Together with our members we are creating a Video series of first-hand accounts of the Pandemic’s impact, both personally & professionally.

We invite you to join us today for a first-hand look at the impact of the global shutdown following the Coronavirus (COVID-19) outbreak – Today we are featuring Sophie Lechner, Founder & CEO of Global Commerce Education a Member of the EACCNY.
The questions we asked our members for this series are:1) What are some challenges you, personally and your organization have faced?2) What are some of the most surprising (positive, innovative) responses/changes you have witnessed?3) How will this experience change us going forward, as a society and in terms of how we do business?

EACCNY has its finger on the pulse of how this worldwide pandemic is effecting companies and organizations on both sides of the Atlantic. EACC is where Americans & Europeans connect to do business.

The European Commission has welcomed a list of ‘best practices’ agreed by the financial sector, and consumer and business organisations, to help further mitigate the impact of the coronavirus pandemic. It sets out concretely how different market participants can support citizens and businesses throughout the crisis.
Today’s ‘best practices’ cover several issues, including:
Payment moratoria for consumer and business loans, and for insurance contributions: these measures can help those facing financial difficulties by deferring payments;
Enabling safer cashless payments while ensuring cash payments remain available for those who need them;
Ensuring loans aimed at mitigating the impact of coronavirus are provided swiftly, and that the fees and interest rates incurred are fair;
Legitimate insurance claims are processed and paid out as quickly as possible.
Valdis Dombrovskis, Executive Vice-President for an Economy that Works for People said: “Our goal right now is to make sure that the liquidity taps are kept turned on and that consumers and especially smaller companies can get the financial support they need. I warmly welcome the extensive dialogue that we have had with the European financial sector, and business and consumer representatives. Our fruitful discussions have led to today’s ‘best practices’ list. I invite all those concerned to make full use of this valuable tool. We will take stock of the situation in September and continue the discussion on how to best ensure continuous flows of credit, as part of the recovery.”
Today’s ‘best practices’ list follows two roundtable meetings facilitated by the Commission with consumer and business representatives, European banks, other lenders, and the insurance sector. The discussions are part of a wider effort by the Commission to increase lending to the real economy, including a banking package in April. The Commission will facilitate a further roundtable in September to take stock of progress and will continue the dialogue with stakeholders to support lending during the recovery. All participants are encouraged to follow these best practices.
Today’s text has been agreed by all roundtable participants and includes:
Best practices for bank and non-bank lending to consumers;
Best practices for bank and non-bank lending to businesses;
Best practices for insurers.
Background
The economic shock caused by the coronavirus pandemic is having a far-reaching impact on businesses and consumers. On 28 April 2020, the Commission adopted a banking package to help facilitate bank lending to support the economy. The swift agreement of the package by the European Parliament and Council has meant that the targeted legislative changes included in the package can already be in place for the second quarter of 2020.
As part of this package, the Commission announced a dialogue with the European financial sector, as well as business and consumer representatives. The purpose of this dialogue was to explore how different financial players could support citizens and businesses throughout the pandemic. On 28 May, the Commission organised a first roundtable meeting with stakeholders to discuss relief measures where all represented parties declared their openness to cooperation and dialogue. As a follow up, on 29 June, the Commission organised a second roundtable meeting. Today’s ‘best practices’ list was agreed following this meeting.
Over 25 organisations participated in both roundtables including from:
Consumer organisations
Business federations
Insurance companies
Banks
Access the report here: Best practices agreed by the financial sector and consumer and business organisations to help further mitigate the impact of the Coronavirus pandemic
Compliments of the European Commission.

