http://www.ceps.eu/ Latest publications from Centre for European Policy Studies en-us Sat, 05 Jul 2008 13:06:58 +0200 Sat, 05 Jul 2008 13:06:58 +0200 http://blogs.law.harvard.edu/tech/rss admin@ceps.be admin@ceps.be Report of event http://www.ceps.eu/Article.php?article_id=594 Speakers: Eka Tkeshelashvili, Foreign Minister of GeorgiaNicu Popescu, European Council on Foreign RelationsChair: Michael Emerson, Senior Fellow & Head of the Neighbourhood Policy Unit, CEPSDate: 27 May 2008Following the victory of the ruling party in Georgia in parliamentary elections on May 21st, CEPS invited the newly appointed Foreign Minister, Eka Tkeshelashvili, to present the prospects for the political development of her country towards pluralism. Minister Tkeshelashvili underlined the willingness of Tbilisi to improve shortcomings in the functioning of the political system and stressed the attention her government pays to the critical reports about the conduct of the electoral process. Nonetheless, she stated, the overall results are democratically legitimate and a constructive dialogue with the opposition is now needed. Tkeshelashvili also spoke of the current stalemate in the separatist regions of Abkhazia and South-Ossetia, pointing to the deterioration in the conflict in Abkhazia since last March. She also underlined the worry caused by the ongoing Russian military build-up in the region. Quoting UNOMIG data (the United Nations Observer Mission in Georgia), she acknowledged that Georgia is unaware of the kind of military capacity Moscow is building up there, and where their troops are located. This represents a threat to Tbilisi and raises serious doubts about the peace-keeping nature of Russian military presence there. As a prerequisite to the solution of conflicts, the Foreign Minister stated the need to be respected as an independent sovereign country by Russia. The episode last April of a Russian fighter shooting down an unmanned Georgian drone was quoted as an example of this necessity. Secondly, Tkeshelashvili attested to Georgian willingness to provide the separatist regions with the widest autonomy, including a free economic zone. In her opinion, the main obstacle to engaging in a positive (result-oriented) dynamic lies in the format of negotiations. Russia is considered as the main peace-broker on the ground but is in fact a non-neutral actor. The format should then be diversified to include other actors with an equal role. Nicu Popescu, Policy Fellow at the European Council on Foreign Relations, gave an overview of the state of play in EU-Georgia relations. The last five years have been characterised by a new EU engagement, but also by failures that have engendered disappointment in Tbilisi. Against the background of these difficulties, he stressed a key divergence in priorities. On the one hand, Brussels is more entitled to consider long term approaches, favouring technical and economic priorities. On the other hand, Georgia is facing pressing geopolitical priorities. Moreover, EU actions through the ENP or the OSCE are not backed by a sufficient budget and are less attractive than the offers made to countries such as Ukraine or Moldova. Furthermore, the credibility of Georgia as a democratic state has been diminished by the repressions of November 2007. This is problematic for the EU and it can be used by those member states sceptical towards Tbilisi as a brake on further policies. Popescu suggested possible solutions for the improvement of EU-Georgian relations. Notably, he advised Tbilisi to invest in a more diversified dialogue with all 27 member states in order to present its proposals in advance. As an example, he cited the peace plan for Abkhazia, which he considered to be poorly explained to the EU, despite the quality of its proposals. In his concluding remarks, Michael Emerson, CEPS Senior Research Fellow, gave a synopsis of the three axes determining the path towards further developments in Georgia and relations with the EU. Firstly, in the economic sphere, Tbilisi has taken advanced liberalising measures and the European Commission should now propose suitable steps towards a deep free trade agreement. Secondly, as far as democracy is concerned, Georgia needs to make improvements. Thirdly, in the realm of security, he stressed the inadequacy of the recent proposals that President Saakashvili addressed to Suhumi (Abkhazia).   