“Completing the Single Market by 1992” . It's a familiar sentence now. And so it should be. When the twelve heads of Government met in Hanover in June, we agreed that the process of completing the Single Market was irreversible. That does not mean that the job is already finished. There is a lot to do. But we know that we will finish it.
We had good reason to say that. We had reached agreement on key points of the programme: —freeing capital movements; —removing lorry quotas; —letting professionals use their qualifications freely throughout the Community subject to clear and simple rules; —enabling non-life insurance companies to cover risk anywhere in the Community without establishing a local presence in the host market. [end p1]
And besides those, there were dozens of other steps agreed under the German Presidency. Measures that mean that the European market is being freed for enterprise, competition and growth. That the vision of the founding fathers is being given a practical form that will benefit all of Europe's citizens.
I am glad to say that a large part of what we have achieved has been in financial services. It is an area to which we in the United Kingdom, like you in Luxembourg, give priority. And it is becoming an area that demonstrates what the Member States can do when they set to work: look at capital movements. The measures involved were proposed, negotiated and adopted in the space of just six months.
Useful steps have been taken in the past—measures on supervision, bankers' annual accounts, listing of securities [end p2] and so on. But now we are really getting into our stride. Agreement on capital liberalisation was a first big step. I want to press on now, to a genuinely free market in financial services.
Key proposals are already on the table. Let me highlight two:
First, the Second Banking Co-ordination Directive will allow banks to operate throughout the Community with a single home country authorisation.
Second, the Investment Services Directive will enable institutions other than banks to offer securities services freely, again with a single home country authorisation.
Other proposals will open up other areas, such as insurance.
We support all of this. Of course, we are not uncritical. We argue against proposals which will cause problems. [end p3]
For, since our purpose is to liberalise the market, we have resisted whenever we think that what is proposed will mean unnecessary regulation.
And we have done so for example over the proposed mandatory reciprocity provisions in the Second Banking Directive and the Investment Services Directive. Of course we want others to open their markets as we are doing. But we should not remove barriers within the Community only to build up new ones around it.
We want to see a European financial services market that works. We have a very successful financial services industry in the United Kingdom. We believe it has a great deal to offer in Europe, and will earn its place in the heart of the new open market. But we also believe that competition in that market will benefit the whole [end p4] of the European financial services sector. If that sounds like a challenge, it is meant to be. A challenge to all of us to make the most of the Single Market.