Sep182017

State aid: Commission approves alternative to divestment commitment for Royal Bank of Scotland

EU

Today’s decision follows the agreement in principle reached on 26 July 2017 between Commissioner Vestager and the UK Government.

In April 2017, the Commission opened an in-depth investigation to assess whether the alternative package proposed by the UK authorities could be considered an appropriate replacement for the original commitment to divest part of its UK retail and SME banking operations known as Williams & Glyn (also known as “Rainbow”). This commitment to divest Williams & Glyn was made by the UK authorities as part of RBS’s restructuring plan submitted in 2009 and amended in 2014, to remedy competition concerns in the concentrated UK SME banking sector, where RBS is the leading bank.

The Commission can only accept modifications to existing commitments by Member States and aided banks that were given to obtain approval for restructuring aid (such as the one leading to the existing RBS restructuring decision), if the new commitments can be considered equivalent to those originally provided.

In this context, the opening of the in-depth investigation also gave interested parties the possibility to submit to the Commission their views on the new commitments and the Commission received comments from many parties. The UK authorities proposed amendments to the package to take into account some of those comments and ensure equivalence of the alternative package with the divestment it would replace. In particular, the package targets a transfer of a 3% market share in the UK SME banking market from RBS to challenger banks.

The Commission’s investigation concluded that the improved package is sufficient to replace the divestment commitment and will increase competition in the UK SME banking market:

  • The Capability and Innovation Fund will be distributed to eligible challengers to develop their capability to compete with RBS in the provision of banking services to SMEs and/or develop and improve their financial products and services available to SMEs.
  • The Incentivised Switching Scheme will provide funding to eligible challengers to enable them to offer incentives to encourage RBS’s SME banking customers to switch their business current accounts, deposit accounts and loans.

On this basis, the Commission approved the UK’s improved alternative package under EU State aid rules.

Background

RBS is one of Europe’s largest financial services groups and had a balance sheet of £799 billion at the end of 2016. During the financial crisis, in late 2008, RBS was on the verge of collapse and has benefitted from the following state aid measures:

  • a recapitalisation of £45.5bn and an (eventually unused) five year contingent recapitalisation of £8bn
  • an impaired asset measure covering excess loss (which was terminated with RBS not having received any payments from the State, but instead paid a cumulative fee of £2.5bn for the participation) and
  • guarantees and other liquidity measures (now fully repaid).

These aid measures resulted in the UK Government holding the majority of RBS’s shares and were accompanied by the restructuring of RBS approved by the Commission in 2009 and amended in 2014.

As part of this restructuring, the UK committed RBS would undertake a significant balance sheet and risk reduction. RBS has already delivered on those commitments to ensure the bank’s long-term viability, in line with the Commission decision. It also delivered on all its other divestment commitments (sale of RBS insurance, transaction business, commodity trading, US banking subsidiary), which were made to ensure adequate own contribution by the bank to the financing of the restructuring of the core UK banking operations and to limit the distortion of competition. The divestment of Williams & Glyn, to be completed by end-2017 is the last outstanding commitment, with the objective to mitigate the distortion of competition in the UK SME banking market. This commitment has now been replaced with the new commitments from the UK relating to the alternative package.

The non-confidential version of this decision will be made available under the case number SA.47702 in the State Aid Register on the competition website once any confidentiality issues have been resolved. New publications of state aid decisions on the internet and in the Official Journal are listed in the State Aid Weekly e-News.

Sep182017

‘Window of opportunity’ closing on non-communicable diseases, warns UN health agency

United Nations

18 September 2017 – Millions around the globe are dying prematurely from diseases such as cancer or heart disease, the United Nations health agency warned, urging governments to step up efforts to control non-communicable diseases (NCDs).

“Limited national progress has been made in the fight against NCDs – primarily cardiovascular and chronic respiratory diseases, cancers and diabetes – which are the world’s biggest killers,” noted the UN World Health Organization in a news release today.