Report of event http://www.ceps.eu/Article.php?article_id=587 On Tuesday 16 April, the European Commission, in cooperation with CEPS, organised a major international conference to assess the impact that globalisation has on the European Social model.Speakers at the event included: Sophie Boissard, Deputy head of cabinet of Christine Lagarde, Minister for the Economy, Finance and Employment of France, former Director General of the Centre dAnalyse Stratégique Marek Belka, Executive Secretary of the United Nations Economic, Commission for Europe, former Prime Minister of Poland Vladimir Spidla, European Commissioner for Employment, Social Affairs and Equal Opportunities Marjeta Cotman, Minister of Labour, Family and Social Affairs of Slovenia Hans-Gert Pöttering, MEP, President of the European ParliamentClick here to access a video recording of the event. Report of event http://www.ceps.eu/Article.php?article_id=586 Speaker: George Soros, Chairman, Soros Investment Fund Inc.Moderator: Daniel Gros, Director, CEPSDate: 17 April 2008Before an audience of CEPS members and guests at the Club de Warande in Brussels, George Soros, the famously successful speculator, investor, author, philanthropist and political activist, presented his latest book, The New Paradigm for Financial Markets: The Credit Crash of 2008 and What It Means, containing his views on the current financial crisis, its causes and solutions. Soros speechAccording to Soros, the crisis emerged with the bursting of the US housing bubble and has its origins in the dominance of the current paradigm of efficient markets, or so-called market fundamentalism or ideology. In his view, this assumption is incorrect from a philosophy of science standpoint. Market fundamentalism assumes that markets function efficiently, move to the equilibrium, and therefore work in everyones best interest. However, contrary to the views of his mentor Karl Popper, Soros argues against the unity of science and considers economics a social science that cannot rely on natural science assumptions. Natural phenomena operate according to the law of cause and effect and humans use their cognitive abilities to understand. Yet, humans do not only observe but play a participative-manipulative role in social science phenomena. In terms of the market, the concept of equilibrium is a natural science theory that does not apply to economics. Specifically, Soros focuses on the concept of reflexivity, where individuals with their perception shape reality and create disequilibrium rather than equilibrium when they enter into market transactions. This leads to uncertainty. The evidence shows that contrary to the statistical assumption of normal distribution, reflexivity leads to thick tails. In practical terms, the crisis started in the 1970s, when the oil crisis led to imbalances between oil importers and producers, which had to be covered by the banks. This resulted in a bank crisis in the early 1980s under Reagan and Thatcher, when banks were given greater freedom to cope, relying on the market to take care of it. According to Soros, the credit expansion trend towards a bubble was reinforced by the misperception of a self-correcting market, which in turn reinforced the bubble. Usually, when there are signs that a possible bubble if forming, there is a testing/twilight period. If this test is passed, the misperception prevails and the bubble grows. If this test is not passed, policy is adapted and there is no bubble. For the current crisis, the test would have had to be failed and the authorities would have been obliged to regulate the financial market. However, on the contrary, the test was passed and the housing bubble burst in August 2007, exposing all the accumulated weaknesses based on market fundamentalism. One of those weaknesses is that instead of financial regulation, moral hazard was created, whereby the institutions causing the financial risk were not the ones to fully bear it. The current financial crisis, which is characterised by a situation of uncertainty, liquidity shortages and solvency problems (where counter-parties cannot deliver), offers a strong argument in favour of a paradigm shift away from market fundamentalism towards more financial market regulation. In Soros opinion, an international financial regulation agreement, for example a Basel III Accord, would be suitable. He proposes to regulate every aspect of financial market, encompassing capital, derivatives and currency markets. Soros suggests that the authorities have not understood the necessity of a paradigm shift and thereby deny any responsibility for this current crisis. Instead of regulating the financial market, for example, he expects the Fed to react in conventional ways: increase the money supply by lowering interest rates to counter the effects of the crisis until even this strategy fails. The United States might face a recession and inflation, which might have a global impact due to the globalisation of international financial markets. He observed that the ECB had limited its actions to keeping the interest rate at 2%. There will definitely be global effects but they will affect different sectors in different parts of the world to a different degree. The prediction is that everything will be fine, it is just a question of time. Concerning the dollar as a strong or weak currency, Soros thinks that the euro will not replace the dollar as a global reserve currency and that the dollar will eventually recuperate. For the moment, there is a general flight from cash towards real assets until the dollar becomes the reserve currency again.A Hungarian journalist proposed to Soros that he should fund the creation of modern think-tanks to research his theories and propose regulation. Soros replied that research can be like finance: the