In February 2012, the European co-legislators, i.e. the European Parliament and the Council of the European Union ( ) representing governments, adopted the ‘Regulation ( ) No 260/2012 establishing technical and business requirements for credit transfers and direct debits in euro’, also known as the Single Euro Payments Area ( ) Regulation. This legislative act effectively mandates migration to Credit Transfer and Direct Debit in the euro area by 1 February 2014. To avoid difficulties for non-compliant market participants, in February 2014 the European Commission, the European Parliament and governments agreed amending the Regulation to give the option to continue processing non- formats until 1 August 2014. However, 1 August 2014 does not mark the end of the migration process. The following deadlines also apply:
1 February 2016:
- Transitional arrangements in Member States: the Regulation has introduced several possible exemptions regarding the use of the International Bank Account Number (IBAN), the Business Identifier Code (BIC) and the ISO 20022 XML message standards by the February 2014 deadline. Member States have discretion as to whether they will use any or all of the options to derogate from the 1 February 2014 deadline (until 1 February 2016) with regard to the use of the IBAN, the BIC and the ISO 20022 XML message standards by payment service users.
- Niche products, which have been granted an exemption: the Regulation, in particular, stipulates that credit transfer and direct debit transactions with a cumulative market share of less than 10 percent in an Member State must comply with the provisions set out in this legislative act only by 1 February 2016.
31 October 2016: non-euro countries will have to comply with the Regulation by 31 October 2016.
It is important that, following 1 August 2014, countries in- and outside of the euro area do not overlook these other deadlines, but rather actively prepare to ensure that they are ready to meet them on time. Meeting the next deadlines established by the lawmakers requires continued and coordinated efforts by the public authorities driving the process, the representatives of payment service users as well as banks and other service providers.
On 17 July 2014, the European Payments Council ( ) published a blog, entitled ‘1 August 2014 Does Not Mark the End of the Migration Process. Get Ready for 2016. Act Now’ (see ‘related links’ below). This blog summarises best practices identified in the euro area during the migration process. The recommendation is to take advantage of the lessons learnt when preparing for 2016.
(Note: the is not an legislative body. More generally, the is not part of the institutional framework. The has, therefore, no role in the adoption of any laws or other regulatory initiatives establishing compliance requirements.)
If you would like to comment on this article, please identify yourself with your first and last name. Your name will appear next to your comment. Email addresses will not be published. Please note that by accessing or contributing to the discussion you agree to abide by the EPC website conditions of use.