European Commission has adjusted its Work Programme for 2020
Insights on the adjusted European Commission Work Programme 2020, plans for a sustainable and digital transport recovery, the Digital Services Act and the Capital markets Union and the latest Leaseurope activities.
EU UPDATES & INDUSTRY TRENDS
ADJUSTED EUROPEAN COMMISSION WORK PROGRAMME 2020
Together with the EU Recovery Package, on 27 May the European Commission also published an adjusted Work Programme for 2020. While their work on the 2030 Climate Target Plan, decarbonising energy and smart mobility all remain on schedule, many others are delayed. This includes relevant files like the European Climate Pact, Renewed Sustainable Finance Strategy, Action Plan on the Capital Markets Union, and the Review of the Capital Requirements legislation, which have all been delayed towards the end of the year. The Review of the Non-Financial Reporting Directive and follow-up to the White Paper on Artificial Intelligence are delayed until Q1 2021 while Empowering the Consumer for the Green Transition is delayed until Q2 2021.
You can access the full list here.
EU TRANSPORT MINISTERS DISCUSS SUSTAINABLE AND DIGITAL RECOVERY
EU transport ministers recently met to discuss a sustainable and digital recovery of the transport sector after the COVID-19 outbreak. They welcomed the tourism and transport package presented by the European Commission in May, which includes useful guidelines for the transport sector, and stressed the need for harmonised health protocols to ensure cross-border services. Member states agreed that the hard-hit transport sector will need financial support and a large number of ministers considered that public investment in this regard should come with an industry commitment to cleaner and more sustainable mobility. Finally, ministers called for a coordinated and balanced recovery strategy for transport to be made concrete in the coming weeks. You can find a summary of the meeting here. This was the last Transport Council under the Croatian Presidency, and the incoming German Presidency took the opportunity to present its transport work programme in for the second half of 2020. A draft copy circulated to the press shows a special focus on hydrogen, with Germany aiming to press ahead in the creation of the necessary markets and infrastructures for this.
CONSULTATION ON DIGITAL SERVICES ACT
The European Commission recently launched a public consultation on the Digital Services Act, which they are aiming to release at the end of the year. The consultation, open until 8 September, covers the fundamentals of the e-commerce directive, in particular the freedom to provide digital services across the EU single market, as well as the issue of a level playing field in European digital markets, where currently a few large online platforms act as gatekeepers.
On this topic, the European Parliament has recently expressed its view in a study on e-commerce and the future Digital Services Act. It stresses that the new regulation should concentrate on a few key horizontal rules that apply to the internal structures and operations of platforms and also that a public law framework should be favoured to preserve European values and standards.
FINAL REPORT ON CAPITAL MARKETS UNION
The High-Level Forum (HLF) on Capital Markets Union (CMU) has published its final report on the EU's Capital Markets Union. It sets out a series of clear recommendations aimed at moving the EU's capital markets forward. Completing the CMU has now become particularly urgent in order to speed up the EU's recovery from the coronavirus pandemic. A fully-fledged CMU would help rebuild the EU's economy, by providing new funding sources for businesses and investment opportunities for Europeans. It will be vital for mobilising much-needed long-term investments in new technologies and infrastructure, to tackle climate change and to deliver Europe's New Green Deal and Digital Agenda.
LEASEUROPE LETTER TO ECB PRESIDENT AND DG FISMA ON ACCESS TO FINANCE
Leaseurope addressed a letter to the European Central Bank (ECB) President Ms. Christine Lagarde and DG FISMA Director General Mr. John Berrigan on leasing companies' access to finance. The letter includes Leaseurope’s main requests to mitigate the impact of the CODIV-19 crisis on securitisation markets in Europe and to recognise the low risk profile of Simple, Transparent, and Standardised (STS) securitisations from a regulatory perspective, which will improve the leasing industry’s access to and pricing of securitisation financing.
The letter also includes proposals to facilitate leasing companies' access to the ECB targeted longer-term refinancing operations (TLTROs), and the new pandemic emergency longer-term refinancing operations (PELTROs), which are programmes to obtain ECB funding at low price rates.