The European Commission has today recommended that Member States do not grant financial support to companies with links to countries that are on the EU’s list of non-cooperative tax jurisdictions. Restrictions should also apply to companies that have been convicted of serious financial crimes, including, among others, financial fraud, corruption, non-payment of tax and social security obligations. The aim of today’s recommendation is to provide guidance to Member States on how to set conditions to financial support that prevent the misuse of public funds and to strengthen safeguards against tax abuse throughout the EU, in line with EU laws. By coordinating restrictions on financial support, Member States would also prevent mismatches and distortions within the Single Market.
Executive Vice-President Margrethe Vestager, in charge of competition policy, said: “We are in an unprecedented situation where exceptional volumes of State aid are granted to undertakings in the context of the coronavirus outbreak. Especially in this context, it is not acceptable that companies benefitting from public support engage in tax avoidance practices involving tax havens. This would be an abuse of national and EU budgets, at the expense of taxpayers and social security systems. Together with Member States, we want to make sure that this does not happen.”
Paolo Gentiloni, Commissioner for the Economy, said: “Fairness and solidarity lie at the heart of the EU’s recovery efforts. We are all in this crisis together and everyone must pay their fair share of tax so that we can support and not undermine our collective efforts to recover. Those who deliberately bypass tax rules or engage in criminal activity should not benefit from the systems they are trying to circumvent. We must protect our public funds, so that they can truly support honest taxpayers across the EU.” 
It is up to Member States to decide if they wish to grant financial support and to design measures in line with EU rules, including State aid rules, and their policy objectives. The coronavirus outbreak has required unprecedented efforts at both national and EU level to support Member States’ economies and facilitate their recovery. This includes substantial financial support to provide liquidity and capital for companies, save jobs, safeguard supply chains and facilitate research and development. In this context, several Member States have expressed their willingness to adopt rules, restricting access to such support by companies engaged in tax avoiding practices involving tax havens, or convicted of financial crimes, and have requested guidance from the Commission on how best to address this concern.
Today’s recommendation aims at providing a template to Member States, in line with EU laws, on how to prevent public support from being used in tax fraud, evasion, avoidance or money-laundering schemes, or terrorist financing. In particular, companies with links to jurisdictions on the EU’s list of non-cooperative tax jurisdictions (e.g. if a company is resident for tax purposes in such a jurisdiction) should not be granted public support. Should Member States decide to introduce such provisions in their national legislation, the Commission suggests a number of conditions on which they should make the financial support contingent. The EU list of non-cooperative tax jurisdictions is the best basis to apply such restrictions, as it will enable all Member States to act consistently and will avoid individual measures that may violate EU law. The use of this list to implement the restrictions will also create more clarity and certainty for businesses.
At the same time, the Commission stands ready to discuss with Member States their specific plans for ensuring that the granting of State aid, in particular in the form of recapitalisations, should be limited to undertakings paying their fair share of tax.
The Commission also recommends exceptions to these restrictions – to be applied under strict conditions – in order to protect honest taxpayers. Even if it has links to jurisdictions on the EU’s list of non-cooperative tax jurisdictions, a company should still be able to access financial support under certain circumstances. This could be the case, as an example, if it can prove that it has paid adequate tax in the Member State for a given period of time (e.g. the last three years) or if it has a genuine economic presence in the listed country. Member States are advised to introduce appropriate sanctions to discourage applicants from providing false or inaccurate information.
Member States should also agree to reasonable requirements for companies to prove that there is no link with a jurisdiction on the EU list of non-cooperative tax jurisdictions. The recommendation suggests principles to assist Member States in this area.
Finally, Member States should inform the Commission of the measures that they will implement to comply with today’s recommendation, in line with the EU’s good governance principles. The Commission will publish a report on the impact of this recommendation within three years.
Compliments of the European Commission

