After years of negotiation, the European Parliament’s Committee on Economic and Monetary Affairs (ECON) today approved the draft digital euro legislation and voted to open trilogue negotiations with the Council, clearing the way for a plenary vote expected in July. All fifteen of rapporteur Fernando Navarrete Rojas’s (EPP) compromise amendments were adopted, following a cross party agreement reached last week. Several counter amendments tabled by right of center groups PFE and ECR were rejected. ECON chair Aurore Lalucq described it as a “historic day for Europe.”
The approved text introduces significant changes to charges and compensation for payment service providers and tightens privacy protections to prevent the European Central Bank from accessing personal transaction data.
The legislation also includes some notable departures from earlier drafts. Legal entities such as companies will not be permitted to maintain a digital euro balance, other than temporarily in order to receive incoming payments. While there were never plans to pay interest on the digital euro, previous legislative drafts left the door open to potentially introduce it in the future. That door has been firmly shut. And while holding limits for individuals have been widely discussed and are maintained, the compromise adds a new overall ceiling on those limits, set via a Commission delegated act and reviewed every two years, with the goal of protecting financial stability.
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