FINANCIAL SERVICES: FIN-USE PANEL POINTS TO FLAWS IN STOCKTAKING REPORTS.

FIN-USE strongly disagrees with the recommendations made by the four expert panels about how to safeguard user interests. The expert groups suggest that user interests are best protected by competition, reductions in national protectionism and self-regulation as opposed to regulation.

FIN-USE favours consumer home-country control (i.e. the rules of the country where the financial services provider is headquartered). Moreover, it is sceptical about self-regulation and wants more user involvement in the Lamfalussy processes. User problems such as exclusion, predatory lending, over-indebtedness, excessive payment fees and fraud in the security markets also need to be addressed, says FIN-USE.

However, FIN-USE does support the four groups' general recommendation that future EU policy should be based on empirical evidence rather than theoretical presumptions.

The key recommendations of FIN-USE:

- Consumer confidence in the financial services industry is essential for building a successful single market.

- The user perspective should be properly considered at all levels of policy making - including in the Commission, the Lamfalussy committees and national regulators.

- More solid evidence is needed about the problems faced by users in today's markets.

- Product providers tend to focus on the control of intermediary distribution channels, which results in high commissions to intermediaries, high charges to consumers and a lack of transparency.

- The Commission should guard against the danger that increased competition in the single market will lead to cherry-picking of the most attractive customers and financial exclusion of other customers.

- The advantages for users of a self-regulation by the...