Report on the application of Regulation EU No 260/2012 establishing technical and business requirements for credit transfers and direct debits in euro

Background:

Regulation EU No 260/2012 establishing technical and business requirements for credit transfers and direct debits in euro and amending Regulation (EC) No 924/2009, also known as the Single Euro Payments Area (SEPA) Regulation or SEPA end-date Regulation, was adopted in 2012 and has been a major step forward in the proper functioning of the internal market through the creation of an integrated market for electronic payments in euro that makes no distinction between national and cross-border payments.

The Regulation imposed 1 February 2014 as an end-date for migration in the euro area. A month before the initial end-date for migration, the end-date was postponed by 6 months until 1 August 2014 to take into account delays in the migration observed in various Member States. This 6-month delay was sufficient to ensure a smooth transition from legacy credit transfers and direct debits in euro to SEPA credit transfers (SCT) and direct debits (SDD). Member States that do not belong to the euro area had until 31 October 2016 to migrate to SCT and SDD.

On 15 December, the European Commission sent a questionnaire to Member States for reply by 31 January 2017 about a series of issues related to the application of the Regulation, such as the migration from legacy credit transfers and direct debits to SCT and SDD for each and every Member State, the use of options by Member States, the authorities designated for ensuring compliance with the Regulation and their powers, or the issues that may still be encountered across the EU with regards to the implementation of the Regulation.

This report concludes that, overall, the SEPA Regulation is correctly applied across the EU. There is currently no need for a follow-up legislative proposal. The very few and well identified issues (IBAN discrimination and competent authorities competences) that persist have been addressed by Member States and their resolution should be closely monitored. The main issue to be closely observed is the IBAN discrimination by payees (i.e. imposing on payers to pay from an account located in a specific country, which is contrary to article 9 of the Regulation) as the number of cases have decreased but new cases could still appear.

The SEPA project did not end with the completed migration to the SEPA SCT and SDD standards. It is very much alive through initiatives that participate in building the Single Euro Payments Area such as 'SCT inst' - a European project for instant payments in euro that will be launched in November 2017 - or the Mobile Proxy Forum - an initiative aiming at interoperating peer-to-peer mobile payments solutions across the EU, projects supported by the Euro Retail Payments Board, chaired by the European Central Bank and where the European Commission sits as an observer.