1.1a2, Association for e-money institutions in the Netherlands

THE ELECTRONIC MONEY DIRECTIVE: RECAPITULATION AND OUTLOOK
On November 24, 2003, 1.1a2 published a working paper on the history and future of the E-money directive, to be discussed in the GTIAD meeting of November 27, 2003. Read the summary or download the Word document (199 kB).

See also our 2002-position paper on Electronic Money and Electronic Money Institutions. Read the summary of the 2002-paper or download the 2002-Word document (131 kB).

Background
As of July 1, 2002, the Dutch supervision law has been adapted to implement the EMI directive(s) that stipulate the supervisory regime under which non-bank companies may issue means of payments that serve as e-money. The new articles in the supervision law define a role for a representative organisation of e-money issuers. Such a representative organisation will, after having officially been declared 'representative' by the Ministry of Finance, be allowed to discuss the guidelines for supervision of e-money institutions with the competent supervisory authority.

Given this legal framework, the organisation 1.1a2 was established on June 10, 2002 to represent the new e-money institutions in the Netherlands. Its name, 1.1a2, is derived from the specific article in the supervision law that defines e-money institutions as those organisations that are not the traditional banks (under article 1.1a1) but that do issue electronic money to be used to pay other organisations than the issuer of e-money. In line with the definitions in the supervision law, membership for 1.1a2 is limited to the non-traditional bank players.

Membership
In the months before its establishment, 1.1a2 has assured itself of the commitment of new players in the market. Our members (all active market players before July 1, 2002) are:
-Global Payways/Moxmo (mobile phone payment system)
-EWLH/Digipay (mobile phone payment system)
-NMCA (sms payment system)
In line with its goal to represent the interest of its members and other e-money issuers in the Netherlands, 11a2 has asked the Ministry of Finance to be formally recognized as the representative organisation of e-money issuers.

Consultation round
On May 23, the Dutch central bank (in its role as the bank supervisor) started a consultation round with respect to the content of supervisory rules for e-money issuers. This round closed at the end of May. Our association's response, apart from some smaller technicalities, was that this period was too brief to be able to respond adequately. We have pointed to the fact that the time problem of a late implementation of the directive should not be shifted to the private organisations and that we hoped to be invited for a proper discussion of the supervisory rules and their effects on the market players.

Current activities
On june 11, 1.1a2 has held an informative half-day conference on the upcoming changes in legislation and the effects for market players. Following up on that 1.1a2 maintains information on the applicable rules for e-money issuers on it's website. Furthermore we are actively cooperating with the British electronic money association in order to maintain a European and international perspective on relevant issues such as:
- the application and interpretation of legislation in a way that is not depending on technical implementations,
- the equal interpretation and application of rules/guidelines accross the European Member States,
- the e-money definitions and issues in the FATF-review of the 40 Recommendations,
- the representation in discussions with the European System of Central Banks and the European Commission.

Organisation
The founders of the association are Kees Klomp, (chairman) and Simon Lelieveldt, (secretary/treasurer). Both can of course be e-mailed for additional information.

Some on-line publications

1.1a2, Association for e-money institutions in the Netherlands, The Electronic Money Directive: Recapitulation and outlook, a working paper made for the GTIAD-meeting of November 27, 2003, November 2003, Amsterdam.

1.1a2, Association for e-money institutions in the Netherlands, Electronic Money and E-money Institutions, a position paper on regulation, definitions and the market, November 15, 2002, Amsterdam.

Lelieveldt, Simon, Why is the Electronic Money directive significant?, Electronic Payment Systems Observatory-Newsletter Nr. 7 May 2001.

Vereecken, Marc, A Harmonised EU Legal Framework for Electronic Money, Electronic Payment Systems Observatory-Newsletter Nr. 7 May 2001.

Lelieveldt, Simon Where EMI-directive and mobile phone payment systems will meet .., Electronic Payment Systems Observatory-Newsletter Nr. 1 July 2000.

Lelieveldt, Simon L, How to regulate electronic cash: an overview of regulatory issues and strategies, American University Law Review, Vol 46, Nr 4, April 1997, pp 1163-1175.


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