Statement by President Charles Michel |
One week from today, the 27 Leaders will come together here in Brussels.  It will be our first physical meeting since the beginning of the crisis.
As you know, last May, on the request of the European Council, the Commission presented a package that combines the MFF and the recovery instrument Next Generation EU.
On June 19th, leaders had a first discussion on this proposal. These discussions revealed strong opposition to the package. As a result, I immediately began negotiations and bilateral meetings with all the leaders. And based on these discussions, today I propose my revised proposal for the European multiannual budget and the Recovery Plan.
It is firmly grounded in our EU priorities – climate transformation, digital agenda, European values and a stronger Europe in the world.
The goals of our recovery can be summarised in 3 words: first convergence, second resilience and transformation. Concretely, this means: repairing the damage caused by Covid-19, reforming our economies, remodelling our societies.
Last week, I concluded my bilateral discussions with the 27 EU leaders and I have also met with the European Parliament several times, both formally and informally. From these discussions, I have identified the six building blocks of a possible future agreement.  And we need to find the right balance to reach a final political agreement.
The first building block is the size of the MFF. For the size of the MFF I propose 1,074 billion in order to fulfil the long-term objectives of the Union, and to preserve the full capacity of the Recovery Plan. My current proposal is largely based on my February proposal, which reflected two years of discussions between Member States.
The second building block: the rebates. Rebates, based on my proposal, will be maintained for Denmark, Germany, the Netherlands, Austria and Sweden.  In real terms, on the basis of 2020, in a lump sum.
The third building block is the size of the Recovery package, the recovery fund. The Commission will be empowered to borrow up to 750 billion euros through an Own Resource Decision. These funds may be used for back-to-back loans and for expenditure channelled through MFF programmes. This is an exceptional and one-off tool for an exceptional situation.
The fourth building block, loans and grants. I propose to preserve the balance between loans, guarantees and grants to avoid over-burdening Member States with high levels of debt. This is also key for the future of the Single Market and to prevent more fragmentation and disparities.
The fifth topic: the allocation of Recovery and Resilience Facility (RRF). This proposal establishes a real link between the Recovery Plan and the crisis, and ensures the money goes to the countries and sectors most affected by the crisis: I propose that 70% of the Recovery and Resilience Facility will be committed in 2021 and 2022, according to the Commission’s allocation criteria. 30% will be committed in 2023, taking into account the drop in GDP in 2020 and 2021. The total envelope should be disbursed by 2026.
The sixth building block is the question of governance & conditionality, with three important goals we need to reach. The first one, Reform and Resilience National Plans. On governance, Member States will prepare, based on our proposal, national recovery and resilience plans for 2021-2023 in line with the European Semester, notably Country specific recommendations. The plans will be reviewed in 2022, taking into account the final allocation key and the assessment of these plans will be approved by the Council, with qualified majority vote on a proposal by the Commission.
The second important goal that we need to reach is related to Climate change and for the first time we propose to target 30% of funding on climate-related projects.  That is important for Europe’s young generations and Europe’s future ambitions. Climate transition remains our top priority and our recovery must also focus on the transformation of our economies. Expenses under the MFF and NextGenerationEU will comply with our objective of climate neutrality by 2050, the EU’s 2030 climate targets, and the Paris Agreement.
The third important conditionality that I propose to support is the question of Rule of Law and the European values. We are taking a key step to anchor the rule of law and values in our European project and this is why I propose a strong link between funding and respect for governance and rule of law.
We have many instruments to address this issue: first a new budget conditionality. I maintain the February proposal: in case of deficiencies with respect to Rule of Law, where sound implementation of the EU budget is concerned, the Commission will propose corrective measures to be approved by the Council by qualified majority. We have also the Rule of Law monitoring under preparation by the Commission. In this context, I propose that the Commission and the Court of Auditors report on deficiencies in the rule of law that affect the implementation of the EU budget. We have of course also Article 7 of the Treaty and I propose to increase the funding for Rule of Law and values projects, through additional financing for the European Public Prosecutor’s Office and the Justice, Rights and Values Program, with a special focus on disinformation and to promote media plurality.
Then I come to other essential topics: first on Repayments and Own Resources. Many Member States and the European Parliament expressed concerns over the repayment at the beginning of the next budget cycle. They also criticised the lack of own resources that would finance the reimbursement. In my proposal, repayments would start earlier in 2026, so two years ahead, and this commitment enhances the pressure on us to introduce new own resources.
First I propose to focus on three areas: plastic waste, carbon adjustment mechanism and the digital levy.
There will be a new own resource related to the use of plastic waste starting in 2021. And I invited the Commission to put forward a proposal in the first semester of 2021 on a carbon adjustment measure. And I will propose to introduce a digital levy with the view of introducing it by the end of 2021, based on the Commission proposal. Then I propose to invite the Commission to come back with a revised proposal on ETS. And finally, we will continue to work on the project of a financial transaction mechanism.
You see, there is a very strong ambition to make important progress.
Brexit is challenging for all of us and that is why we propose a Brexit reserve of 5 billion. We would create this reserve in order to counter the unforeseen consequences in the most affected Member States and sectors.
Finally, it is essential to learn the lessons. The health sector is a fundamental sector, that is why for both RescEU and Health we will increase in line with the Commission proposal in order to respond to Covid-19 and the consequences of Covid-19.
Compliments of the European Council.