higher the risk, the higher the possible return. In other words, the more risky the theory defended, the higher the return when the theory turns out to render the best predictions. Report of event http://www.ceps.eu/Article.php?article_id=585 Keynote speech: Geert-Jan Koopman, Director for Industrial Policy and Economic Reforms, DG Enterprise and Industry, European CommissionPanelists: Jorgo Chatzimarkakis, MEP and Member of the Committee on Industry, Research and Energy, European Parliament; Peter Cartwright, Chairman, Centre Européen des Silicones;Camille Bonenfant-Jeanneney, Adviser for Industrial Affairs, Permanent Representation of France to the EUChair: Staffan Jerneck, Director, Director for Corporate Relations, CEPS Date: Tuesday 8 April 2008The meeting opened with an intervention by Gert-Jan Koopman, Director for Industrial Policy and Economic Reforms, in DG Enterprise, who challenged some of the most commonly held assumptions about the trade-off between sustainable growth and reinforced international competitiveness. In his view, rendering Europes economic structure more environmentally friendly would also bring considerable economic gains in the medium-long term. In order to achieve this, however, the EUs growth strategy would have to meet certain conditions. First of all, there is the need to adopt a win-win perspective: according to Koopmans analysis, it is possible to reduce the European CO2 emissions by up to 10%, without entailing any additional economic cost. Secondly, it is necessary to implement long term policy frameworks which, given the high degree of uncertainty in global markets at moment, should also be devised with the assistance of innovative economic instruments for the estimation of costs. Moreover, these policies should be aimed at setting correct standards and better regulation practices that could drive forward incentives for innovation. Finally, at a sectoral level, he called for an in-depth analysis of the different types of impact, and for structural reforms on the labour market side. Jorgo Chatzimarkakis, Member of the European Parliament, commented on Koopmans speech, suggesting that an excessive focus on the sustainable dimension of growth risks is leading to losses of competitiveness on an international level. In particular, he drew on the example of European regulations: when they are too rigid, they are less likely to be adopted by the EUs main competitors, especially emerging countries such as China or India. Therefore, the EU should rather implement standard systems within multinational organisations, such as the Green Box measures at WTO level. Moreover, he argued the EU should reinforce its stable position, especially in light of the current US economic stagnation, and avoid formulating standards on a purely ethical basis. European policies should therefore be aimed at achieving a deeper level of integration between the environmental approach and the Lisbon Agenda perspective. The event continued with remarks by Peter Cartwright, Chairman of the Centre Européen des Silicones, who underlined the need for a balance between environmental constraints and economic wealth. In this vein, he highlighted that efficacious innovation policies could at the same time stimulate environmentally friendly structural changes, and guarantee competitive performances. The round of interventions was concluded by Camille Bonenfant-Jeanneney, Adviser for Industrial Affairs at the Permanent Representation of France to the EU, who stressed how energy and climate change issues account for two of the four main priorities of the forthcoming French Presidency. She then highlighted how the creation of a new super-ministry for Minister of Ecology and Sustainable Development and Planning, hierarchically second only to the Prime Minister, signalled the high degree of importance attached by the French Presidency to environmental issues. Madame Bonenfant-Jeanneney made reference to the Emissions Trading Scheme, but explained that it was probably too early to disclose details about this.Click here to download the slides of Mr. Koopmans presentation. Report of event http://www.ceps.eu/Article.php?article_id=584 Speaking at the Opening Dinner of the CEPS Annual Conference 2008, European Commission President José Manuel Durão Barroso started by congratulating CEPS on its 25th anniversary as "one of the most respected think tanks in Europe" and one that has contributed for so many years to the development of the European ideas and the interest in Europe working independently from the EU Institutions to promote the knowledge about what the EU is doing. During his speech, he touched upon many of the issues that have been high on the EU agenda in recent years. First of all, he insisted on his plan for a Europe of results, here, Barroso believes that "The legitimacy of every transnational political project depends on the results that it is able to deliver for the benefit of its citizens". Then on enlargement he underlined how, fifty years ago and up to fifteen years ago, the peaceful reunification of Europe had been seen as a