On 30th April 2007 the European Commission decided to consult the European Economic and Social Committee, under Article 262 of the Treaty establishing the European Community, on the Green Paper on Retail Financial Services in the Single Market The Section for the Single Market, Production and Consumption, which was responsible for preparing the Committee's work on the subject, adopted its opinion on 3 December 2007. At its 441st plenary session, held on 16th and 17th January 2008 (meeting of 16 January), the European Economic and Social Committee adopted the following opinion by 129 votes to one with one abstention.

The broad principle that informs the Green Paper on Retail Financial Services in the Single Market is improving consumer welfare. Since consumers have many opportunities to avail themselves of financial services in their daily lives, improving the retail financial services sector could play an important role in fulfilling the overarching goal. Also, according to the Commission the retail market has remained extremely segmented, with the result that:

• Activity beyond national borders is on the whole limited.
• There are widely differing prices for services which are, by and large, similar.
• Consumers have a relatively limited choice.
• The profitability of brokers varies markedly from one country to another.

The operational objective of the Green Paper is to reduce the segmentation of the retail financial market and lift legal and economic barriers to client mobility. Having laid the ground work for mobility of supply, the European Union wants to complete the picture by supporting the mobility of demand.

A number of critically important points emerged during a hearing organised by the EESC. The debate highlighted agreement with the Commission's proposed objectives, as well as the practical difficulties encountered in certain areas. The Green Paper sheds no light on how legal and fiscal constraints can be overcome, such as the law on money laundering and terrorist financing. Neither does it address the barriers to full market integration, stressing the fragmentation of the retail market, and almost calling for further procedures to consolidate national and, above all, transnational markets.

The hearing concentrated on:

• Personal lines insurance
• Savings and investment products
• Retail banking

All of which have to be taken into account when thinking of consumer policy strategy. The EESC supports the consumer protection commissioner, Ms Meglena Kuneva, who has set three main objectives regarding the 2007-2013 consumer policy strategy:

1. Empowering consumers.
2. Enhancing the economic and non-economic welfare of Europe's consumers.
3. Protecting consumers effectively.

Conclusions from the EESC:

The European Economic and Social Committee supports the Green Paper's aim of developing the single market for retail financial services, seeking to pinpoint and remove all the artificial barriers whose exploitation prevents European citizens from taking full and direct advantage of the benefits in terms of cost and quality of supply. The Committee believes that the Green Paper provides only a partial review of the financial services and products market, overlooking the issue of distribution, which is a key factor in terms of competition.