As the year marking the 25th anniversary of the European Single Market draws closer to an end, we are approaching another anniversary. On January 1, 2019, the European single currency, the Euro, will turn 20. Based on this broader context, let us review the European Commission’s Work Program (ECWP) 2019.
The 10 priorities as identified in European Commission’s Work Program 2019
The 2019 work program concentrates on 10 priority areas identified by the Juncker Commission, which aims to deliver on them before the European Parliamentary Elections in May 2019. These priorities are:
- Boosting jobs creation, growth and investments,
- Establishing a connected digital single market,
- Creating a resilient energy union with a forward-looking climate change policy,
- Working on balanced and progressive trade policies to harness globalization,
- Creating a deeper and fairer Internal Market with a strengthened industrial base,
- Striving towards a deeper and fairer Economic and Monetary Union,
- Creating a balanced and progressive trade policy to harness globalization,
- Safeguarding an area of justice and fundamental rights based on mutual trust,
- Establishing a new migration policy, and
- Working to become a stronger global actor.
The Main Program Points Relevant to the Financial Industry
Here are the key takeaways for the financial industry:
- Boosting jobs creation, growth and investments: The ECWP 2019 points out that Europe’s economy is performing well and that growth reached a 10-year peak in 2017. The Juncker Commission’s investment plan for Europe is expected to create 1.4 million jobs by 2020, thus increasing the European Union’s Gross Domestic Product (GDP) by 1.3% by 2020. The plan has generated 344 billion euro in additional investments surpassing its original target of 315 billion euro by 9%.
- Establishing a connected digital single market: Eighteen of the 30 initiatives the Commission had suggested for the Digital single market are already law. It now wants to swiftly enact legislation surrounding the areas of copyrights, ePrivacy and contract law and focus on the challenges of Artificial Intelligence (AI). This initiative further suggests the establishment of a European Cybersecurity Industrial, Technology and Research Competence Center to secure the digital marketplace.
Creating a deeper and fairer Internal Market with a strengthened industrial base: The Commission wants to remain a standard setter and global reference point in topics pertaining to data protection (think GDPR), Big Data and AI. It also is aiming to quickly consolidate the corporate tax base in Europe and introduce fair taxation earned in the digital economy. The commission wants to accelerate the agreement on:
- The creation of pan-European Personal Pension Products,
- European Market Infrastructure reform,
- Improvement of The European Union’s financial supervisory architecture,
- The proposal on insolvency, restructuring and second chance,
- Other Capital Markets Union proposals on crowdfunding, covered bonds, facilitating cross-border distribution of investments funds, promoting small and medium scale enterprises’ (SME) listings on public markets, and more, proportionate and affective rules for investment firms, and
- The establishment of stronger anti-money laundering supervision to be enforced across the European Union.
The ECWP 2019 further includes various sections dealing with Brexit-preparedness. The ECWP’s policy suggestions will have far-reaching consequences which will not be contained to Europe alone. Wealth managers working with cross-border distribution partners, and who are in the process of digitizing parts of their services, will need to pay close attention as these regulations role out.
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