historical challenge. Today, that goal has been achieved, and almost all of Europe is united in prosperity and democracy. In this respect, enlargement was one of the most important moments in the history or Europe (not just of the EU). Concerning the specific challenges for the 21st century, they are in the view of the President global ones: from climate change and energy security, to terrorism, to the increased (economic) competition from several parts of the world. All of them need global answers, and it is quite obvious that these cannot be given without a European response. In particular, with regard to competitiveness, it is necessary to stay the course of European reform. The increased competition should be seen as an opportunity to improve the European economies, in particular, through the opening up of societies and economies. Since the EU is by far the most important export power, it would be completely self-defeating for it to adopt a protectionist attitude. However, Barroso also stressed that economic reforms and increased competitiveness have to go hand in hand with social solidarity and social inclusion. Indeed, the concerns that many EU citizens have towards globalisation were "legitimate", but is was necessary to placate these fears, and to that end the renewed Lisbon strategy stresses more than ever the importance of education and skills, in order to equip citizens better to take advantage of globalisation (rather than defending themselves from it). Another major challenge is the fight against climate change. Here, Barroso passionately affirmed that Europe intends to take the lead, in order to reach a global agreement which will accelerate the transition to a low-carbon economy. Climate change, like energy security and energy supply, are areas where one can better discern the added-value of the EU, since it is clear that even the bigger member states alone would not have the necessary weight to push for a global agreement. The European Commission President also admitted that the green revolution had economic costs, but these had been indicated by the Commission in a fairly transparent way, and there was a consensus that the costs of inaction would be much higher. Moreover, the fight against climate change and the common energy market offer opportunities for economic growth and for more employment. Barroso then addressed the issue of institutional reform, but not before stressing once again that that debate should not be separated from the real substantive policy issues. Citizens can better understand the need for efficient institutions if they agree with policies and goals. That is one of the reasons why there is a need to create and to strengthen institutions and mechanisms enabling citizens to be more closely associated with the politics of the Union. Barroso argued that the Treaty of Lisbon was part of the answer to these problems. In particular, he noted that the treaty gives more co-legislative powers to the European Parliament, the only institution that is directly elected by the citizens of the EU. This is an example of a reinforcing at the same time the competences and the democratic nature of the Union. In this respect, the Treaty also recognised that national parliaments have a special role in ensuring the proper application of subsidiarity. It is the first time that a European Treaty involves the national parliaments so closely in the legislative process, thus creating the conditions for a more accountable, more democratic, and more legitimate Union. So the Treaty of Lisbon sends a powerful message, defining a more active Union, a more democratic, transparent and accountable one. Moreover, it puts in place the conditions for the efficient functioning of the enlarged EU. Here, the European Commission President referred to the CEPS Special Report on the impact of enlargement on the legislative output of his institution, which, in his view, confirmed the empirical evidence showing that the enlarged Commission is working more efficiently, taking more decisions, and with more consensus than the pre-enlargement one. In order to continue with this virtuous trend, Barroso argued, the EU needs stronger institutions, as the only means of providing a common sense of purpose for a Union of 27 member states and more. Furthermore, because of the multiple sources of legitimacy of the EU (supranational, intergovernmental and direct - through the European elections), the principles of institutional interdependence and institutional complementarity are fundamental for the overall legitimacy of the Union. In other words, no institution should replace another one, while they will all benefit from mutual cooperation.   