Insurance intermediaries and investment management in the EC

Abstract

Creating a single market in financial services within the EU presents particular difficulties due to the fact that the Member States have their own regulatory regimes which differ substantially throughout the Community. Regulation is a necessary element in financial services especially since the protection of the users of such services is necessary. Having different regulatory regimes would undermine the freedoms provided for by the Treaty of Rome, in particular the right of establishment and the freedom to provide services. This is so because national regimes usually inhibit the establishment of branches or subsidiaries and the provision of cross border services. Regulation in financial services is considered an . important asset by most states, and therefore the challenge that arises is to adopt a form of regulation which is not in conflict with the single market. As highlighted by the Commission Action Plan for the Single Market which was endorsed by the European Council in June 1997, both the sector of collective investment undertakings and insurance intermediaries are areas in which the single market is still incomplete. Two Proposals have been brought forward in 1998 with regard to UCITS and the action plan paves the way for a proposal on amending the Insurance Intermediaries Directive by mid-2000.