The European Securities and Markets Authority (ESMA), the EU’s securities markets’ regulator, has published today its second report on sanctions and measures imposed under the Markets in Financial Instruments Directive (MiFID II) by National Competent Authorities (NCAs).

Overall, in 15 (out of 30) EEA Member States, NCAs imposed a total of 371 sanctions and measures in 2019 of an aggregated value of about €1.8 million.
The Report provides an overview of the applicable legal framework and the sanctions and measures imposed by NCAs under the MiFID II framework during the year 2019. Due to differences in the identification of sanctions and measures for the purpose of the reporting to ESMA and the length of the enforcement processes, the data does not provide at this time the basis for detailed statistics, clear trends or tendencies in the imposition of sanctions and measures.
Next Steps
The information included in this Report will contribute to ESMA’s work aimed at fostering supervisory convergence in the application of MiFID II.

Access the full report here: ESMA ISSUES SECOND REPORT ON SANCTIONS UNDER MIFID II
Compliments of the European Securities and Markets Authority (ESMA).

Watch the webcast of the press conference |
The Covid-19 pandemic is turning into a jobs crisis far worse than the 2008 crisis. Women, young people and workers on low incomes are being hit hardest, according to a new OECD report and unemployment statistics released today.
The OECD unemployment rate edged down to 8.4% in May 2020, after an unprecedented increase of 3.0 percentage points in April, to 8.5%, the highest unemployment rate in a decade. In February 2020, it was at 5.2%. The number of unemployed people in the OECD area stood at 54.5 million in May. The lack of variation between April and May is the result of contrasting trends. On the one hand, in the United States, as the economy started to re-open, many furloughed workers went back to work, even as other temporary layoffs became permanent. On the other hand, unemployment is increasing or risks becoming entrenched in many other countries.
The OECD Employment Outlook 2020 says that, even in the more optimistic scenario for the evolution of the pandemic, the OECD-wide unemployment rate may reach 9.4% in the fourth quarter of 2020, exceeding all the peaks since the Great Depression. Average employment in 2020 is projected to be between 4.1% and 5% lower than in 2019. The share of people in work is expected still to be below pre-crisis levels even at the end of 2021.