According to estimates, 15 million people aged 30-70 succumb to these diseases annually. Furthermore, the latest edition of the WHO Non-communicable Disease Progress Monitor shows that progress around the world to control such conditions been uneven and insufficient, and over three-fourth of the deaths in low- and middle-income countries.

“Bolder political action is needed to address constraints in controlling NCDs, including the mobilization of domestic and external resources and safeguarding communities from interference by powerful economic operators,” said Tedros Adhanom Ghebreyesus, the WHO Director-General, in his foreword to the Progress Monitor.

SEE ALSO: More people warned against tobacco use, but industry interference continues, reports UN

The findings also reveal that the world is not on track to meet one of the key health targets of the Sustainable Development Goals (SDGs) on reducing premature mortality from NCDs by a third by 2030.

Underscoring that “the window of opportunity is closing,” on being able to save increasing number of people, particularly children and adolescents, Douglas Bettcher, the Director the Department for Prevention of NCDs at WHO urged: “If we don’t take action now to protect people from NCDs, we will condemn today’s and tomorrow’s youth to lives of ill-health and reduced economic opportunities.”

The Progress Monitor provides data on 19 indicators in all of WHO’s 194 member States, such as setting time-bound targets to reduce NCD deaths, developing comprehensive policies to address NCDs; implement key measures to reduce tobacco demand; reduce harmful use of alcohol, and promote healthy diets and physical activity; as well as strengthen health systems through primary health care and universal health coverage.

Findings contained in this year’s edition will form the basis for a WHO study later this year which will be released ahead of the third UN High-level Meeting on NCDs (to be held in 2018).

Sep182017

Iran implementing its nuclear commitments, UN atomic agency chief stresses

United Nations

18 September 2017 – Iran is implementing its commitments under “the world’s most robust nuclear verification regime,” the United Nations atomic agency head said today, while at the same time voicing “grave concern” at the Democratic People’s Republic of Korea’s (DPRK) nuclear programme.

“The nuclear-related commitments undertaken by Iran under the JCPOA are being implemented,” UN International Atomic Energy Agency (IAEA) Director General Yukiya Amano told the opening of the Agency’s annual General Conference in Vienna.

Endorsed unanimously by the UN Security Council in 2015, the Joint Comprehensive Plan of Action (JCPOA), between its five permanent members (China, France, Russia, the United Kingdom and the United States), plus Germany, the European Union (EU) and Iran, set out rigorous mechanisms for monitoring limits on Iran’s nuclear programme, while paving the way for lifting UN sanctions against the country.

“Iran is now subject to the world’s most robust nuclear verification regime,” said Mr. Amano, who was appointed by acclamation today to another four-year term as Director General of the 169-member Agency.

Turning to the DPRK, he called upon it to comply fully with its obligations under all relevant Security Council and the IAEA resolutions.

“The nuclear test by the DPRK on September third, its sixth and largest to date, is extremely regrettable,” he said. “The Agency is working to maintain its readiness to return to the DPRK when political developments make this possible.”

On 11 September, the Security Council unanimously imposed tighter sanctions on the DPRK, including limits on oil exports to it, banning its textile exports and its access to gas liquids, and more closely inspecting cargo ships going in and out of its ports.

The Council has passed eight resolution over the DPRK’s nuclear programme since it withdrew from the Nuclear Non-Proliferation Treaty (NPT) in 2003, many involving increasingly severe sanctions.

Turning to other matters within the Agency’s remit, Mr. Amano stressed its unique role in transferring nuclear technology to developing countries, and its work in supporting countries achieve the UN Sustainable Development Goals in energy, food and agriculture, industry, water management and health.

“The Agency will continue to deliver high-quality programmes and respond promptly to Member State needs,” he said, noting that the modernization of the IAEA nuclear applications laboratories near Vienna was making excellent progress and the new Insect Pest Control Laboratory would be inaugurated in a week’s time.

