Resource centre

Key points

• In the current EU AML/CFT legislation, Member States are allowed to exempt obliged entities from carrying out certain customer due diligence (CDD) measures with respect to e-money products with a proven low risk (Article 12 AMLD).
• To be able to make use of the exemption, various requirements must be met. These include a low threshold of 150 Euro for offline transactions and 50 Euro in the case of remote/online transactions In addition, issuers are obliged to conduct sufficient monitoring of the transactions or business relationship to detect unusual or suspicious transactions.
• This exemption is no longer included in the latest EU Commission’s AML/CFT proposal, without any justification and without actually contributing to the fight against ML/FT.
• The important exemption, which is to the great benefit of customers, is currently being applied to offer numerous prepaid products, like e money gift cards and vouchers. It  plays a very important role in order to maintain the attractiveness of these products and to provide customers with easy access to digital means of payment. These products are now at risk of disappearing from the market. This would also entail negative consequences for issuers, their customers, merchants and businesses distributing such products, as well as for the digital economy as a whole.
• The signatories of this position paper firmly advise and call on the co legislators to retain the exemption for low risk, low value e money products in the AML Regulation for the benefit of customers, proportionate data collection, financial inclusion and to support digitisation and innovative business models.

The European Commission today launched its detailed REPowerEU Plan, following up the outline ideas it presented in March. EuroCommerce Director General Christel Delberghe welcomed the Commission ideas, but stressed the need for support for the retail and wholesale ecosystem to address current challenges and in driving the move away from imported fossil fuels. The proposals for earmarking funding under the Recovery and Resilience Facility and the EU budget are of particular importance in this.

“The Russian invasion of Ukraine has made what were already high, and rising, energy prices now a major challenge to the EU economy and the well-being of its citizens. Our sector is a significant user of energy –in operating its logistics, heating, lighting and refrigeration without interruption. But operating at very low margins, it needs help in investing in the technologies that can bring about change. Obligations to invest without matching support will lead to costs our sector cannot absorb and thus would have to pass on to consumers, creating new inflationary pressures on the customers we serve every day.”

We very much support the proposal to amend the Recovery and Resilience Facility (RRF) guidelines to provide funding for investment in alternative energy sources and energy efficiency and ask that our sector is able to access support. Retail and Wholesale is a very significant user of energy for its own operations and needs to do so 24/7. It already works hard to reduce its carbon footprint and save energy while operating at very low net margins of typically 1-3%. We regret that very few member states have taken up the possibilities under the latest temporary state aid framework, nor have allocated significant funds under their national RRF plans.

Combined with the proposed new rules on planning and permitting, proposals for financing investment in alternative energy, and the Solar Rooftops Initiative could offer opportunities for our sector to contribute to reducing fossil fuel consumption significantly. But any obligation to invest must be accompanied by help in finding private and public funding to install such infrastructure and in accessing other alternative energy sources.

Key points

▪ EuroCommerce supports the aim of the European Commission to encourage further access and use of data in order to mutually benefit public and private actors. Voluntary contract terms, with the involvement of industry actors are welcomed especially for SMEs which often lack the resources.

▪ Businesses need clear rules and legal certainty especially in an area such as data, therefore we would welcome clarifications on the scope and many definitions (data, product, related services) covered by the proposal.

▪ Government access to private sector data needs to be subject to EU-level rules and safeguards to avoid regulatory fragmentation and needs to strictly define the data and the purpose of such access. Repeating an effort of establishing a mechanism that resembles to the proposal for a Single Market Information Tool (SMIT) which lapsed during the last parliamentary mandate should be avoided.

▪ The Commission should propose stronger and concrete safeguards for trade secrets to create a framework for companies to feel safe in sharing more data which is also in compliance with competition rules.

▪ Some provisions will undermine companies’ contractual freedom and discourage data use and sharing, have the opposite effect to that intended. Contractual data-sharing agreements should remain voluntary and respect competition rules.

▪ The measure should provide incentives for companies to share data and avoid creating mandatory obligations that risk discouraging investment in high-value datasets or risks undermining the use of such high-value datasets by ancillary service providers/consultancies.