Initial public support has been unprecedented in scale and scope, notably through the expansion of job-retention schemes that allow employers to cut the hours their employees normally work while receiving financial support for these unworked hours. Total hours worked have plummeted, falling ten times faster in the first three months of the current crisis than they did in the first three months of the 2008 global financial crisis, in OECD countries for which data are available.
Speaking ahead of a special OECD Roundtable Ministerial Meeting on Inclusion and Employment policies for the Recovery – chaired by Spain’s Minister of Inclusion, Social Security and Migrations, Mr. José Luis Escrivá – OECD Secretary-General Angel Gurría said: “Building on the swift and decisive initial response to the Covid-19 crisis, countries now need to do everything they can to avoid this jobs crisis turning into a full-blown social crisis. Macroeconomic policies must remain supportive through the crisis to minimise the risk of a prolonged slump and a lost generation of young people whose labour market prospects are durably harmed. Meanwhile, reconstructing a better and more resilient labour market is an essential investment in the future of the next generations.”
People on low incomes are paying the highest price. During the lockdown, top-earning workers were on average 50% more likely to work from home than low earners. At the same time, low-income workers were twice as likely to have to stop working completely, compared to their higher-income peers.
Women have been hit harder than men, with many working in the most affected sectors and disproportionately holding precarious jobs. The self-employed and people on temporary or part-time contracts have been particularly exposed to job and income losses. Young people leaving school or university will struggle to find work and face the risk of long-term damage to their earnings potential.
The Outlook provides a series of recommendations for where countries should focus their efforts to help people and firms through the crisis and reduce the long-term impact.
In the short term, continued support for some sectors still affected by containment measures remains vital to protect jobs and well-being. But it is important to target support to those most in need, while fostering the incentives to go back to work safely for those who can and supporting firms hiring new workers. This is vital to avoid the scars of prolonged joblessness and inactivity. Businesses, especially small ones, will need support to implement health and safety practices in the workplace.
As prospects of quickly finding new work will remain poor for many, some countries should extend unemployment benefit durations to prevent jobseekers from sliding too quickly into much less generous minimum income benefits. Emergency support for the self-employed should also be re-assessed to improve targeting, restore incentives and ensure fairness.
In the medium term, countries should address the structural gaps in social protection provisions that the crisis laid bare. This will involve strengthening adequate income support for all workers, including the self-employed, part-time and other non-standard workers. Firms must also repay the trust governments have invested in them during the emergency phase of the COVID-19 crisis by keeping their workers to the extent possible and investing in their skills. To ensure no one is left behind in the recovery, extending support for vocational education and training is crucial, as well as leveraging social dialogue and collective bargaining to enhance the resilience of the labour market.
Compliments of the OECD.

10/07/2020 – OECD Secretary-General Angel Gurría announced today to the OECD Council that he will not be seeking an additional mandate to lead the Organisation. He has issued the following statement:
“During the 14 years that I have been leading the OECD, I have strived to make it more visible, more relevant, more impactful, more efficient. All to better serve our Members, first and foremost, as well as our Partner countries.
In the context of the worst pandemic since the ‘Spanish flu’ of 1918 and the worst economic crisis since the Great Depression of the 1930’s, the strategy we defined with Members holds true. Our quest for a new narrative of growth, which puts people at the centre; our efforts to continue building a rules-based international economy and society, most recently on international taxation and Artificial Intelligence; our timely policy advice and support to countries when they are pursuing reforms; our openness to new thinking and our push to have integrated, multidisciplinary views, and to be at the forefront of policy thinking and advice; our interactions at the highest political levels, including with the most influential global fora, and our support to global agendas, like climate or the SDGs; our enlargement process and our close collaboration with partners; our engagement with different stakeholders; all speak of a new, different, better OECD.
The COVID-19 crisis has instilled in us a renewed sense of duty. I will dedicate the year ahead to ensure meaningful contributions from the OECD to this and other multilateral agendas.
As the process for the selection of the next Secretary-General starts, I very much hope that countries will consider candidates that will preserve and further advance the mission, the vision, and the ambition that we, Members and the Secretariat, have built together over the last fourteen years, and which has made the OECD the place to design, develop and deliver better policies for better lives.”
As decided by the OECD Council in 2016, the selection process is launched on 1 August 2020. OECD Member countries will be asked to put forward candidates by the end of October 2020, following which there will be interviews and consultations which will culminate by end of February 2021. The next Secretary-General shall be chosen by the OECD Member countries for a five-year term beginning 1 June 2021.
Find a full biography of OECD Secretary-General Angel Gurría here.
Compliments of the OECD.

