There are certain common underlying themes in European financial services policy and law. These include investor, depositor and policyholder protection, prudential supervision of the phenomenon known as bancassurance or Allfinanz , common rules on prevention of money-laundering and protection of personal data. The role of the State in the provision of financial services, in particular provision for old age and retirement, is also an increasingly important policy and legislative area. For these reasons harmonisation of the laws and policies relating to this area has been on the European agenda for many years.
This essay will look at the minimum harmonisation policy of the European Union in the areas of banking, insurance and investment services. In doing so I will look at the European Directives relevant to each of these three sectors and discuss the main elements of the harmonisation policy in each area. I will also look at other directives which are perhaps specific not to any one of the areas mentioned above, but to the area of financial services in general.
Before I do so however I will look at the concept of minimum harmonisation and what it means in a European Union context.
Minimum Harmonisation is a relatively recent legislative technique, used by the European Union with Directives being the main means of harmonisation of regulations. The European Economic Community (EEC) (Treaty of Rome) and the European Commission have a general preference for minimum harmonisation as opposed to total, partial, optional, horizontal and mutual recognition. Minimum harmonisation refers to a process whereby only minimum rules essential for the functioning of the internal market are harmonised. This 'minimum harmonisation' can only be successful if the minimum requirements are acceptable to most of the member states. Minimum rules are set at Community level, but member states are...