Thread by @lidiafopereira

🚨About the Transfer of Funds Regulation (TFR), follow the below thread 🧵👇

#ECON and #LIBE committees approved, today, the mandate for negotiations on the TFR. As @EPPGroup shadow rapporteur for the file, I think it is important to make myself clear on our position. 1/16

Our priorities: 1) insert crypto-assets in the scope of TFR in a way that is innovation-friendly and avoid unproportioned compliance burden for companies and citizens; 2) safeguard a proper level playing field between wire and crypto transfers; 2/16

3) tackle the concrete situation of #unhosted wallets, without banning them, as it was proposed; 4) guarantee high standards of data protection; 5) align this file with the European legislation on crypto-assets and anti-money laundering. 3/16

This is a technical and political sensitive piece of legislation requires much more time, debate, negotiations and dialogue with stakeholders. The rush to approve a position led us to a text that could have been more balanced. 4/16

We accomplished a lot on negotiations within political groups, but important @EPPGroup objections remained in the text. I want to underline two of them: "de minimis" threshold and unhosted wallets. 5/16

The deletion of the de minimis threshold to trigger the obligations provisioned in the Regulation for providers of crypto-assets transfers, that was proposed by the Commission, is an error. This creates an unlevelled playing field for crypto and wire transfers; 6/16

and it can represent a major obstacle – through additional compliance costs for companies and citizens – to innovation in financial services. 7/16

On unhosted wallets, it is only natural that these wallets must be addressed in the Regulation, but the path to a ban is not the solution. 8/16

Banning is to condemn part of the industry, to create a wrong association to criminal activity of people that legitimately use these wallets and is to block the transfers to or from regulated providers of crypto-assets transfers, minimizing the potential impact of the TFR. 9/16

The final drafting is not a total ban, but can lead to a de facto ban, if regulated providers face major costs on the operational level of identification and verification. 10/16

In a time of economic recovery and digital transition, the EU must stand by innovation, technological development and new financial solutions for companies, investors and individual citizens. 11/16

Instead of limiting our space for decision, the EU must promote economic freedom and fair competition. Using this Regulation to create an anathema on crypto-assets and its users, associating almost automatically investments on crypto to criminal activity, is the wrong way. 12/16

However, political groups agreed on important matters related to data protection, the link to AML/CFT, the inclusion of restrictive measures, the systematic coherence with the crypto-assets legal framework, among other specific (but important) issues. 13/16

I want to remind that the decision of the EP is not the final draft of this revised legislation. We are now starting negotiations with the EU Council to reach the final version of this legislation. 14/16

We were a minority position in some compromises and we accept the democratic outcome, voting in favor of the mandate to start negotiations. @EPPGroup will keep its commitment to these aspects of the EP position and will closely follow negotiations with the Council. 15/16

In the end, we will have to vote the final version and we will have a new opportunity to stand with our views on the matter. @EPPGroup will always stand by innovation, entrepreneurs and citizens initiative to generate growth and create jobs. 16/16