General approach reached by the Council on two draft regulations for strengthening economic governance
The Economic and Financial Affairs Council meeting ended with an agreement to further improving economic governance in the euro area. In addition, the Council adopted a regulation harmonising rules for short selling ad credit default swaps and the conclusions providing guidance to the Member States for tackling macroeconomic and fiscal challenges.
Ministers agreed on a general approach on two draft regulations on economic governance during the Economic and Financial Affairs Council meeting held on 21 of February. One of the draft regulations is aimed at enhancing monitoring and assessment of draft budgetary plans of euro area Member States, especially those subject to an excessive deficit procedure; and a second one on enhanced surveillance of euro area Member States that are experiencing severe financial disturbance or request financial assistance. This general approach will enable the presidency on behalf of the Council to start negotiations with the European Parliament, with a view to reaching agreement at first reading as soon as possible.
On the other hand, the Council also adopted a regulation on short selling and certain aspects of credit default swaps with the abstention of the United Kingdom delegation. The regulation introduces common EU transparency requirements and harmonises the powers that regulators may use in exceptional situations where there is a serious threat to financial stability. In November 2011, the European Parliament agreed to curb short selling and trading in credit default swaps.
In addition, the conclusions providing policy guidance to the Member States for tackling macroeconomic and fiscal challenges under this year's European Semester have been adopted by Ministers. The European Semester involves simultaneous monitoring of the Member States' structural reforms and fiscal policies during a six-month period every year. The conclusions provide guidance on short-term priorities under their national reform programmes (structural reforms) and stability or convergence programmes (fiscal policies).