▪ Businesses need clarity on the use of data generated by connected devices, including how to access and share it.

▪ In most cases datasets collected by connected devices can be mixed (personal and non-personal data) and it is important that any data sharing would remain in line with GDPR and privacy laws.

▪ The current proposal risks overriding the provisions of the GDPR governing international data transfers, creating serious obstacles for the normal data requirements of many EU businesses.

RE: Transition to a Circular Economy and protection of the Single Market
Dear President von der Leyen,
Dear Executive Vice-President Timmermans,
Dear Executive Vice-President Dombrovskis,
Dear Commissioner Breton,
Dear Commissioner Sinkevičius,

The 1st of January 2023 will mark the 30th anniversary of the establishment of the European Single Market. One of the EU’s greatest achievements, the Internal Market is the key driver of EU economic integration. This has been essential to the growth of the European economy and remains crucial to Europe’s global competitiveness. It has brought about greater economies of scale while improving the allocation of resources and enabling the EU to set high harmonised safety standards for consumers and environmental protection.

Today, Europe faces new challenges and has new priorities. Chief amongst these is the European Green Deal and the need for a transition towards a circular and climate neutral economy. The packaging industry, the consumer goods industry and downstream operators understand this imperative and are fully committed to resource-efficient circularity goals. However, fragmentation of the Single Market due to countries taking divergent measures is undermining this commitment and hampering EU industry’s aspiration to lead the transformation towards a more sustainable economy. In light of this, the undersigned associations call on the EU to create one single circular economy not 27 separate ones, underpinned by an integrated Single Market.

Almost everything we consume is packaged. Packaging is an integral part of a product supply chain, and measures that relate to packaging affect most goods traded within the EU. Preserving the integrity of the Single Market is key to ensuring that packaging materials and packaged goods can move freely around the EU, thus avoiding negative impacts on consumers, companies, the environment and on the resilience of essential systems, such as the food and pharmaceutical sectors. Despite this, Member States are increasingly introducing unilateral and often divergent requirements. These are no doubt well-intentioned efforts to improve design, manufacture and labelling of goods to improve their potential for repair, re-use or recycling. Yet, many of these requirements pre-empt forthcoming legislative developments at EU level, compromising the effectiveness of an EU-wide approach.

The increasing number of national measures on the labelling of packaged goods for later sorting is a case in point. These are often implemented at short notice, are contradictory and are not always notified as Single Market rules require. We rely on the Commission to ensure that these divergent rules and their non-notification do not go undetected.

Concretely, disparate national packaging requirements impede the use of a single packaging execution and therefore require the redesign of all packaging across the entire Internal Market destined for an individual country. This has the adverse consequence of diverting investments away from other activities to advance sustainability, such as R&D on eco-design and digital traceability of product information for more efficient recycling.

Redesigning all packaging destined to an individual national market also entails costs for manufacturing. This translates in additional production costs for industry and adverse effects on consumer prices. The loss of economies of scale and the interruption of established distribution models reduce competition within European industry, which is obliged to operate within fragmented national markets. Furthermore, at each step of the value chain, forecasts have to be revised against real
consumption. These disruptions may lead to the destruction of certain products that cannot be placed on shelves. Resources are thus wasted all along the supply chain from raw material suppliers all the way to consumers. This applies to shops, distribution centers, bulk factories, packaging components in the factory and packaging accessories at suppliers.

National labelling requirements can also lead to a disruption of efficient distribution systems, requiring suppliers to ship their unsold goods over longer distances when this proves necessary to relabel them according to divergent national legislations. Additional transport increases fossil fuel consumption, with negative impacts on climate and air quality.

Finally, the multiplication of labelling instructions weakens consumers’ ability to sort packaging waste properly, reducing opportunities for recycling.

The undersigned signatories believe that a fragmented Single Market will severely impact the transition to circularity and weaken the resilience of the European economy. We call on the Commission to take robust and rapid action to tackle national packaging legislation infringing Single Market principles and Article 18 of the Packaging and Packaging Waste Directive. Cooperation rather than unilateral and uncoordinated national action surely represents the best way forward.