This interview of Yvonne Bendinger-Rothschild, the Executive Director of EACCNY, was featured in Transatlantic Business & Investment Council’s (TBIC) market insight on FDI-related developments in Europe for July 2020.
Yvonne joined the European American Chamber of Commerce New York Chapter (EACC) as its Executive Director in October 2010. The EACC’s goal is to stimulate transatlantic trade & business development, and to facilitate exchange and develop relationships between European and American businesses and professional organizations. As part of her role, she focuses on providing EACC’s network access to new and innovative transatlantic business opportunities as well as relevant resources and support on topics affecting business activities between Europe and the United States. Yvonne is also a member of the United Nations Business Sector Steering Committee on Financing for Development, a Fellow of the Disruptor Foundation, and member of the Economic Club of New York. Since 2019, she is a member of the TBIC Advisory Council.
1. Yvonne, you have actively participated in our Panel on Transatlantic Economic Relations and FDI Trends at our 2019 Annual Conference in Richmond. For those members who did not have the pleasure to meet you in person, can you elaborate a little bit on your work for the European American Chamber of Commerce New York?
Yes, the program TBIC put together was excellent, and the people I met were all very relevant to what we do, we have been in touch with many of them.
The slogan of the EACC is “we are the platform where Americans and Europeans connect to do business.” Concretely, we bring together European and American business executives and help them better understand the business environment on the other side of the Atlantic. An international expansion is complex and to succeed one needs reliable partners, the EACC network helps companies build these relationships.
In my role I am in charge of the EACC’s New York chapter, the largest within the network, and I spearhead our growth initiative which includes forming partnerships and developing new chapters.
2. We all currently experience a unique situation for the global economy. How does the European American Chamber of Commerce New York deal with current travel restrictions and the lack of meetings and events for its members?
It’s been a challenge to say the least, moving all operations to home office is much more than handing someone a laptop and sending them home. This requires a rethinking of business processes and procedures: how do we communicate with our members, collect remittances, how do we pay our own bills. It’s the small things that make it complex.
How do we communicate efficiently among the staff and other stakeholders and how do we do that securely and efficiently. We were well prepared internally and across the chapter network communication where we had regular calls already established.
We made a point of calling each of our members individually and asked them how they are doing and how we could help. We brainstormed with them how we can support their activities and assist with challenges they were facing.
We asked ourselves what topics are relevant for our members in this crisis and what is already covered by other organizations or our members themselves and where does EACC as a network have answers that you can’t find anywhere else.
We were lucky as we had many of these protocols in place and even a number of webinars on hand that we were able to deploy at a moment’s notice. Many of them turned out to be more topical than ever, such as discussions about trade & tariffs, cyber security, privacy, and immigration. The EACC network as a group has incredible experts among our members and we were able to quickly deploy their expertise to satisfy the insatiable need for information that this pandemic triggered.
We are developing new ways to connect our members with the other attendees of our programs, we are developing new outlets for our members to showcase their expertise and connect them one-on-one to get through this. It is labor intensive but it’s worth it and our renewal rate is proof that we are doing something right.
I also witnessed a lot of transatlantic collaboration, as we are connecting companies from Europe looking for U.S. partners or who have products fit for the U.S. market and U.S. companies who have unique solutions that are sought after in Europe. We see a lot of collaboration and sharing of best practices across the Atlantic.
3. Some European FDI source countries and industries seem to be better equipped for the new situation than others. Do you see any new trends and opportunities for U.S. economic development organizations as a result of the COVID-19 crisis?