This had to be kept in mind when implementing the new institutional balance, in order to ensure that the process of institutional adjustment becomes a win-win situation, and not a zero-sum game. Thus, all three institutions should be stronger: the EU needs "a stronger European Parliament, not a weaker one, a stronger Commission, not a weaker one, a stronger European Council, more effective, with a more stable representation vis-à-vis the other world powers, not a weaker one, a stronger High Representative that enjoys the legitimacy of the member states and of the supranational/community method, not a weaker one". Finally, for the system to work another fundamental ingredient was necessary. Namely, the political will to act, which according to Barroso, is even more important than the capacity to act. Indeed, with that political will Europe can make progress not only for the sake of Europe, but also for the sake of the world, to which it can propose, and not impose, its values of Peace, Freedom and solidarity. Download the full report of the Annual Conference 2008 in PDF-format Report of event http://www.ceps.eu/Article.php?article_id=579 Type of Event: CEPS Membership Meeting Date & Venue: 15 January 2007, CEPS Speakers: Daniel Gros, Director, CEPS Sandra Polaski, Senior Associate and Director, Trade, Equity and Development Programme, Carnegie Endowment for International Peace Ambassador C. Boyden Gray, Special Envoy of the US for European Union Affairs H.E. Dipak Chatterjee, Ambassador of India to the European Union Chair: Daniel Gros, Director, CEPS Co-Hosting Institution: Carnegie Europe Rapporteur: Chiara Faini The event was opened by an intervention by Sandra Polaski, Carnegie Senior Associate and Programme Director, providing an overview of the findings of Carnegies recent publication entitled "Indias Trade Policy Choices". In light of the Indian economys increasing engagement with the global economy, this study examined the potential consequences of India entering into a Free Trade Agreement (FTA) with the EU, United States and China, respectively, and of its possible adhesion to the Doha Round of the WTO. The report is based on an econometric model that showed that, of all the trade pacts simulated, it is an agreement on the Doha Round that would have the largest impact on the Indian economy. However, while the positive effects on the Indian economy of a multilateral agreement within the framework of the WTO would be modest, such an agreement would also lead to a substantial reduction of tariffs on agricultural products, thus making it crucial to ascertain the potential effects in case of shocks to the world price for rice and wheat. Global price decreases (which are likely to happen, given the short- and medium-term instability of prices of agricultural products) would indeed cause negative effects on the overall Indian economy. They would not only offset any gain drawn from the agreement, but also increase Indian poverty and employment rates in both the agricultural and urban contexts, exacerbating the inequalities within the population. The study therefore supports the concerns of the Indian government over the possible negative implications for poverty and the distributional effects that could arise from a Doha agreement. Of the other simulations of potential FTAs, the one between India and the EU - Indias largest trading partner - estimated negative effects on the Indian side (though modest gains on the European one), while bilateral trade pacts with the US and China would only have slightly positive effects for the Indian economy as a whole, and contextually implied losses in the standards of living of households. In her concluding remarks, Polaski emphasised how, in negotiating further liberalising steps, India has to take into consideration several aspects, balancing market opportunities and distributional costs. In a country that nowadays accounts for the worlds largest share of poverty, this balancing act has to be carried out not only in the interest of India, but in the interest of global stability. The presentation by the Carnegie expert was then followed by the intervention of CEPS Director Daniel Gros, who presented the main points of his forthcoming CEPS publication: China and India: Implications for the EU Economy. This study provides an evaluation of the Chinese and Indian economic performances vis-à-vis that of the EU, in order to define the possible challenges that are likely to arise in the near future. First of all, the results demonstrate that the Chinese economy is evolving much faster than Indias, thanks in particular to great improvements in terms of both human and physical capital. With regard to human capital, however, China still lags behind the EU and the US in terms of the levels of tertiary education attained (and consequently, technical skills). Moreover, the Chinese export structure is already very similar to those of the EU and the US (i.e. it is the typical structure of an already developed country, rather than a developing one). Nevertheless, according to this study, the dramatic growth of China, even if will condition the future of the global economic environment, would not imply any losses for the EU. The event was then concluded by brief comments by Ambassadors Dipak Chatterjee of India and C. Boyden Gray, Special Envoy of the US for European Union Affairs. Ambassador Chatterjee emphasised the efforts undertaken by his government to achieve a higher degree of trade liberalisation, but also the