European Union News - Internal Market

During the meeting held in Barcelona (Spain) in May 3rd, the Governing Council of the European Central Bank (ECB) decided to maintain the interest rates applicable to date. This decision was taken in a scenario in which, although a gradual recovery is expected over 2012, the levels of uncertainty in euro area economy still remain.

A qualified majority of EU delegations are in favour of a provisional compromise text with regard to the proposals to amend the EU's rules on capital requirements for banks and investment firms. Besides revising the existing capital requirement directives, the proposals divide them into two new legislative instruments.

The euro area seasonally-adjusted unemployment rate was 10.9% in March 2012, compared with 10.8% in February. Regarding the whole EU, the unemployment rate was unchanged in March 2012 compared with February. In March 2012, the youth unemployment rate was 22.6% in the EU and 22.1% in the euro area, a slight increase compared with the figures released in February 2012.

The European Commission presented an outline of the principles that should guide EU countries when they organise the participation of the relevant partners in the different stages of the implementation of the EU Common Strategic Framework funds. In addition, it announced the preparation of a European Code of Conduct on partnership.

EU Justice Ministers reached a partial general approach on a directive on criminal sanctions for insider dealing and market manipulation, the so called "market abuse directive". The directive would create an obligation for Member States to ensure that these conducts are punishable as criminal offences. They also agreed that that awareness of the rights of victims needs to be raised.

The results of the ECB survey shows that euro area SMEs’ external financing needs increased between October 2011 and March 2012. At the same time, the survey results show that access to bank loans continued to deteriorate.

According to the latest European Restructuring Monitor (ERM) published by Eurofound, for every three jobs lost in the European Union in large-scale restructurings, two new ones were created during the first quarter of 2012. In addition, the report also reveals a weakening EU economy with an increasing likelihood that the Union is already in a double-dip recession.

The European Commission launched a public consultation on how to cut the costs of setting up new networks for high speed internet in the EU. According to the Commission data, for every 10% increase in the broadband penetration the economy grows by 1 to 1.5%. The European institution also believes it could cut the cost of broadband investments by a quarter.

The Economic and Monetary Affairs Committee approved a resolution which proposes a better design for the financial transaction tax in order to capture more traders and to make evading it unprofitable. The text also says that if it is not possible to establish the tax EU wide at the outset, enhanced cooperation should be envisaged.

The European Commission sent to Belgium, Spain, France, Cyprus, Poland and Portugal a easoned opinion which asks to those countries to notify within the next two months the measures they are taking to update their national legislation in conformity with the latest Directive on e-money. Electronic money is a digital equivalent of cash, stored on an electronic device or remotely at a server.