The European Commission has recently published (2 September ) a roadmap on its forthcoming green paper on retail financial service and insurance.

The objective of this Green Paper is to consider the obstacles faced by providers and consumers when offering or purchasing financial services across the EU. It will investigate issues not yet addressed in legislation and identify competition obstacles.

At present, the Commission is concerned that there is insufficient cross-border trade in retail financial services and insurance which has resulted in unsatisfactory price differentials. For instance, a comparable simple life insurance product ranges from €123 to €606.

The key issues identified for the green paper include:

  • Lack of transparency: customers are unclear on the price and features of a product
  • Lack of cross-border trade: this is partly due to compliance costs, as national regulatory and legal requirements can vary hugely across member states. In addition, attracting customers across borders can be challenging and dealing with post-contractual matters presents difficulties.
  • Consumers relocating to another member state may be forced to discontinue their insurance policies as a result of current market fragmentation.

The Commission intends to publish the green paper in the third quarter of 2015.