In my view FDI decisions are not based on cheap labor and the best tax breaks a State can offer. The determining factor for a partnership or where a company expands is based on the availability of a qualified workforce and a good standard of living for executives and their families.
COVID-19 revealed that there is a real need for collaboration, and people are actively pursuing it. We have connected so many executives with their counterparts across different industries and everyone is willing to pay it forward.
I am seeing a number of European companies looking to manufacture in the U.S. and in need of partners on the ground to help them produce parts or the whole product in the U.S. and setting up a sales office. This will be a start to more collaboration down the road.
The next 6 month are not going to be easy, but they will be a good time to forge new and intensify existing relationships. The U.S. and Europe are better together, we can only succeed with the right partners. That’s what the EACC network is all about: good relationships take a while to build but they are a good investment.
Compliments of the TBIC.

Main results
Economic impact of COVID-19 and recovery measures
Ministers exchanged views on the progress achieved on the implementation of measures to respond to the COVID-19 crisis at EU level. The European Commission and the European Central Bank (ECB) presented their assessment of the current situation.

We are at a crucial moment in our response to the economic consequences of the COVID-19 crisis. We are stepping up our efforts to make sure that companies, employees and member states can access the funds we agreed on earlier this spring. In parallel, crucial negotiations are also ongoing on the recovery plan. Ministers today reiterated their commitment to swiftly deliver on an effective response for a strong recovery.
Olaf Scholz, Germany’s Federal Minister of Finance and Vice Chancellor

Ministers took stock of the implementation of the three safety nets:
the ESM pandemic crisis support for member states: this instrument, based on an existing ESM precautionary credit line adjusted in light of the COVID-19 crisis, became operational on 15 May 2020.
the temporary support to mitigate unemployment risks in an emergency (SURE): this Commission-managed scheme can provide up to €100 billion of loans under favourable terms to member states and will become operational once all member states have provided their guarantees. This process is expected to be completed by the end of the month.
the EIB pan-European guarantee fund to support businesses: the €25 billion guarantee fund, which will mobilise investments across EU industries, will become operational as soon as member states accounting for at least 60% of EIB capital have provided their guarantees. The fund is expected to be finalised by the end of July.
Ministers also took stock of ongoing work on the EU’s recovery post COVID-19. Pending a decision by the European Council, work on the technical aspects of the recovery plan legislation continues.
COVID-19: the EU’s response to the economic fallout (background information)
Capital markets union
The Chair of the High Level Forum on the capital markets union (CMU), Thomas Wieser, presented the forum’s final report, published on 10 June. This report sets out 17 recommendations aimed at removing the biggest barriers in the EU’s capital markets and increase European capital markets’ competitiveness.
Ministers exchanged views on the priorities to bring the CMU forward, in particular with a view to overcoming the economic consequences of the COVID-19 crisis and to creating solid EU-based alternatives for capital markets after Brexit. This discussion will feed into the preparations of a new Commission CMU action plan, which is expected to be published by the end of the year.

Strengthening the Capital Markets Union will be among the top priorities of our Presidency in the economic field. Capital markets have a crucial role to play in the post-COVID recovery, to provide additional funding sources for our companies and to facilitate the green and digital transformations. Our goal is to agree a common approach in the Council on priorities for further strengthening this initiative by the end of the year.
Olaf Scholz, Germany’s Federal Minister of Finance and Vice Chancellor

High-Level Forum on capital markets union (European Commission)
Convergence reports
Ministers took stock of the convergence reports published by the European Commission and the ECB on 10 June. The reports examine whether non-euro member states satisfy the necessary conditions to adopt the single currency. They cover seven countries: Bulgaria, the Czech Republic, Croatia, Hungary, Poland, Romania and Sweden.
The reports are based on convergence criteria, including price stability, sound public finances, exchange rate stability and convergence in long-term interest rates. The compatibility of national legislation with Economic and Monetary Union rules is also assessed. The reports concluded that none of the countries meet all the formal conditions for joining the Euro area yet.
Convergence report 2020 (European Commission)
Convergence report 2020 (European Central Bank)
Information from the Presidency
The German Presidency outlined its priorities in the area of economic and financial affairs. It will focus on Europe’s comprehensive and ambitious response to the COVID-19 pandemic. It will also work on modernising the EU’s tax policy, strengthening the banking union, advancing the capital markets union, promoting a secure and innovative digitalisation of the financial services sector and combatting money laundering and terrorist financing. Sustainable finance also remains of central importance.
The Presidency also informed ministers about preparations of the upcoming G20 finance meeting and progress on ongoing international issues.
Compliments of the European Council.

