1. Financial Transaction Tax (FTT) Commission proposal for a Directive Council Legal Service opinion Council decision authorising enhanced cooperation January 2013 Directive February 2013 September 2013 Overview The European Commission adopted its initial proposal for a financial transaction tax on 28 September 2011. However by mid-2012, Finance Ministers decided at ECOFIN that they could not reach unanimous agreement on the proposal. Nonetheless, a number of Member States expressed a strong willingness to go ahead with the FTT. In September 2012, the Commission received a request from 11 Member States (Austria, Belgium, Germany, Estonia, France, Greece, Italy, Portugal, Slovakia, Slovenia, and Spain) to introduce a common system of FTT based on the scope and objectives of the Commission's initial proposal through the procedure of “enhanced cooperation”. On 23 October 2012 the Commission proposed to the Council to authorise the enhanced cooperation requested by these eleven Member States. The European Parliament gave its consent for on 12 December 2012 and the Council adopted a decision authorising the eleven Member States to go ahead with the requested enhanced cooperation on 22 January 2013. Scope of the FTT Transactions on regulated/organised markets as well as over the-counter transactions Transactions (such as sale/purchase, lending/borrowing, transfer of ownership, conclusion or modification of derivative contracts) in financial instruments Financial institutions (banking and "shadow-banking" sector) from the EU that are party to the transaction acting either for their own account, or for the account of another person, or are acting in the name of a party to the transaction Latest News Following the Economic and Financial Affairs (ECOFIN) Council meeting on 6 May 2014, Finance Ministers of the countries participating in the FTT reiterated their commitment to work on the basis of a step-by-step approach, starting with taxation on shares and some derivatives in January 2016 at the latest. On 30 April 2014, the European Court of Justice dismissed the action brought by the UK against the decision authorising eleven Member States to establish enhanced cooperation in the area of FTT. The Council’s Legal Services’ legal opinion found that a transaction tax on foreign exchange operations is compatible with the EU Treaties; whilst FX operations could only be included within the scope of the FTT following a proposal by the Commission. In the European Parliament, Eva Kaili, the Greek MEP, will be the in charge of the Financial Transactions Tax (FTT) dossier. The FTT was discussed at the margins of the informal ECOFIN meeting on 13 September 2014. Post-meeting declarations from the French and German finance ministers indicated that the 11 Member States involved in the FTT aim to define by the end of 2014 which financial instruments should be covered by the tax. This agreement, which won’t tackle all the FTT details, is seen as necessary and useful for further steps and to possibly convince also other countries to join.