Tuesday

24th Jan 2017

EU commissioner steps into BNP Paribas row with US regulators

France’s top EU official on Thursday (12 June) suggested US regulators scale back a massive fine set to cost French bank BNP Paribas billions for its non-compliance with US sanctions.

Michel Barnier, the EU’s internal market commissioner, told reporters in Washington any fine should be “proportionate, fair and objective”.

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  • Barnier steps into row between US and BNP Paribas (Photo: European Parliament)

“Given the importance of this case and the importance of this bank ... we are closely following the situation and we simply wish that this affair be handled in a proportionate, fair and objective manner,” said Barnier.

US authorities accuse BNP Paribas of breaking sanctions against Sudan, Iran and Cuba between 2002 and 2009. The bank is said to have carried out dollar transactions with the three states.

As a consequence, BNP Paribas could lose its authority to clear dollar transactions with a €7.3 billion fine on top.

The figure would be the largest fine against a bank ever imposed by US authorities and could potentially wipe out BNP’s 2013 pre-tax income of about €8.2 billion.

French authorities have already voiced objections over the possible scale of the fine.

They raised the issue with US President Barack Obama on several occasions but without result. The US president says he cannot interfere with the judicial and regulatory process of the US Justice department.

Earlier this month, France's foreign minister Laurent Fabius described the multi-billion euro fine as unreasonable.

He noted the size of the fine, if issued, could endanger an EU-US free trade pact, currently under negotiation.

The EU and US are at loggerheads on whether to include financial services in the free trade agreement.

“We don't agree with the Americans on this point,” said Barnier, reports AFP.

The European Commission, negotiating on the behalf of the bloc of 28 member states, wants financial services integrated into the pact.

Meanwhile, the AFP reports the bank’s chief operating officer Georges Chodron de Courcel on Thursday stepped down in what is described as a surprise move.

BNP said Chodron de Courcel’s departure is not designed to appease the Americans who reportedly wanted him fired along with other top employees.

BNP has also attracted a separate commission investigation over its alleged role in rigging a multi-trillion euro derivatives market at the height of the crisis between 2008 and 2009.

EU should raise own taxes, says report

A group chaired by former Italian PM and EU commissioner Mario Monti says Brexit should be used to create EU-level levies to depend less on member states contributions, and to abolish member states rebates in the EU budget.

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