EBF comments on the EBA draft GL on
EBF advisor: Blazej Blasikiewicz
Publication date: 21 March 2016
The European Banking Federation (EBF) would like to thank the European Banking Authority (EBA) for the opportunity to respond to this consultation paper.
According to the Consumer International report entitled “Risky business: The case for reform of sales incentives schemes in banks”, different authorities have identified some problems related to consumer protection, and by extension an operative risk.
We note that the draft Guidelines have been issued by the EBA on its own initiative in order to give effect to several pieces of legislation. However, to some extent it is difficult to understand the rationale for the draft Guidelines, as similar consumer protection provisions are already incorporated in various EU rules. In particular, the current draft Guidelines seem in some parts to duplicate the ESMA Guidelines on Remuneration policies and practices under MiFID. There is, however, a much broader scope of application with regards to covered institutions and products under the draft EBA Guidelines as well as more detailed requirements regarding documentation, approval and monitoring. Therefore, we consider that if the scope remains this broad the Guidelines should be issued by a jointEBA/ESMA/EIOPA committee and not just the EBA. Moreover having in mind that there are a lot of business models where the same person, as sales staff, offers diverse types of products (i.e. insurance, current accounts, UCITs, etc.) we consider reasonable that remuneration policies and practices should not be regulated in different ways in various Guidelines issued by different European Supervisory Authorities (ESMA, EIOPA and EBA). Maximum convergence is needed on this subject.