need to exercise care in defending the interests of urban and above all poor agricultural households. Ambassador Boyden Gray called for a greater liberalisation of the Indian economy, and expressed some concerns over the environmental consequences of Chinas growth. Report of event http://www.ceps.eu/Article.php?article_id=575 Speakers: Andrea Renda, CEPS Senior Research FellowJørgen Mortensen, CEPS Senior Research FellowStephen Holgate, University of SouthamptonChair: Liz Lynne, MEP Date: 20 November 2007 EPS Senior Research Fellows Jørgen Mortensen and Andrea Renda outlined the findings of their CEPS report entitled Asthma in the EU: Towards better management and regulation of a public health issue, in the European Parliament on 20 November. The event was hosted by MEP Liz Lynne, who referred to the alarming statistics concerning asthma and its dramatic increase in developed countries. Highlighting the main findings of the report, Jørgen Mortensen pointed to the considerable indirect social and economic costs resulting from the reduced productivity of affected workers. Andrea Renda emphasised the urgent need to involve all stakeholders in a coordinated effort. Renda noted that, due to the particularities of the division of competencies between the EU and its member states, the handling of public health issues is not optimised, concurring with Stephen Holgate, University of Southampton, that many problems are caused by the poor management of asthma patients. Please also see the French website Boursonews that covered the launch of the CEPS report on Asthma in the EU.   Report of event http://www.ceps.eu/Article.php?article_id=574 Speakers: Alexander Alvaro, MEP and Member of the Committee on Civil Liberties Peter Hustinx, the European Data Protection SupervisorPeter Fleischer, Global Privacy Counsel at GoogleChair: Andrea Renda, CEPS Senior Research Fellow On 10 October 2007, CEPS co-organised a seminar with Google on Online Privacy: Reconsidering Policy Options for the Digital Age. The panel of speakers was formed by Peter Hustinx, the European Data Protection Supervisor, Alexander Alvaro, MEP and Member of the Committee on Civil Liberties and Peter Fleischer, Global Privacy Counsel at Google. The event was chaired by Andrea Renda, CEPS Senior Research Fellow.   Report of event http://www.ceps.eu/Article.php?article_id=573 Speakers: David Wright, Director, DG Market, European CommissionCarlo Comporti, Deputy Secretary General, Committee of European Securities RegulatorsAnso Thiré, Head of Public Affairs and Strategy, Euroclear Jorge Yzaguirre Scharfhausen, BME Jean-Baptiste de Franssu, CEO, Invesco Continental EuropeKarel Lannoo, CEO, CEPS and Secretary General, ECMIChair: Carmine Di Noia, Deputy Director-General, Assonime, Member of the European Securities Markets Expert Group Date: 24 October 2007 The landscape of Europes securities market is due to change for ever this week with the entry into force on Thursday, November 1, of the MiFID Directive. This cornerstone of the Financial Services Action Plan of the European Commission aims to iron out the existing differences between national regulatory regimes, harmonize investor protection rules across Europe, enhance greater competition and increase the transparency of securities transactions. Even more ambitiously, MiFID is meant to inject some dynamism into the EU financial services industry, allowing firms to trade across borders with a single EU passport. Competition will be boosted with investment banks allowed to muscle onto territory previously dominated by traditional securities exchanges such as the LSE, Paris-based Euronext and Frankfurt-based Deutsche Börse. Investor confidence is to be strengthened with new consumer protection requirements aimed at ensuring clients get the best possible deal. However, all these changes will not and cannot occur overnight: the MiFIDs entry into force will not bring about the big bang previously predicted by experts. Such are the levels of disarray among firms and supervisors; it seems that the regulation will properly come into being only after a long and tortuous process of legal trial and error. On 24 October CEPS - in cooperation with the European Capital Markets Institute - organized a half day seminar, chaired by Carmine Di Noia (Deputy Director-General, Assonime and Member of the European Securities Markets Expert Group), to promote an open discussion on the future of investing in a Europe "post-MiFID". The event has brought together representatives from European institutions and advisory bodies (notably David Wright, Director, DG Market, European Commission and Carlo Comporti newly appointed Secretary General of the Committee of European Securities Regulators), private-sector financial institutions (Anso Thiré, Head of Public Affairs and Strategy at Euroclear, Jorge Yzaguirre Scharfhausen from BME and Jean-Baptiste de Franssu, CEO of Invesco Continental Europe) to share their views on the MiFIDs implications. From the outset, it was made clear that the new regime will affect several market participants (not only investment banks, stock