Yours sincerely,
The undersigned organisations

We, a coalition of trade associations from both sides of the Atlantic, representing businesses of all sizes and active in a variety of sectors, strongly support efforts to strengthen the transatlantic partnership.
We are experiencing a defining moment in international relations, with the changing geopolitical and geoeconomic landscape likely to create significant long-term ramifications for both the EU and the US.
In light of the Russian invasion of Ukraine, it is clear that the transatlantic partnership remains the strongest, most trustworthy and durable partnership in the world. It is irreplaceable, and it has deployed a robust and credible reaction to recent events. The US and EU have jointly committed to Europe's energy security and sustainability and to accelerating the global transition to clean energy. And the transatlantic tech sector and public authorities have responded quickly and effectively to disinformation and cybersecurity threats.
Today, it is clearer than ever that a resilient and strong transatlantic relationship is necessary to face the challenges to democracy and the rules-based international trading system.
The transatlantic economic partnership is growing in the face of these headwinds, with 2021 being a record-breaking year on many fronts, including trade in goods and services, US foreign direct investment (FDI) flows to Europe and vice versa.1
At the same time, mounting geopolitical tensions show that the EU and US should maintain and deepen the transatlantic bond at all levels and in all areas, so that our values, worldview and economic leadership, are maintained and solidified. In particular, the transatlantic alliance must stand against increased external security and information threats, while ensuring that our regulatory frameworks are fit for purpose.
Going forward, it is paramount that the US and EU continue to work together on a common agenda based on shared values and interests, which need to be upheld forcefully, with courage and strategic vision.
The EU-US Trade and Technology Council
In our view, the Trade and Technology Council (TTC) is a vital opportunity for the US and EU to jointly secure their future trade, economic, and technological leadership, and act as a counterbalance to geopolitical challenges that risk undermining the transatlantic relationship.
It is very encouraging that the EU and US leadership recognize the strategic relevance and economic benefits of closer regulatory cooperation. While preserving their respective regulatory autonomy, and in
1 The Transatlantic Economy 2022, Daniel S. Hamilton and Joseph P. Quinlan (link)
2
light of increasing threats of global fragmentation, both US and EU policymakers should seek to ensure that regulatory frameworks reflect the transatlantic values of openness and non-discriminatory rules; promote greater transatlantic trade and investment; encourage and reward innovation and entrepreneurship; protect security, privacy, and intellectual property; and benefit and protect consumers.
In essence, the TTC’s fundamental role should be to develop common approaches to shared challenges, such as collaborating on research as well as new standards for emerging technologies; maintaining an open and interoperable internet; enhancing bilateral trade and investment, also revitalizing rules-based trade through modernization of WTO rules; tackling global challenges, including climate change and cybersecurity; ensuring robust regulatory dialogue around new digital policy approaches; bolstering transatlantic competitiveness, including investing in next generation digital infrastructure; and strengthening supply chain resilience and semiconductor ecosystems. The TTC should serve to address and resolve differences that may undermine a common approach. The recent agreement on a new Trans-Atlantic Data Privacy Framework is a very welcome development in that regard.
Clearly, the TTC is only one of several international fora supporting EU-US cooperation. Progress in the TTC should complement collaboration in other existing bilateral and multilateral regulatory dialogues and fora, such as the WTO, G20, and OECD.
Importantly, the TTC work should be based on the key transatlantic values of non-discrimination, mutual consultation and dialogue, solid standards on due process and IP protection, and the open, rules-based market. Its modus operandi and outcomes should reflect this.
Stakeholders’ role and tangible outcomes
The transatlantic business community offers its full support to the TTC’s work. The TTC’s priorities and process must be informed by dialogue with stakeholders, and it is encouraging to see that both the EU with its Futurium platform, and US policymakers with their public consultation opportunities, have built a structure to facilitate stakeholders’ engagement.
Stakeholders’ expectations of the next TTC meeting in May 2022 are high. While the focus on “low hanging fruit” is acceptable as a first step, decision-makers should not lose sight of the bigger picture and strategic objectives. This is an incredibly important geopolitical moment for the EU and US to work together and pursue a common bilateral and global vision on technology, trade and security.
We encourage US and EU officials to seek outcomes across all TTC policy areas that would bolster our ability to outcompete non-market economies that do not share transatlantic core values.
We strongly believe that the TTC has the potential to strengthen transatlantic global leadership and deliver tangible results that ultimately benefit companies, workers and citizens. Today is not “business as usual” – the TTC vision and outcomes should reflect this.
*****
Coalition of Services Industries ● Consumer Technology Association ● DigitalEurope
Eurochambres ● EuroCommerce ● European Round Table for Industry ● European Services Forum
Information Technology Industry Council ● National Foreign Trade Council
Software & Information Industry Association ● Trans-Atlantic Business Council

