. illustrated by e.g. the challenges of promoting the cross-border use of electronic mandates for direct debits in the face of very different legislation on digital signatures across Europe. Secondly, there is a risk of creating an environment where regulation is directed at the type of institution rather than the risks or the productsisolutions that regulation is actually trying to address. Finally, a risk of regulatory arbitrage exists, with companies setting up in countries with less stringent rules/enforcement, still being able to deliver their services across the EU given the global nature of digital services. The exponential development of digital capabilities gives rise to particular challenges for regulators and lawmakers. Regulation is, almost by nature, backward looking and is often national, while digitalisation creates a need to be forward looking and international. To fully realise the benefits of digitalisation going forward, regulation should recognise the schism between the physical and digital worlds. Also, creating a regulatory and supervisory environment, that allows both banks/incumbents and new players to develop and test new products and services without the incurring the normal regulatory consequences is important in order for innovation to take place while maintaining a level playing field. 8. Is there other evidence to be considered or are there other developments that need to be taken into account in relation to cross-border competition and choice in retail financial services? The period has since the financial crisis seen a whole host of new regulation coming into force some of which are not yet fully implemented, and therefore the results cannot be observed yet. Considering the next steps, we encourage the EU Commission to take into account the effects of recently adopted legislation. We therefore call for proper impact assessments before considering further regulation. This will also be in line with the EU Commission's agenda on better regulation. An agenda we fully support. Furthermore, we find it is crucial to align this work with the work on the digital single market as many of the topics considered overlap. 3.1 Helping consumers buy products cross-border Knowing what is available 10

11 Please refer to section of the Green paper questions. to read context information before answering the 9. What would be the most appropriate channel to raise consumer awareness about the different retail financial services and insurance products available throughout the Union? Independent pan-european comparison websites, including the information on cross-border products Information campaigns by regulators Information campaigns by consumer organisations Marketing campaigns by financial services providers or their associations Financial intermediaries empowered to offer cross-border financial products 10. What more can be done to facilitate cross-border distribution of financial products through intermediaries? As a general comment, we believe that cross-border provision of financial services will evolve as and when there is a commercial consumer demand for such services - and see significant risks if this development is to be forced though via legislation. Again it should be noted, that for Danish/rdic consumers the acquisition of financial services may imply currency conversion risks regardless of being provided directly or through intermediaries. 11. Is further action necessary to encourage comparability and / or facilitate switching to retail financial services from providers located either in the same or another Member State?, at Member State level, at EU level If further action is necessary, what action and for which product segments? While we agree that allowing customers the possibility to switch between providers of financial services is key to ensure the necessary level of competition, this is an area where the (still) mainly domestic nature of financial services should be recognised. We believe that switching within national borders should be supported - as also required by the PAD - and in Denmark, banks have introduced a new electronic switching service which will make switching easier and faster. Given the low level of demand for cross-border switching, however, the business case for going further than required by the PAD does not exist. 11

12 In particular, the Green Paper mentions "full portability of bank account numbers" as one possible avenue to increase competition. As the entire current infrastructure is based upon current bank account formats, the investment needed to introduce such portability would be huge and would certainly not be commensurate with the benefits of doing this. The full effect of the PAD directive is still not clear - and as an absolute minimum, further work in this area should await clarity on the effects of this directive. 12. What more can be done at the EU level to tackle the problem of excessive fees charged for cross-border payments (e.g. credit transfers) involving different currencies in the EU? Aligning cross-border and domestic fees Before every transaction, consumers should be clearly informed what fee they will be charged and for comparison should be presented the fee for national payment Before every transaction consumers should explicitly accept the fee they will be charged further action is needed Please specify what else can be done at the EU level to tackle the problem of excessive fees charged for cross-border payments (e.g. credit transfers) involving different currencies in the EU: This is an area where the effects of recent regulatory initiatives, including PSD2 and the IFR, are yet to be seen. It should, however, be recognized that cross-border transfers between countries with different currencies, all else being equal, involve additional costs and complexities, and represent far lower transaction volumes than domestic payments (and thus fewer units to carry the costs involved). 13. In addition to already existing disclosure requirements*, are there any further actions needed to ensure that consumers know what currency conversion fees they are being charged when they make cross-border transactions? * Articles 59 and 60(3) of the revised Payments Services Directive (PSD2): European Parliament legislative resolution of 8 October 2015 on the proposal for a directive of the European Parliament and of the Council on payment services in the internal market and amending Directives 2002/65/EC, 2013/36/EU and 2009/110/EC and repealing Directive 2007/64/EC (COM(2013)0547 C7-0230/ /0264(COD)) further action is needed Before every transaction, consumers should be clearly informed what conversion fee they will be charged and for comparison should be presented the average market conversion fee (e.g. provided by the European Central Bank) 12

