Proposition 50K1221

Projet de loi relatif à la prise de participation de l'Etat dans une société anonyme ayant pour objet social principal l'exploitation d'une plate-forme de trading électronique sur le marché secondaire des titres de la dette publique belge.

General information ¶

Submitted by

Groen Open Vld Vooruit PS | SP Ecolo MR Verhofstadt Ⅰ

Submission date

April 26, 2001

Official page

Visit

Status

Adopted

Requirement

Simple

Subjects

public debt

Voting ¶

Voted to adopt

Groen CD&V Vooruit Ecolo LE PS | SP Open Vld N-VA MR FN VB

Contact form ¶

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Discussion ¶

July 17, 2001 | Plenary session (Chamber of representatives)

Full source

I refer to the written report.

Mr. Speaker, it is obvious that in the discussion of this draft and the next two agenda items we are advancing the Minister of Finance.

Was the Minister of Economic Affairs there?

I ask the Minister of Finance. These are two drafts and a very strange bill, all three of which are within the competence of the Finance Committee. With regard to MTS, I have very precise questions to which I would like to get very precise answers from the Minister of Finance. Ministers should be able to be present at draft legislation that concerns them.

First, the draft law on the electronic trading platform in the secondary market will be addressed.

The Minister is there. and Ecce Homo. Mr. Leterme, I did not know that the opposition was so powerful.

Mr. Minister of Finance, I could hardly find out that you were already there!

This is good for one time, but not two, Mr. President!

You have taken the lesson well, Mr. President.

Mr. Speaker, contrary to what the total lack of interest from the majority could suggest, this is an important bill. Good management of public debt has always been important. Also in the previous legislatures, a significant part of the restructuring effort has gone through active debt management. At a time when we are discussing a draft law aimed at enabling this debt management through a better organisation of the auction of state securities or debt securities, it is important to pay due attention to it. I do not have to remind the chairman of his past life. Mr. Speaker, a member of the parliament of the liberal family once discussed the problem of SWAPS in this plenary session.

I remember something.

I did not dare to propose anything else.

and no. I know that domain well, but I remember that the minister must have come here from Washington and not from the coffee room.

Mr. Speaker, this immediately explains why I then, with a certain urge, asked the Minister of Finance to do what he is paid for, in particular defending his bills in the plenary session. Active management of public debt is important in the sanitation of our public finances. The chairman rightly reminded us of this at the time.

In order to make our voting behavior immediately clear, I would like to inform you that we will support this bill. We would like to explain quite clearly why we support this bill. I may go ahead on a possible argument from colleague Pieters, but I will also explain what we have a few questions about.

What is this bill about?

I think it is important to emphasize this again because the reporter failed to present his report. This is becoming a bad parliamentary tradition. Col. D'Hondt, I don't know if this is mentioned in your new Rules of Procedure — which was presented here last week and welcomed with applause — but colleagues first struggle for the journalism around drafts and then thicken it with the same tenacity to report in the plenary session. This is covered in an annexed Article 7 of the Rules of Procedure. In any case, I agree that this is happening more and more. Therefore I want to loco the reporter, my good and valued friend Jef Tavernier — insiders know what this means — briefly sketch what it is about.

With the establishment of the MTS trading platform for the trading of government debt securities on the secondary market, it is intended to provide a legal basis for the participation of the Belgian State in the secondary market. The capital of that new legal entity consists of EUR 400,000, of which EUR 300,000 is sufficient, spread over a third of the shareholders. The first shareholder is a privatized Italian company, the MTSSPA — SPA is probably an Italian abbreviation — which becomes a 20% shareholder in this company.

The second category of shareholders are the primary dealers. They have a floating shareholding of 76,5% of the corporate capital of MTS Belgium with an amount of 306,000 euros. MTS Belgium was founded in May 2001. We will now learn the legal basis retroactively.

However, the reason why we are discussing this bill in the plenary session of the House is the fact that the Belgian State is the third shareholder. The state owns 3.5% or 14,000 euros of the social capital of MTS Belgium. The Belgian State may temporarily raise its share up to 150,000 euros. According to the text of the bill, which we will approve, the Belgian State may temporarily increase its share if primary dealers, who belong to the second category of shareholders and who own 76,5% of the shares, would decide to withdraw from the corporate capital of MTS Belgium. The Belgian State may temporarily increase the share of 3.5% with a value of 14,000 euros in the social capital to 150,000 euros.

Mr. Reynders, my first question is: why was that exact amount of 150,000 euros predetermined? Why not 180,000 or 180,000 euros? Why was a ceiling established for the Belgian State in the shareholding of MTS Belgium?

