Commission Communication for on-line financial services

The approach outlined in a Commission Communication is based on the principle that the trading rules applied to the cross-border sale and purchase of financial services should be those of the Member State where the service provider is established (i.e. the country of origin).

The Commission says this should ensure a level playing field between on-line and more traditional modes of distance trade. The strategy is supported by a series of measures designed to enhance consumer confidence and protection, including further harmonisation of national consumer and investor protection rules, the establishment of out-of-court redress, measures to build trust in internet payments and enhanced co-operation between public authorities responsible for the supervision of cross-border trade in financial services.

The Communication also provides clarification of the impact on financial services of the E-commerce Directive which has to be implemented by Member States by 17th January 2002, in addition to its interaction with other financial services legislation.

Obstacles to both cross-border supply and demand mean that currently there is no significant cross-border trade in retail financial services. The development of e-commerce, together with the introduction of the euro, transforms the business environment and brings an integrated European market in retail financial services within the Union's grasp. The objective of the Commission's Communication is to establish a policy framework that enables consumers and retail investors to access financial services available from throughout the European Union while being fully protected.