brokers and broker-dealers, but also asset managers, stock exchanges, corporate finance firms, many futures and options firms and some commodity firms) representing for all of them either a business opportunity or a threat. The main concern of the industry, as stemming from the debate, is mainly related to a sort of "patchy" implementation across Europe. Notably, only three Member States - UK, Romania and Ireland - out of 27 met the January 31, 2007 deadline to transpose MiFID into national legislation; others have since passed the required laws but some, including Italy, Poland, Spain, Hungary, Finland, the Netherlands and the Czech Republic, have not. Hence, delays in adopting the MiFID Directive have left many firms ill-prepared for what is being touted as a new era for financial markets.[1] This patchy implementation is thus a source of major concerns for the financial services industry, which has had to absorb the costs of adapting to burdensome new rules.[2] Strikingly enough, though, the entire compliance effort still being made by the industry to play the game according to the new rules (aiming at the establishment of a level playing-field) is now facing further differences in Member States interpretation of the rules that could create unbearable legal chaos. As a response to this status quo, David Wright and Carlo Comporti outlined respectively the European Commission and CESRs post-MiFID agenda. The first speaker - recently described in an interesting column of the Financial Times as "a believer in more open financial markets, who had the often unenviable task of devising compromises that would please member states across a wide spectrum from supporters of a free-market liberal MiFID to those who saw it as an opportunity to introduce restrictive investor-protection rules and thinly disguised protectionist measures"[3]- agreed with the industrys concerns, declaring that countries who fail to transpose the legislation in time will definitely harm firms. Hence, the EU has already started legal proceedings against Member States that would not be ready in time (while still wishing that the cases could be resolved before reaching the European Court of Justice).[4] Moreover, to strengthen the impact of MiFID as a "ground-breaking piece of legislation", the Commission will: (i) engage itself in two major reviews on commodities and extension of the MiFIDs transparency requirements to non-equities markets; (ii) further investigate the interface between the MiFID and UCITS regulatory regimes; (iii) focus on the post-trading, with specific regard to the issue of clearing and settlement; (iv) assess the role to be played by Credit Rating Agencies (taking into account a possible extension of the MiFID conflict of interest package) and, last but not least, (v) strengthen the transatlantic dialogue with the US on securities regulation. Almost on the same line of reasoning was the CESRs response to the above-described status quo. The Committee of European Securities Regulators, in fact, published on 22 October measures aimed at clearing up last-minute concerns and ensuring smoother implementation of the MiFID Directive. One of the main issues covered was the supervision of cross-border firms, a task that will be jointly undertaken by home regulators and by host regulators based in countries with branch operations. CESR advocated collaboration between supervisors, with structures for requesting regulatory assistance where necessary. CESR also welcomed progress in MiFID implementation, while issuing practical arrangements to ease transition for firms. This statement is contained within the revised version of the CESR recommendations on the passport under MIFID published originally in May 2007. The guiding principle of the statement is to provide business continuity and minimize the potential disruption to business that might be caused by late transposition of MiFID. Indeed, CESR itself addressed concerns about uneven implementation among Member States, announcing that firms from countries which have not yet transposed the Directive will be allowed to continue using passports granted under MiFIDs predecessor, the 1993 ISD. Moreover, on the occasion of the seminar organized by CEPS and ECMI, Carlo Comporti confirmed CESRs strong commitment to provide necessary guidance to Member States and to the industry. It was thus acknowledged that there is still a lot of detail to work out and implementation will require a lot of continued efforts, nevertheless CESR and the Commissions representatives adopted an optimistic approach, focusing more on the achievements made so far in the right direction. To offer corroboration of the scope and extent of its mandate, CESRs future Secretary General made reference to the MiFID work-programme for 2007/2008. CESR will continue during 2008 to undertake its function to provide technical advice to the European Commission and will assist with a number of Commissions reviews (including for example further work in relation to commodities, tied-agents and recording of phone conversations). Work will continue in