“When completed in a few years’ time, the expanded laboratory complex will greatly increase our capabilities as a technology holder,” he added.

Sep182017

Press release: Update on Government response to Hurricane Irma and Maria

HM Government

We remain concerned that Hurricane Maria, which is strengthening as it approaches the Leeward Islands, could hit the UK’s Overseas Territories in the Caribbean already affected as well as Montserrat.

FCO, DFID and military teams are working closely with the Governors in the Overseas Territories to ensure we are doing all we can to support the Governments of the islands affected.

Ministers discussed the preparations that have been put in place:

  • Over 1300 military troops are staying put in the region – either on the islands already affected or in locations from where they will be able to readily deploy once Maria has passed.
  • An additional 42 strong military resilience team has been deployed forward to British Virgin Islands prior to Hurricane Maria ready to support additional needs there.
  • A military reconnaissance team has been put on standby to go to Montserrat to assess need if it is hit by Hurricane Maria.
  • DFID has established logistics hubs in the Dominican Republic, Barbados and Antigua & Barbuda to ensure swift supply of relief items if required and is procuring additional supplies from Miami and Panama.
  • HMs Ocean, which is due to arrive in the region at the end of the week, with 60 tonnes of DFID supplies on board will be deployed according to need once Hurricane Maria has passed.
  • On the basis of the latest weather forecast, we are advising against all but essential travel to Montserrat and Anguilla and against all travel to the British Virgin Islands.
  • All those in the region are urged to follow the advice of the local authorities.

To date, the UK government has allocated £57 million to the immediate response effort and agreed to match up to £3 million of public donations to the Red Cross appeal.

75 tonnes of DFID relief items have either arrived or been procured in the region including much needed food, water, nearly 3,000 shelter kits, 5,000 hygiene kits and 10,000 buckets.

40 tonnes of humanitarian aid has been distributed including over 4 tonnes of food and water on the British Virgin Islands; 720 litres of water to the Turks and Caicos Islands; and over 2 tonnes of building materials to Anguilla.

Sep182017

Press release: Update on Government response to Hurricane Irma and Maria

MOD

We remain concerned that Hurricane Maria, which is strengthening as it approaches the Leeward Islands, could hit the UK’s Overseas Territories in the Caribbean already affected as well as Montserrat.

FCO, DFID and military teams are working closely with the Governors in the Overseas Territories to ensure we are doing all we can to support the Governments of the islands affected.

Ministers discussed the preparations that have been put in place:

  • Over 1300 military troops are staying put in the region – either on the islands already affected or in locations from where they will be able to readily deploy once Maria has passed.
  • An additional 42 strong military resilience team has been deployed forward to British Virgin Islands prior to Hurricane Maria ready to support additional needs there.
  • A military reconnaissance team has been put on standby to go to Montserrat to assess need if it is hit by Hurricane Maria.
  • DFID has established logistics hubs in the Dominican Republic, Barbados and Antigua & Barbuda to ensure swift supply of relief items if required and is procuring additional supplies from Miami and Panama.
  • HMs Ocean, which is due to arrive in the region at the end of the week, with 60 tonnes of DFID supplies on board will be deployed according to need once Hurricane Maria has passed.
  • On the basis of the latest weather forecast, we are advising against all but essential travel to Montserrat and Anguilla and against all travel to the British Virgin Islands.
  • All those in the region are urged to follow the advice of the local authorities.

To date, the UK government has allocated £57 million to the immediate response effort and agreed to match up to £3 million of public donations to the Red Cross appeal.

75 tonnes of DFID relief items have either arrived or been procured in the region including much needed food, water, nearly 3,000 shelter kits, 5,000 hygiene kits and 10,000 buckets.

40 tonnes of humanitarian aid has been distributed including over 4 tonnes of food and water on the British Virgin Islands; 720 litres of water to the Turks and Caicos Islands; and over 2 tonnes of building materials to Anguilla.

Read more about the government’s response and advice for people affected by Hurricane Irma.