13 Before every transaction consumers should explicitly accept the conversion fee they will be charged Please specify what other further actions needed to ensure that consumers know what currency conversion fees they are being charged when they make cross-border transactions: As question Accessing financial services from anywhere in Europe Please refer to section of the Green paper questions. to read context information before answering the 14. What can be done to limit unjustified discrimination on the grounds of residence in the retail financial sector including insurance? While we agree that "unjustified" discrimination should not be allowed, it is important to recognize that residence can be a key factor in which products to offer to a given customer. This can e.g. relate to legal reasons (e.g. the physical location of the collateral in a mortgage loan), the provider's (lack of) knowledge of local risks within insurance or other informational, legal or operational restrictions. The need to provide cash services may also restrict the reach of services, and finally, the provision of pension services may be tightly connected to local collective labor market agreements and/or individual agreements between the employer and the employee. 15. What can be done at the EU level to facilitate the portability of retail financial products for example, life insurance and private health insurance? Prohibit insurance firms from geographically limiting cover to the country where the policy-holder is living Encourage insurance firm to sell insurance products with wide geographical coverage 16. What can be done at the EU level to facilitate access for service providers to mandatory professional indemnity insurance and its cross-border recognition? comments. 13

14 3.1.3 Having trust and confidence to benefit from opportunities elsewhere in Europe Please refer to section of the Green paper questions. to read context information before answering the 17. Is further action at the EU level needed to improve the transparency and comparability of financial products (particularly by means of digital solutions) to strengthen consumer trust? Please explain your answer to question 17: In order to be commercially successful, especially in a purely digital context, the quality and price of financial products and services must be easy for consumers to assess. However, as financial service providers compete on both price and service, it must be expected that these to some extent will differ due to the commercial market context and specific commercial profile of the service provider in question. While appreciating the need for transparency, we believe that the many initiatives introduced in recent years also aiming to improve transparency and comparability of financial products, e.g. PAD, MCD, PRIIPS and others will take effect. The market impact of these initiatives should thus be considered and evaluated before considering further regulatory actions or market interventions. However, as also indicated previously, current information requirements may lead to consumer information overload, and simplification should thus be an important area of concern. Furthermore, as seen in other areas, price comparison services (price portals) and other services exist to provide customers with guidance as to which financial service provider they should choose for a specific or more comprehensive need. As a general comment, consumer trust relies on many other things than transparency and comparability of financial products. 14

15 18. Should any measures be taken to increase consumer awareness of FIN-NET* and its effectiveness in the context of the Alternative Dispute Resolution Directive s implementation? * FIN-NET is a financial dispute resolution network of national out-of-court complaint schemes in the European Economic Area countries that handle disputes between consumers and financial services providers 19. Do consumers have adequate access to financial compensation in the case of mis-selling of retail financial products and insurance? Please explain your answer to question 19: Following the financial crisis, the Danish government set up a body to review the rules concerning access to financial compensation. Accordingly the recommendations from this body have been implemented in Denmark, and we believe that Danish consumers have adequate access to redress/ compensation. 20. Is action needed to ensure that victims of car accidents are covered by guarantee funds from other Member States in case the insurance company becomes insolvent? 21. What further measures could be taken to enhance transparency about ancillary insurance products and to ensure that consumers can make well-informed decisions to purchase these products? comments With respect to the car rental sector, are specific measures needed with regard to add-on products? 15