LEASEUROPE ATTENDS EVENT ON THE GREEN DEAL & THE RECOVERY PLAN
Leaseurope recently attended an event on “The Green Deal & The Recovery Plan: A New Economic Model for Europe?” with representatives from the European Commission, European Parliament and the Finnish Ministry of Transport. Policy makers confirmed that the recovery needs to be green and sustainable and that green investments will be crucial. In this context, public funding will help first movers but thereafter Member States will need to continue on this path. A European Parliament representative pointed out that lockdown measures reduced emissions by 10 percent and that the EU needs to start thinking about a different kind of economy. A call for SME support was made and the funding increase for the Just Transition Fund was highly welcomed. In the recovery phase, employees will need to be retrained and reskilled (to shift towards a green economy). Research & innovation for green technologies will be key and increased clean infrastructure is needed to support transport and the power grid. Finally, digitalisation and connectivity were mentioned to reduce inefficiencies (e.g. car sensitive traffic lights).
NEW COVID-19 ADAPTATIONS TO IFRS16
The International Accounting Standards Board has implemented changes to the lease accounting standard, IFRS 16. The new rules, which are not yet approved for use in Europe by the European Commission, allow firms to avoid having to change the value of their Right of Use assets (including the value of their former operating leases) to reflect lower agreed lease payments due to Covid-19. The European Commission’s Accounting Regulatory Committee is due to vote on these changes on 22 June, with the endorsement process completed later in the year. You can find out more here. Leaseurope discussed the changes with the European Financial Reporting Advisory Group (EFRAG), the body that advises the Commission on the endorsement of changes to international accounting standards. We told EFRAG that although any simplifications are always welcome in principle, the changes proposed appear more relevant to property leases compared to equipment or vehicles. We suggested the IASB should provide higher value exemptions from IFRS 16 rules for equipment and vehicle assets on a more permanent basis.
AFCAR EXPANDS WORK ON IN-VEHICLE DATA
The AFCAR Alliance, which Leaseurope is a Member of, is creating two new working groups, a technical group and a political group, to better coordinate the industry work on in-vehicle data. The technical group will serve as a forum to discuss different issues, from telematics to cybersecurity, standardization and developments at UNECE level. The political group will validate and endorse the work of the technical group while also providing guidance to the technical group where necessary. The technical group had its first kick-off meeting this month and Leaseurope will keep members informed regarding new workflows within our own working groups.
DEBATE ON RESTARTING TRAVEL AND TOURISM
As a Member of the European Tourism Manifesto alliance, Leaseurope followed a Euronews debate on "Rethinking and Reviving Travel and Tourism" with the support of the European Travel Commission. During the debate it was stressed that lifting border restrictions to restart travel and tourism should happen in a coordinated and transparent way on the basis of agreed health protocols, while discouraging discrimination on nationality. Incentivising tourists to travel again will require the rebuilding of trust, with Portugal given as an example where more than half of hotels are implementing additional voluntary safety measures to reassure travellers. Regarding trends, many Europeans will likely plan a “staycation” this year and remain in their own country and business travel is expected to be reduced. The European Commission has recently launched the web platform Re-Open EU which will provide real-time information on borders and available means of transport and tourism services in Member States. Re-open EU will also include practical information provided by Member States (e.g. opening of hotels, requirements such as wearing a mask) in order to help travel restart in a more conscious way. You can follow the livestream of the debate here.
FINANCIAL SERVICES CONFERENCE 2020
From 25-26 June 2020, the 18th annual European Financial Services Conference 2020 “Embracing change in time of uncertainty” will be taking place. Topics to be discussed include risks and opportunities in the global economy, sustainable finance and green recovery, Capital Markets Union and digital recovery. Speakers include European Commissioner Dombrovskis and representatives from DG FISMA, the European Parliament, Accenture, Barclays, Bloomberg and Kreab. This year’s event will be taking place virtually and is free to attend by registering here.
HOW GLOBAL CAR LEASING CAN CONTINUE TO FLOURISH IN THE NEW NORMAL
On 19 June 2020, the Global Fleet Conference is hosting a high-level CEO panel discussion on how global car leasing will be different in the New Normal, including opportunities for suppliers and their customers. Panel speakers include Tim Albertsen (ALD), Bart Beckers (Arval), Tex Gunning (LeasePlan) and Reggie Cabal (Orix Australia & New Zealand). You can find more information and register here.
FINANCE WATCH DIALOGUE: TOWARDS A SOCIAL TAXONOMY
On 19 June 2020, Finance Watch will be hosting a dialogue on including social and human rights elements into the debate on sustainable finance taxonomy. Südwind Institute will be presenting their research on the topic, to be followed by a discussion with various speakers including the European Commission. You can register for the event here.
On 9 June the Legal Affairs Committee met via conference call.