The European Commission has today adopted new rules on the assessment of vertical agreements in distribution which will come into force from 1 June 2022. These rules provide a safe harbour from anti-trust rules for agreements between suppliers and their customers, for example, for the sale, purchase or resale of products.

Christel Delberghe, Director General of EuroCommerce, which represents the retail and wholesale sector in Europe, commented:

“The European Commission has taken an important step by adapting the vertical block exemption rules to a digital environment. We welcome the Commission’s efforts to change the framework, but we are concerned that for SMEs the complexity will mean they remain reluctant to explore or pursue online sales. We, therefore, remain cautious about the degree to which the new rules leave room for interpretation and how they will be used in practice in a market where brands hold a very strong position.”

The retail and wholesale sector is going through a significant digital, sustainability and skills transformation. COVID accelerated the move to online sales and consumers who bought online during the pandemic are expected to continue doing so. Businesses need to be able to offer consumers such online sales, alongside or independently from their brick-and-mortar shops, and to do so as easily as possible. Clear rules on retailers’ and wholesalers’ ability to sell on online marketplaces are vital for small businesses to reach consumers, including those in other member states. EuroCommerce remains concerned about fair competition. It is unlikely SMEs will challenge brands that hold a strong position, where the effect of restrictions such as selective distribution, do not enable them to make effective use of the internet.

Mrs Delberghe added: “Effective competition provides choice for consumers. We ask the Commission and national competition authorities to remain vigilant and to act consistently, to address abuse of the rules to the detriment of the Single Market and of EU consumers.”

Retailers and wholesalers welcome the fact that the guidelines make it more explicit that territorial supply constraints, which are used by large manufacturers to restrict parallel imports, fragment the Single Market. The Single Market is key for the recovery of the retail and wholesale sector from the challenges of the pandemic, says EuroCommerce. But it needs strong and consistent enforcement across the Union to create the right competitive environment that can help retailers and wholesalers offer choice and reasonable prices to consumers struggling with rising costs of living.

European Commission links: Block Exemption – Guidelines

The European Parliament has adopted today its report on competition policy. The report highlights the key role competition policy plays in a properly functioning Single Market, which is of particular importance to European consumers and the economy in view of the damage from the COVID pandemic, the current inflationary crisis and the Russian invasion of Ukraine.

Christel Delberghe Director General of EuroCommerce, which represents the retail and wholesale sector in Europe, commented:

”I am pleased to see the Parliament call for a stop to practices fragmenting the Single Market, such as territorial supply constraints and abuse of selective distribution systems. Tackling them and other abuses that can potentially lead to higher prices and less choice for consumers is particularly important at a time when consumers are struggling with a spiralling cost of living. Practices that restrict the freedom of retailers to source products in the single market such as territorial supply constraints, come at a cost estimated by the European Commission, to consumers of €14bn each year.”

The retail and wholesale sector operates in a highly competitive environment and at low margins to provide an essential service to consumers. It needs the Single Market and competition policy to provide customers with what they need at a reasonable price.

Mrs Delberghe added: “We also welcome the support for temporary state aid flexibility that would give businesses much-needed help in weathering rising energy and commodity costs and supporting investments in the digital, sustainability and skills transition of our sector”.

Europe’s global competitiveness can only be built on strong competition at home. Bolstering competition in the Single Market can also help offset the current high inflation. EuroCommerce is pleased to see the European Parliament come out clearly against conduct which fragments the Single Market. The association has already asked the Commission and national competition authorities to enforce the forthcoming rules on vertical relationships (VBER) to prevent unintended negative effects from the abuse, or the cumulative effect, of vertical restrictions such as selective distribution systems and dual pricing.