A question in its extension. Suppose that at a given time, in the context of transactions or the withdrawal of primary dealers from the shareholding of MTS Belgium, the Belgian State would temporarily increase its share in the legal entity to EUR 120,000. Does the Belgian State then obtain all normal shareholder rights associated with holding 30% of shares?

In the report of the discussions I read that there is a mandate deadline of the primary dealers. If I am right, that deadline has expired at the end of 2000. I quote from the strange report of colleague Tavernier: "At the end of their mandate, being the mandate of the primary dealers, 24 months after 1 January 1999...". I assume that the end of the term of the mandate is then foreseen on 31 December 2000. This would be logical if the text is taken literally. Who is the potential acquirer of the shares from 1 January 2001? Is this the Belgian state? What about the retroactive effect of the bill we are discussing here? I expect an answer to this, given the importance of the matter we are dealing with here.

Mr. Minister, I could have asked my questions in the article-by-article discussion, but I try to gain time by asking them now.

Article 2 of the bill stipulates that the main social objective of the company MTS Belgium is the trading of debt securities of the Belgian State on the secondary market. In the jurisprudence, I have always learned that the notion “the most important” a contrario assumes that there is at least hypothetical — this must be proven from the policy practice, from the acts of the legal entity concerned — from the head of the company concerned, in this case MTS Belgium could also have other societal goals. Without accidents, the present bill will be approved. It is important that the Minister of Finance gives a clear answer to the question whether the legal entity has other social objectives than the main objective, in this case the trading of debt securities of the Belgian State on the secondary market.

The following question is rather a note and relates to the incorporation of the Belgium MTS in the European context. We can, in my opinion, be satisfied that we are discussing this bill during the Belgian European Presidency. Mr. Minister, as chairman of the Ecofin Council and walking from one success to another – let us think of the coordination centers, the Tobint Tax, the euro tax – you may be the cut person to inform us about the insertion of MTS Belgium in the broader European framework. If I am properly informed, our country is now part of EuroMTS, which is already trading the benchmarks of the Belgian government debt. EuroMTS does not trade all debt securities but the benchmarks. The question is whether with the arrival of the euro in a hurry – this is not a hypothesis but a reality – but also with the recent transnational cooperation via Euronext on the stock exchange floor and an increasing internationalisation of the financial world, the participation of the Belgian State in a Belgium MTS is opportune at the moment that the EuroMTS is already active and the Belgian State participates in it. Why is a national platform established? One could draw a parallel with EuroNext that would trade the heavy shares while the national exchanges could remain competent for the small shares. Why does not one do the work of trading through EuroMTS of all debt securities and not only of the benchmarks? This could avoid double work.

As regards the composition of the debt position and the distribution of the securities debt, I wonder whether, in the light of the liberalized new European financial architecture, a national issue of debt securities has not been overlooked. What does the European Central Bank – you are well known through your good friend Duisenberg with whom you maintain very friendly and loyal relations – think of a unilateral participation of the Belgian State in the MTS Belgium whose activities can in fact be equally well accommodated in the EuroMTS?

Mr. Minister, these questions and comments deserve, in my opinion, an answer before the CVP group, which has been favorably accepted, approves the present draft.

Mr. Speaker, I would like to thank in particular all the groups that have wished to speak out on this debt management, which continues to improve but which, as has been said, has been in progress for a long time.

I understand that the debate was a little quick in the committee and that reading all the documents may not always have been possible. I will therefore simply answer the questions asked by referring, but by explaining them, both to the summary of the project as presented and to the exposition of reasons, or even to the report.

Why an intervention of the State, by means, despite the announced distribution of securities, a possibility of acquisition of securities up to a maximum amount of 150,000 euros? by

Simply because there is a link between the two devices. The "primary dealers" are designated for a period of 24 months from 1 January 1999; it was then anticipated that they could be a maximum of 17. And the Treasury, according to its estimates, estimates that, by means of a possibility of acquisition of securities at the competition of 150,000 euros, we could take back the securities of the “primary dealers” who should leave the platform before passing them to those who would reintegrate the platform following a new designation.

So there is actually a link – I understand the two questions of Mr. Leterme — between the deadlines for the appointment of "primary dealers" and the amount authorized by the State to acquire additional securities. The Treasury estimates – and I think it is reasonable – that with a maximum amount of 150,000 euros, we have quite enough possibilities to ensure the transfer while waiting for new “primary dealers” to be designated, if some should leave the platform.

I therefore find it reasonable both to announce the distribution as it is found in the summary and in the exposition of reasons, but also to allow the State to go up to a maximum of 150,000 euros. I obviously rely on the assessment made by the Treasury in discussion with the "primary dealers". There is sufficient portable capacity to allow passing the deadlines for the appointment of these speakers.