respect to the common implementation of MiFID Level 2 Regulation, and CESR also plans to create a MiFID Q&A facility to address the practical questions that will arise as we move from the transposition phase to the implementation phase for MiFID, similar to the Q&A facility CESR implemented on Prospectuses. Finally, CESR will continue to work together with CEBS and CEIOPS over the course of 2007 and 2008, and is requested by the Third Energy Package adopted by the European Commission to develop a closer working relationship with the future Agency for the Cooperation of Energy Regulators. Hence, looking ahead, Carlo Comporti gave the audience an update on the work to implement the various databases necessary for MIFID to function. This includes for example, its work to develop a transaction reporting mechanism (to be operational on November 2), a database of liquid shares to facilitate market transparency and a database of systemic internalizers. Comporti also announced that CESR will work on developing a guide for retail investors to explain the new legislative framework and to raise their awareness of MiFIDs new rules and protections. Click here for the powerpoint presentations made at the event. Report by Alessandra Chirico [1] For information on Transposition please refer to the Commissions MiFID Transposition State of Play in the Internal Markets Commission Website. [2] It has been estimated by the UK Financial Services Authority that MiFIDs implementation will entail one-off costs of £900m to £1.2bn for firms, ongoing costs of £100m a year but benefits of up to £200m a year. [3] Peter Norman, Five figures central to shaping directive, Financial Times, October 28 2007. [4] Already at the end of June 2007, the European Commission formally requested a total of 24 Member States - all except the United Kingdom, Ireland and Romania - to write into national law the Markets in Financial Instruments Directive ("MiFID") and its implementing Directive. These requests took the form of reasoned opinions, the second stage of the infringement procedure under Article 226 of the EC Treaty. Report of event http://www.ceps.eu/Article.php?article_id=570 Event: India in the 21th century: Perspectives (Roundtable)Date: 20 September 2007Speakers: K. Kasturirangan, Member of Indias ParliamentDinesh Trivedi, Member of Indias ParliamentTariq Anwar, Member of Indias ParliamentLakshman Singh, Member of Indias ParliamentPrenet Kaur, Member of Indias Parliament Chair: Michael Emerson, CEPS Senior Fellow, Head of the Neighbourhood Policy UnitIndian Parlamentarians seek cooperation with EU On 20 September 2007, a delegation of Indian parliamentarians visited CEPS to participate in a roundtable discussion on "India in the 21th century: Perspectives". The need for a stronger collaboration between the European Union and India was emphasised in several areas. In the field of education, for example, efforts should e made to obtain literacy for all social levels in India. Also, better health services and the efficient use of sustainable energies must be achieved. For reaching these goals, a close collaboration with the European Union is vital. The delegates expressed their wish to co-operate with the EU and the whole world to fight the two main problems facing India: poverty and terrorism. In his opening remarks, Dinesh Trivedi said that the Indian economy is opening up and becoming integrated. Concerning the need for a new approach on energy resources, the Indian parliament members clearly underlined their wish to collaborate closer with the European Union to increasingly use renewable energy sources in India. According to the Indian discussants, India sets a good example for its neighbouring countries on how democracy can function. The question was asked whether the EU model be taken over by India and its neighbouring countries. But before that could happen, a precondition is that all neighbouring countries of India would become democracies. One of Indias dreams is to develop a common market with free movement of goods and persons with its neighbouring countries. When the talk turned to the issue of combatting terrorism, the Indian guests stated that, for them, terrorism has nothing to do with religion. Muslims in India are fully integrated into the Indian population and according to the Indian delegates every one of them is fighting terrorism as much as any non-Muslim. Different religions have co-existed in India for many generations. Dinesh Trivedi raised the question of how to reinforce the exchange of researchers and specialists between India and the EU? Michael Emerson mentioned two possibilities to achieve this goal: 1) an increase of academic exchanges, and 2) stronger links between think tanks in the EU and in India. The Indian delegates concluded with the remark that India and the EU have a lot to give to each other. The EU could support India in terms of establishing new technologies for sustainable energy use and an improved health service system. The Indians can offer highly qualified graduates in the field of technology.Rapporteur: Katharina Müller