The competition policy report also asks the European Commission to look at retail alliances. The 2020 Joint Research Centre study ‘Retail alliances in the agricultural and food supply chain’ clearly identified the many pro-competitive effects of alliances and the need to base the assessment of any anticompetitive effect on the circumstances of each case. In March, the Commission draft Horizontal Guidelines acknowledged that different types of buying alliances across many business sectors could bring benefits to consumers through their negotiations with major manufacturers of the most sought-after products they purchase regularly. This reflects in EuroCommerce’s view the reality of the market in challenging times.

EuroCommerce Director General Christel Delberghe today welcomed the launch of a public consultation on the EU framework for sustainable food systems. She commented:

“The retail and wholesale sector is fully committed to working with other stakeholders in the supply chain to build sustainable food systems in Europe. We have taken a proactive role in the Farm-to-Fork Code of Conduct and our dedicated website shows the many initiatives by our members to encourage healthy and sustainable food choices. Our main ask of the Commission is to ensure that any regulation emerging from this exercise allows flexibility for innovative ideas with well-defined sustainability criteria.”

Retail and wholesale have responded to consumer demand for more sustainable and healthy food options. EuroCommerce’s latest report with McKinsey on the grocery retail market shows continued consumer interest in buying more of these products. But it also highlights a growing polarisation of the ability to buy sustainable and healthy foods between better-off and less affluent households, widened further by present inflationary pressures on the cost of living. EuroCommerce will therefore be asking the Commission to:
•    Propose rules which work with the grain of existing multiple voluntary sector initiatives and add value to these.
•    Ensure a strong single market and an enabling policy environment which supports companies in their ability to do business and differentiate themselves from their competitors, as a basic condition for an innovative market.
•    Be coherent with existing EU legislation and approaches such as in the General Food Law, in defining responsibility and reporting requirements and ensure that responsibility falls on the operators best placed to fulfil those obligations.
•    To keep food safety and a science-based approach at the heart of the sustainable food system and ensure that rules and definitions covering sustainability and any claims related to it are clear and easily applicable by operators, as well as understood by consumers. Any rules on sustainability labelling should be applied voluntarily.
•    Involve retail and wholesale and the rest of the supply chain when drawing up rules to ensure that they are practicable and can therefore achieve their objectives.

Our four organisations – representing Europe’s farmers, food processors, retailers, wholesalers and traders – express our joint solidarity with the people of Ukraine, including the millions that have fled their country to seek safety elsewhere.

Beyond this humanitarian crisis, the war has unleashed massive challenges in the food supply chain with spiralling input and energy costs, and a scarcity of certain commodities needed to maintain a fully functioning supply chain.

In the face of these challenges, we are committed to working together to maintain reliable food supplies to consumers in Europe and beyond.

We are calling on the EU and national governments to help us in several ways.

The undersigned associations welcome the recent EU-US announcement of a new Trans-Atlantic Data Privacy Framework to strengthen data protection, support responsible data transfers, and enable continued transatlantic commerce. We urge the swift finalisation of a Framework that, as stated by European Commission President Ursula von der Leyen, “enables predictable and trustworthy data flows between the EU and US, safeguarding privacy and civil liberties.”

Implementation of a new Trans-Atlantic Data Privacy Framework is critical to a constructive transatlantic relationship. As set out in the Annex to this letter, ongoing uncertainty relating to data transfers has significant economic repercussions for EU enterprises, exports, jobs, innovation, and SMEs, and undermines the ability to promote high data protection standards.

EU enterprises in all sectors and of all sizes rely on their ability to transfer data responsibly around the world, even more so today as many have moved their businesses online amid the COVID-19 pandemic. Companies transfer personal data to send business emails, process payroll and global workforce data, work with suppliers, and serve customers around the world.

However, the central beneficiaries of a new Framework will be EU and US citizens, who will benefit from strengthened personal data protections as new participant companies adopt the privacy controls required by the program, and as new governmental commitments on access to data are implemented.

We again congratulate and urge the European Union and the United States to swiftly bring the new Trans-Atlantic Data Privacy Framework into force.