On 8 October 2019, the members of the European Parliament’s Economic and Monetary Affairs (ECON) and Employment and Social Affairs (EMPL) committee questioned Commissioner-designate Valdis Dombrovskis in a nearly three-hour long joint hearing. Once approved, Dombrovskis, who is Commission President-elect Ursula Von Der Leyen nominee to be the new Executive Vice-President for a Europe that Works for People, will continue to be responsible for Financial Stability, Financial Services and the Capital Markets Union within the newly appointed College of Commissioners. During what was considered to be a formality and ended being a rather uneventful hearing, Dombrovskis re-instated his main policy objectives for the upcoming Commission’s term as previously communicated to ECON and EMPL in his responses to a list of preliminary questions. Overall, Dombrovskis is broadly considered as a candidate that offers a steady continuation of the leadership of DG FISMA and today’s hearing only reinforced this perception. As such, he is expected to face no problems in obtaining the Parliament’s approval for his nomination – as indicated in informal commentary by ECON and EMPL members following the hearing.

Key points to note on today’s hearing include:

1. The vast majority of questions posed by Members of the European Parliament (MEPs) focused on other areas of Dombrovskis’ future portfolio, i.e. the social dimension of the next Commission’s strategy. MEPs questioned Dombrovskis on how the next Commission would ensure that EU citizens would profit from its envisaged policies. Dombrovskis reassured the MEPs that the next Commission will focus on inclusive and sustainable growth translating in tangible benefits for EU citizens. The social pillar would also get a more prominent role in a number of policies such as the European Semester.
2. In the area of financial services legislation, MEPs mainly focused on the issue of the EU fight against money laundering. Dombrovskis reinstated his objective to strive for closer harmonisation of the current anti-money laundering (AML) and counter-terrorist financing (CTF) legal framework, and he pledged that the supervision and coordination of AML and CTF rules should be transferred to the EU level. Dombrovskis considered the European Banking Authority to be the best candidate to take on these tasks.
3. Other elements of financial services legislation and regulation that were addressed during today’s hearing focused on sustainability and the climate transition issues. Dombrovskis vowed to remain ambitious on the implementation of the Sustainable Finance Action Plan and to finalise the remaining initiatives on the sustainable finance taxonomy, green bonds and the ecolabel for financial products. At the same time, the next Commission would work with the European Investment Bank to mobilise EUR 1 trillion into sustainable investments.
4. With regard to the Banking Union, Dombrovskis remains committed to finalise the missing aspects, such as the European Deposit Insurance Scheme and the proposal on Sovereign Bond-Backed Securities. Further development of the Capital Markets Union remains a part of the agenda as well. The Commission will keep working on facilitating access to finance for small- and medium-sized enterprises.
5. Dombrovskis stated that the Commission is currently looking into ways to regulate digital assets such as Facebook’s proposed virtual currency called Libra. He wants to develop a common approach among Member States and intends to propose legislation on this during his term. On Libra specifically, Dombrovskis confirmed that the Commission has sent a list of questions to Facebook, but that it has received no response to date.

In terms of next steps, after today’s hearing both ECON and EMPL will prepare their evaluation of Dombrovskis’ expertise and performance, and send it to the President of the Parliament. As no surprises are expected in relation to Dombrovskis’ nomination, he will be included in the final composition of the College of Commissioners which will be subject to the European Parliament’s plenary vote during the session starting on 21 October 2019. If the plenary approves the appointment of the proposed College of Commissioners, the new Commission will commence its work on 1 November 2019. Yet, rejections of individual candidate-Commissioners during the Committee hearings stage could delay the start of the new Commission as the Parliament needs to appoint the College as a whole.