The European Commission has today adopted a Communication to help national authorities, businesses and citizens prepare for the inevitable changes that will arise at the end of the transition period. Changes will occur to cross-border exchanges between the EU and the UK as of 1 January 2021– irrespective of whether an agreement on a future partnership has been concluded or not.
Commission President Ursula von der Leyen said: “The British people decided in a democratic election to leave the European Union and its benefits. This means that no matter how hard we now work towards a close partnership agreement, our relationship will inevitably change. My top priority is to ensure that EU citizens and businesses are as well prepared as possible for 1 January 2021”.
The European Commission’s Chief Negotiator, Michel Barnier, said: “Public administrations, businesses, citizens and stakeholders will be affected by the UK’s decision to leave the EU. Following the UK Government’s decision not to extend the transition period, we now know that these changes will take place on 1 January 2021 – deal or no deal. We are helping them to prepare as best as they can.”
Today’s Communication “Getting ready for changes” sets out a sector-by-sector overview of the main areas where there will be changes regardless of the outcome of the ongoing EU-UK negotiations, and sets out measures that national authorities, businesses and citizens should take in order to be ready for these changes. It in no way seeks to prejudge the outcome of negotiations. As such, it does not examine the possible implications of a failure to reach an agreement, nor does it consider the need for contingency measures.
Its aim is to ensure that all public administrations and stakeholders are ready and well prepared for the unavoidable disruptions caused by the UK’s decision to leave the EU and to end the transition period this year. These measures complement actions taken at national level.
In parallel, the European Commission is reviewing and, where necessary, updating all 102 stakeholder notices, published at the time of the withdrawal negotiations – many of which continue to be relevant for the end of the transition period. The list of more than 50 updated notices is in annex to the Communication and all are available on the Commission’s dedicated webpage.
Next steps
The European Commission will work closely with national authorities, businesses and other stakeholders over the coming months to help them prepare for the far-reaching changes that will occur at the end of the year, irrespective of whether an agreement is found.
Background
The United Kingdom left the European Union on 31 January 2020.
The Withdrawal Agreement concluded between the EU and the UK secured an orderly departure of the United Kingdom, providing legal certainty in important areas including citizens’ rights, the financial settlement and the avoidance of a hard border on the island of Ireland.
The Withdrawal Agreement provided for a transition period, which ensures that EU law continues to apply to the UK from 1 February 2020 to 31 December 2020. At the end of the transition period, the UK leaves the Single Market and the Customs Union, thereby putting an end to the free movement of people, goods and services. The United Kingdom will also no longer participate in the EU’s VAT and excise duty area, nor in EU policies and programmes, and will stop benefitting from the EU’s international agreements. Changes will affect both sides and happen irrespective of whether or not an agreement on a future partnership between the EU and the United Kingdom is reached.
The EU and the UK are currently negotiating an agreement on a new future partnership, but even if such an agreement is concluded, the future relationship between the EU and the UK will be very different from what it is currently, including the end of frictionless trade.
There will inevitably be barriers to trade in goods and services and to cross-border mobility and exchanges. Public administrations, businesses, citizens and stakeholders on both sides will be affected and must therefore prepare.
For more information
Communication “Getting ready for changes. Communication on readiness at the end of the transition period between the European Union and the United Kingdom” (9 July 2020)
European Commission webpage: “The EU and the United Kingdom – Getting ready for the end of the transition period”
Compliments of the European Commission.