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22nd Jan 2022

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Banking union dominates final EP session This WEEK

  • MEPs will gather in Strasbourg this week for the final Parliament session before May's European elections. (Photo: europarl.europa.eu)

Crucial laws for the EU's banking union will headline proceedings in Strasbourg this week as MEPs gather there for the parliament's final session before May's European elections.

On Tuesday (15 April) deputies will debate and then sign off on the three final pieces of banking legislation: pan-EU rules protecting the first €100,000 of individuals' savings; a directive on bank recovery which sets out the hierarchy of shareholders and bondholders who will suffer losses if private banks get into difficulties; and a law establishing a single resolution mechanism for banks.

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The agreement establishes a single regime to wind-down banks alongside a common fund worth €55 billion paid by the banks themselves to cover the costs of resolution. The rules will apply to all banks in the eurozone, as well as to those in countries which sign up to them.

Chief among the several limited concessions won by MEPs from governments was a more speedy mutualisation of the fund, which will be composed of domestic bank levies being paid into "national compartments". Forty percent of the fund is to be mutualised in the first year, 20 per cent in the second year, the rest equally over a further six years.

Talks between MEPs and ministers on the bank recovery and resolution directive were concluded last autumn, but officials want a single set piece event to sign them into law, which will be followed by a press conference with financial services commissioner Michel Barnier and the Parliament's negotiating team.

With the the European Central Bank set to assume its new responsibilities as the supervisor for the eurozone's banking sector later this year, the basic legal framework promised by EU leaders in July 2012 as part of a concerted effort to break the link between indebted banks and countries, will be in place before the European elections.

Among other files expected to be agreed by deputies are a revision to the bloc's controversial rules on workers posted in other EU countries, rules on access to basic banking services, and plans to cut the bloc's use of plastic bags by 80 percent by 2019.

In Brussels, foreign ministers will meet on Monday and Tuesday (April 13/14) for emergency talks likely to centre on the continuing crisis in Ukraine.

EU countries remain divided about the bloc's response to a crisis which shows signs of escalating beyond Russia's recent annexation of the Crimea.

In recent days, pro-Russian groups in Ukraine's east have occupied public buildings in three cities in the east of the country, a move which officials in Kiev say could be used as a pretext by President Vladimir Putin to send more troops across the border.

For their part, the UK, Poland, and Sweden have proposed sending an EU police mission to Ukraine to build up its law enforcement bodies.

But other EU countries including France, Germany, Italy, and Spain, have voiced concern about taking steps that might antagonise Russia such as economic sanctions.

The talks come before officials representing the EU, United States, Ukraine and Russia meet for further talks on the situation in Geneva.

Agriculture ministers are also in town on Monday for discussions on the bloc's fruit and vegetable sectors.

A quiet week for the European Commission, meanwhile, which is already in pre-election purdah, will see the EU executive publish its monthly infringements package on Wednesday (16 April) against countries that have broken EU law.

New EU Parliament chief elected This WEEK

The lead candidate is the centre-right European People's Party's (EPP) Maltese MEP Roberta Metsola, who has been outspoke against corruption and rule-of-law issues - but some MEPs are concerned over her anti-abortion voting record.

Key talks with Russia over European security This WEEK

The Nato-Russia council will take place in Brussels on Wednesday, as western and Russian officials begin a series of meetings this week in an effort to de-escalate tensions over Ukraine's eastern border - where Russia has amassed troops.

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