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DMD - Evaluation by the



                                                                                                                                   European Commission









                                                                                                                                   In April 2019, the Commission launched its consultation on the evaluation   Background
          In its press release, EBA stresses that it will ensure a: “proportionate imple-                                          of the Directive on distance marketing of consumer financial services.
          mentation of this new framework to take account of the different classes of
          investments firms”. ESMA will also be actively involved in the development                                               As announced in its roadmap, on this issue, the evaluation will gather evi-  The Distance Marketing of Financial
          of the level 2 measures.                                                                                                 dence regarding the functioning of the DMD in its totality and, in particular,   Services Directive (Directive 2002/65/
                                                                                                                                   regarding the following aspects:
                                                                                                                                                                                                     EC, DMD) aims at ensuring the free

          Finally, to assess the impact of the provisions proposed in the regulatory                                               •   scope of services covered                                     movement of financial services in
          deliverables, the EBA also launched a data collection exercise on a volun-                                               •   information disclosure                                        the single market by harmonising
          tary basis.                                                                                                              •   right of withdrawal                                           consumer protection rules governing
                                                                                                                                   •   unsolicited services and communications
                                                                                                                                   •   regulatory choices by Member States                           this area. The Directive sets out a list of
          Next steps                                                                                                               •   interplay with product-specific legislation in the field of retail financial   information concerning the financial
                                                                                                                                       services, the e-commerce framework and horizontal consumer protec-  service and its provider that the
          The Agreement between the Commission, Parliament and Council still has                                                       tion rules.
          to be published in the Official Journal of the EU.                                                                                                                                         consumer should receive before the
                                                                                                                                   The results of the consultation will help the Commission assess the Direc-  distance contract is concluded. It also
          The Regulation will enter into force after publication in the Official Jour-                                             tive’s coherence, effectiveness, efficiency, relevance and EU added value.     grants, for certain financial services,
          nal and will apply from 18 months after its entry into force. Regarding the                                              The consultation consisted of two short questionnaires. One was aimed   a right of withdrawal of 14 days to the
          Directive, Member States shall  adopt  and  publish  the  laws, regulations                                              at the general public, the other to stakeholders such as BIPAR (with ques-
          and administrative provisions necessary to comply with this Directive 18                                                 tions on relevance, effectiveness, efficiency, coherence with other EU texts   consumer. Finally, the Directive bans
          months after its entry into force and it will apply as of the same date as the                                           including the IDD, etc.)                                          services and communications from
          Regulation.                                                                                                                                                                                suppliers which are not solicited nor
                                                                                                                                   In  its response to the Commission questionnaire,  BIPAR explained  that
                                                                                                                                   BIPAR supports the European Commission’s initiative to carry out an evalu-  consented by the consumers. The DMD
                                                                                                                                   ation of the DMD. BIPAR welcomes in particular the Commission’s inten-  applies to insurance intermediaries
                                                                                                                                   tion to focus its evaluation on the functioning of the DMD from “a cost/  when distributing products under
                                                                                                                                   benefit and burden reduction perspective”.
                                                                                                                                                                                                     an organised distance sales /service
                                                                                                                                   Since the adoption of the DMD in 2002, new sector specific EU rules apply-  provision scheme and exclusively
                                                                                                                                   ing  to  the  distribution  of  financial/insurance  services/products  like  the   via one or more means of distance
                                                                                                                                   Insurance Distribution Directive (IDD) and new horizontal EU rules on con-  communication.
                                                                                                                                   sumer protection like the General Data Protection Regulation (GDPR) have
                                                                                                                                   been introduced. These new EU rules have introduced new pre-contractual
                                                                                                                                   information or disclosure requirements. BIPAR therefore agrees with the
                                                                                                                                   Commission’s approach to evaluate the interplay of the DMD with these
                                                                                                                                   new EU rules, and to avoid any possible duplication in particular for the
                                                                                                                                   sake of better consumer protection and legal clarity.  Therefore, any revised
                                                                                                                                   DMD should only include requirements specific to the distance marketing
                                                                                                                                   of consumer financial services/products and focus inter alia, for example,
                                                                                                                                   on a better protection of vulnerable consumers.

                                                                                                                                   BIPAR also underlined that the technology-neutral approach of the DMD is
                                                                                                                                   completely appropriate and should be maintained. It prevents distortion of
                                                                                                                                   competition and does not favour one channel of distribution in particular.
                                                                                                                                   Regulation should deliver the same protection regardless of channel and
                                                                                                                                   consumers will determine what suits them best. It is important that all con-



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