16 3.2 Creating new market opportunities for suppliers Meeting the challenges and opportunities presented by digitalisation Please refer to section of the Green paper questions. to read context information before answering the 22. What can be done at the EU level to support firms in creating and providing innovative financial digital services across Europe, with appropriate levels of security and consumer protection? Here we would reiterate the need to allow effects of recent regulatory initiatives to make themselves felt before further is considered. However, the appropriate level of security is a key area of concern. While the Green Paper does not dwell much upon it, cybercrime and cybersecurity are key focus areas in the quest for the common market in financial services. An increasingly digital world is also a world in which cybersecurity becomes increasingly important. Cybercrime has become big business, and IT criminals are more sophisticated and professional than previously seen - and sometimes threats even come from governments in other parts of the world. This is an area where banks have much to offer. Banks have been working with IT and data security for a number of years to ensure the integrity, confidentiality and accessibility of systems and data. Despite the dent in banks' reputation following the financial crisis, customers retain faith in, and expectations of, banks' ability to keep funds and data secure. Trust a fragile thing, however. Banks should thus be able to leverage this trust and reputation for security and should work together - and engage with relevant stakeholders to ensure sharing of information and best practices and coordinated responses to threats and incidents. From a regulatory standpoint, risks in this area are manifold. The pace of technical development - and the changing security threats, require banks to be able to respond to these. Legislation needs to be agile enough to allow banks to respond to changing threats and to adopt new security measures when appropriate. Furthermore, legislation should allow banks to cooperate on security risks, despite rules on e.g. data protection. All providers of financial services (regardless of they are banks or not) face the requirement to identify customers, or be dependent on the same credentials as banks (e.g. when discussing TPPs in relation to PSD2). Highly user friendly eid systems and processes are a prerequisite here. 16

17 23. Is further action needed to improve the application of European Anti-Money Laundering legislation, particularly to ensure that service providers can identify customers at a distance, whilst maintaining the standards of the current framework? If further action is needed to improve the application of European Anti-Money Laundering legislation, particularly to ensure that service providers can identify customers at a distance, whilst maintaining the standards of the current framework, please state additional comments on possible actions (e.g. guidelines at EU level, etc.): The customer onboarding and identification process remains challenging due to lacking standards for identification, digital IDs and differing interpretations of Anti Money Laundering (AML) and Know Your Customer (KYC) requirements. Furthermore, there is a conflict between the old standard of banking being something customers do at their bank branch and the new standard being something done online. There is also a conflict between a move towards faster processing and more easily accessible banking products on one side and the effort to combat money laundering and terrorist financing on the other. We therefore suggest to investigate further how such processes can best be harmonised, and made suitable for fully digital customer on-boarding, e.g. by providing banks access to passport registries in order to validate passport data and photos, residency checks etc. 24. Is further action necessary to promote the uptake and use of e-id and e-signatures in retail financial services, including as regards security standards? If further action is necessary to promote the uptake and use of e-id and e-signatures in retail financial services, including as regards security standards, please state additional comments on possible actions: We share the Green Paper s view that e-identity is an area where more should be done. As both public and private services are increasingly provided online, the need for users to establish and confirm their identity online also increases. When transcending to an online universe, trust, security and proper authentication of the digital user become key parameters. The need for trusted e-identity and e-authentication mechanisms is paramount to the development of the digital internal market in general and for the internal market in financial services in particular, as also evidenced by the recent revision of 17

18 the Payment Services Directive. Also here, we believe that banks are key players. Banks have long-standing experience in establishing digital identities in the context of providing banking services online through internet or mobile banking platforms. Historically this has placed the banks in an ideal position to deliver identity services for business purposes and in a wider context; potentially in partnership with public authorities. Establishing a single solution for banks and public authorities increases recognition and usage and contributes to the user trust. In the rdics, a variety of solutions have been introduced, and both in Denmark, Sweden, rway and Finland, banks offer successful e-id schemes that are also used outside the financial sector. The Danish e-id solution, Nem-ID, is a single public and private solution with more than 4 million registered users and with the largest share of transactions coming from interactions with the banks. From the public perspective, banks have historically been a necessary partner as they have been able to contribute both know-how, transaction volumes and services that are frequently used - all ingredients that are key to successful implementation of an eid scheme. 25. In your opinion, what kind of data is necessary for credit-worthiness assessments? For providers of loans and credits, the data needed to assess credit-worthiness depends on both the size, purpose of the loan in question and the risk profile of the consumer. Thus the information needed would often include (not exhaustive): Profession Salary/income statements Tax statements Marital/family status Current debt level Expense budget Current housing If security is necessary to back the loan, e.g. if real estate property is involved, information on property value is relevant. 26. Does the increased use of personal financial and non-financial data by firms (including traditionally non-financial firms) require further action to facilitate provision of services or ensure consumer protection?, at Member State level, at EU level 18