As regards the main social object, it was not intended to limit itself to a specific electronic platform. The exhibition of the reasons also alleges: the will is to allow that, according to technological developments, the social object that indicates a main social object allows to eventually go to new technologies such as MTS technology and, why not, to a technology that could go through European integration. by

I totally agree with the comment also made: why some national platforms for now and not directly from transnational organizations? Simply that the link with Euronext is logical but not quite relevant in the sense that here we are talking about the intervention platform for public operators. It is not excluded that, in the future, we can actually put together various operators. Some agreements have already been reached for the timetable for the issuance of public debt securities between different European issuers and I do not rule out that one day we can go further. What the project envisages in any case, is actually a main social object to allow to adapt either to new technologies or to new developments of rapprochement between operators from different countries.

That being said, I acknowledge that this is an operation that eventually comes to cover an approach already carried out within the framework of the operator itself. Therefore, there is a retroactive effect to the proposed measures. But the announcement of the creation of MTS-Belgium is an announcement made in the presentation of previous reports on the management of public debt.

I am pleased that all the groups that have expressed their views on this topic support the approach to modernize debt management. I think they will be able to understand that it is useful to have some flexibility in order to allow the possible replacement of certain partners. This is what is provided in the provision that allows the State to acquire a certain number of securities for a maximum amount of 150,000 euros, but also that the flexibility allows to make the concrete activity of MTS-Belgium evolve according both to the technological development on other electronic platforms, but ⁇ also according to the evolution between different platforms of countries that work in the same way on this public debt market.

Mr. Speaker, I would like to thank the Minister for answering many of my questions. However, there is at least one question to which I have not been answered.

Mr. Minister, has the temporary holding of a shareholding, placed at a ceiling of EUR 150,000 — or approximately 30 % of the social capital of MTS Belgium — resulted in the Belgian State being able to effectively exercise all the rights associated with the shareholding at that time? Or is there an exceptional position, negotiated with the Italian shareholder?

The main purpose of the State is to be a quite marginal shareholder of the transaction, hence the reference to the 3.5% in the text. If a possibility has been envisaged to go beyond with the ability to exercise all shareholder rights that would be related to it, it is only to allow a transition when “primary dealers” withdraw because they arrive at the expiration of their 2-year appointment. It was therefore intended to prevent there being a hollow period between the end of a term and the designation of a new one. The state will therefore ensure a portfolio during this period. I repeat it and I believe my analysis is correct: the Treasury estimates that with a ceiling amount of 150,000 euros, we have all the guarantees to allow to take back the securities of some "primary dealers" while waiting to have to transfer them to others. The goal is, however, that at more than 75,5%, it is the "primary dealers" who are shareholders of the transaction with the Italian company responsible for the electronic platform. The state is there in a quite marginal way but will eventually be able to ensure the transfer to move from one "primary dealer" to another, each time a new appointment will intervene.

Mr. Minister, I may fall into repetition, but one thing I do not yet understand correctly. I refer to the strange report of colleague Tavernier, more specifically page 4. I admit that I was not present at the discussion in the committee, but when — I think it was in the spring of 2000 — a new member of the CVP group, belonging to the majority, observed that Mr. De Croo could not make a statement regarding elements that were discussed in his absence in the committee, he was executed by Mr. De Croo.

Therefore, there is a report.

Strengthened by the statements of the then opposition member, Mr. De Croo, I now take the freedom to draw attention to the fourth or fifth paragraph of the report. I quote: "At the end of their mandate, twenty-four months from 1 January 1999, however, a rearrangement of the corps of primary dealers could take place. In this assumption, the State must be able to make itself available.” This means that the period within which the rearrangement can take place since 31 December 2000 has expired.

We have, with retroactive effect, the possibility to intervene and acquire a number of securities. For each period of designation of "primary dealers", the deadline is determined. It is necessary to maintain this possibility for the State in the event of restructuring, thus of changing the composition of the "primary dealers", to redeem securities and then transfer them to new designated candidates. These are always fixed-term appointments. Per ⁇ , in the future, we will still need to benefit from this type of device. by

Here is the text: the provision is actually in force with retroactive effect. The first 24-month period is over, but the subsequent periods continue to exist. Article 2 § 1 permits the State to take a participation up to 150,000 euros but without limitation in time. This provision could apply to current designations. Whenever a period ends, or changes occur in the designation of the "primary dealers", it is necessary that the State can ensure the delivery before designating the new ones.

Mr. Minister, I hope I have understood you well, but please correct me if I am wrong. The passage in Mr. Tavernier’s otherwise strange report is somewhat confusing on this point. The report states that at the end of their mandate twenty-four months are counted from 1 January 1999. Is this possibility still open?

The effect of the draft law is not only retroactive but also applicable to the future.

Mr. Leterme, that is ⁇ the case.