Eversheds has commented on the European Council’s approval of an agreement with the European Parliament on the proposed draft SEPA Migration Regulation relating to credit transfers and direct debits.
Fiona Ghosh, partner at Eversheds, said: ‘Following increasing evidence that many European businesses were struggling to meet the 1 February 2014 deadline, it comes as no surprise that the European Commission has extended the deadline for compliance by six months.
‘The European Commission was concerned that migration rates towards SEPA credit transfers and SEPA direct debits were not high enough to ensure a smooth transition and this additional six months will allow banks and other payment service providers to continue the processing of non-compliant payments through their currently existing legacy payments schemes, alongside SEPA credit transfers and SEPA direct debits, until 1 August 2014.
‘The introduction of this period is considered as an exceptional measure by the European Commission that will not be extended any further, so the message is very much that this is the “last-chance saloon”.
‘The European Parliament is expected to vote accordingly in its plenary session in February and the council will subsequently formally approve the legislation without further discussion. The proposed regulation should enter into force as a matter of urgency and apply, with retrospective effect, from 31 January 2014.’