19 If the increased use of personal financial and non-financial data by firms does require further action to facilitate provision of services or ensure consumer protection, please state additional comments on possible actions: This another area where harmonised and clear rules are needed and we hope that the coming General Data Protection Regulation (GDPR) can play an important role in this regard. It needs to be carefully assessed weather the DPR strikes the right balance between consumer protection and protection of data on the one hand and new innovations and a data driven growth on the other hand. Consumers expect providers of financial services to use customer data to improve services and offerings and their finances to be ever more customized and easily accessible across multiple platforms. To an extent, we therefore believe that is in the consumer's interest that banks are able to predict consumer needs and are able to offer the relevant products at the relevant time. There is thus a need for regulation to address how to balance the need for data protection against the use of data for legitimate and consumer-friendly purposes. Another key area for safeguarding consumer protection is to ensure that the DPR does not give rise to new obstacles for banks and other actors to build efficient (cross-border) regimes for the fight and protection against cyber crime. 27. Should requirements about the form, content or accessibility of insurance claims histories be strengthened (for instance in relation to period covered or content) to ensure that firms are able to provide services cross-border? 28. Is further action necessary to support firms in providing post-contractual services in another Member State without a subsidiary or branch office?, at Member State level, at EU level 29. Is further action necessary to encourage lenders to provide mortgage or loans cross-border? 19

20 29.1 If further action is necessary to encourage lenders to provide mortgage or loans cross-border, on which particular area should the action concentrate? Overcoming differences in private insolvency rules across the EU Developing common EU standards on property valuation Providing for effective access to collateral in case of consumer s default in other Member States Ensuring clarity of administrative and notary fees charged in other Member States Allowing for easier access to national land registers Facilitating access to land registers cross-border Improving availability of credit register data for creditworthiness assessments purposes Please specify on which other particular area the action should concentrate: While supporting the aim of facilitating a higher degree of cross-border mortgages/lending, we believe this to be a highly complex and challenging area to harmonise. Local mortgage markets are closely linked to the way the housing markets work, how property prices are set and how transactions in the market are conducted. This creates both practical and cultural obstacles for the cross border delivery of mortgages. In addition, different financing principles exist for the underlying covered bonds, and despite the introduction of the euro, the multitude of currencies that remain within the union also pose challenges for the underlying models as it may create currency mismatches for the supplier of financing if loans are granted in one currency and financing obtained in another currency. For banks, risk taking in cross-border lending must thus not be excessive, and if digital processes without physical presence is envisioned, numerous challenges exist, e.g. regarding access to land registries, access to trustworthy property valuation etc. For banks/lenders, uniform processes and regulation regarding repossession in court procedures would also be a major area of concern. Finally, seen from a Danish/rdic perspective, cross-border lending may imply a currency risks which to many customers will be unattractive. 30. Is action necessary at the EU level to make practical assistance available from Member State governments or national competent authorities (e.g. through one-stop-shops ) in order to facilitate cross-border sales of financial services, particularly for innovative firms or products? 20

21 Please explain your answer to question 30: As mentioned above, the market will generally deliver products as and when demand arises. 31. What steps would be most helpful to make it easy for businesses to take advantage of the freedom of establishment or the freedom of provision of services for innovative products (such as streamlined cooperation between home and host supervisors)? 32. For which retail financial services products might standardisation or opt-in regimes be most effective in overcoming differences in the legislation of Member States? Life insurance (This work would build on existing EIOPA research on the Pan-European Personal Pension product) Mortgage ne 33. Is further action necessary at the EU level in relation to the location of risk principle in insurance legislation and to clarify rules on general good in the insurance sector? 34. Please provide any additional comments in the box below: 5000 character(s) maximum 21

22 Useful links Details of the Green paper ( Green paper document ( Specific privacy statement ( More on the Transparency register ( Contact 22