EPC Version June 2012 EPC

Transcription

1 EPC Version June 2012 EPC SEPA DIRECT DEBIT CORE RULEBOOK CHANGE REQUEST CONSULTATION DOCUMENT The Single Euro Payments Area (SEPA) payment schemes, as set out in the SEPA Credit Transfer (SCT), the SEPA Direct Debit (SDD) Core Rulebook and the SDD Business to Business (B2B) Rulebook, evolve based on a transparent change management process adhered to by the European Payments Council (EPC). For details on the principles governing the annual EPC scheme change management process, refer to chapters 5, 6 and 7 in this document and the sources listed at the end of this page. This SDD Core Change Request 2012 (document EPC139-12) details suggestions for possible modifications to be introduced into the next version of the SDD Core Rulebook. This consultation document builds on suggestions for changes submitted by customer representatives, banking communities and by EPC Working and Support Groups. The SDD Core Change Request 2012 offers the recommendations of the EPC SEPA Payment Schemes Working Group (SPS WG) on the way forward with regard to individual suggestions. An overview of the suggestions for changes and related recommendations by the SPS WG is provided on pages 5 through 8 of this Change Request. The EPC submits the SDD Core Change Request 2012 for public consultation. The 2012 public consultation takes place between 16 May and 13 August All stakeholders are encouraged to provide feedback on the possible changes to be introduced into the next version of the SDD Core Rulebook. To share your feedback on this Change Request, please complete the online questionnaire posted at Please send your response by 13 August Should you encounter any technical difficulties in accessing or completing this questionnaire, please contact the EPC Secretariat at secretariat@epc-cep.eu. Proposed changes detailed in this SDD Change Request 2012, which are broadly accepted by all stakeholders, are taken forward. The updated version of the SDD Rulebook will be published in November In accordance with industry best practice, payment service providers and their suppliers have a one-year lead time to address rulebook updates prior to such updates taking effect. The following general background information is made available for further information: Extract SEPA Scheme Management Internal Rules (section 3: development and evolution). EPC Newsletter: EPC Scheme Change Management: Annual Public Consultation Starts in May 2012 (Issue 14, April 2012). It should be noted that the EPC s analysis of the SEPA Regulation and its impact on the EPC Rulebooks is continuing. The EPC therefore reserves the right to make the necessary changes to the schemes (in addition to those described in chapter 3) in order to ensure compliance with this Regulation. Please refer to Annex I for the original detailed suggestions for changes. This document contains only a summary of each individual suggestion. Conseil Européen des Paiements AISBL Av. de Tervueren 12 B 1040 Brussels Tel: Fax: Enterprise N secretariat@epc-cep.eu

2 Version 1.0 of this document was originally published on 16 May The changes in this version 1.1 compared to version 1.0 include the following: the addition in Annex I of detailed wording suggestions made by the EPC Legal Support Group concerning the changes pertaining to the impact of Regulation 260/2012, as summarized in section 3 of this document and as a result of the EPC Plenary having withdrawn the EPC criteria for participation in SEPA (for non-eea countries or territories) in March 2012 correction of terminology in section where it is now referred to Debtor and Creditor Bank instead of Originator and Beneficiary Bank EPC SDD Core Change Request

3 TABLE OF CONTENTS 1 Executive Summary: Suggestions for Major Changes to the SEPA direct debit Core Rulebook Summary of suggestions for changes and proposed way forward for consideration by respondents to this public consultation Detailed Analysis of Suggestions for Major Changes to the SDD core Rulebook Clarification on sequence verification Shorter time cycle Inclusion of new reject codes No refund option Mandate digitization Inclusion of new reason code in AT-R Deletion of the usage rule of AT Clarification of Refund reason codes Allowing electronic mandate / signature Notification to creditor in case of change in debtor s details Notification to creditor in case of change of debtor banking details The use of International Bank Account Number (IBAN) only procedure on mandates The use of Basic Bank Account Number (BBAN) and national sorting code instead of IBAN on the mandate Clarification on mandate guidelines Allowing longer remittance information Waiving of the obligation to issue a pre-notification Description Unique Mandate Reference to be space insensitive Clarification on the use of AT-21 transaction type Clarification on one-off collections Pre-notification for one-off collections Name of debtor to be optional Address of Debtor to be optional BIC code of debtor bank to be optional Addition of new process step for re-presentation Inclusion of the possibility of a shorter notice period for the termination of participation Notices given under the Rulebook Changes pertaining to the impact of the sepa regulation (regulation (eu) no 260/2012) Common legal framework Definition of a payment scheme IBAN only Validity of legacy mandates Interchange Fees Changes to the Rulebook for clarification, updating and correction of errors Introduction Proposed changes principles governing the Change Request Process Change Request Structure of the Change Request Change management process in respect of Major Changes EPC SDD Core Change Request

4 6.1 Consideration of Suggestions Change Request Cost-benefit analysis and business case for the Change Request Consultation on the Change Request Feedback from consultation Next steps SPS WG recommendation Further information Change management process in respect of Minor Changes Publication of list of minor changes Comments on the minor changes Submission of the list of minor changes to the EPC Plenary Publication of changes Annex 1 - Original Change Requests EPC SDD Core Change Request

5 1 EXECUTIVE SUMMARY: SUGGESTIONS FOR MAJOR CHANGES TO THE SEPA DIRECT DEBIT CORE RULEBOOK The principles governing the evolution of the Single Euro Payments Area (SEPA) payment schemes as set out in the SEPA Credit Transfer (SCT) and SEPA Direct Debit (SDD) Rulebooks are detailed in the SEPA Scheme Management Internal Rules (the Internal Rules). These Internal Rules are available for download on the European Payments Council (EPC) Website. Chapters 5, 6 and 7 in this SDD Core Change Request 2012 document detail the application of the Internal Rules in the annual EPC scheme change management process. The Internal Rules differentiate between so called major and minor changes to the scheme rulebooks. A major change is a change that affects or proposes to alter the substance of the rulebooks and the schemes. Any change to chapters 5 and 6 of the rulebooks are always considered a major change. A minor change is a change of an uncontroversial and usually technical nature that facilitates the comprehension and use of the rulebooks. This executive summary of the SDD Core Change Request 2012 highlights suggestions for major changes to the SDD Core Rulebook received in the 2012 scheme change management cycle. Suggestions for minor changes to the SDD Core Rulebook are set out in chapter 4 of this Change Request. All suggestions for changes to the SDD Core Rulebook are submitted for public consultation between 16 May and 13 August Information on how to share feedback with the EPC is included on the cover page of this Change Request. The EPC received 32 suggestions for major changes to be introduced into the SDD Core Rulebook. Five additional suggestions for changes reflect the need to align the SDD Core Rulebook with the Regulation (EU) No 260/2012 establishing technical and business requirements for credit transfers and direct debits in euro and amending Regulation (EC) No 924/2009' (the SEPA Regulation), which was adopted by the European Union legislator in February It should be noted that the EPC s analysis of the SEPA Regulation and its impact on the EPC Rulebooks is continuing. The EPC therefore reserves the right to make the necessary changes to the schemes (in addition to those described in chapter 3) in order to ensure compliance with this Regulation. All suggestions for changes to the SDD Core Rulebook received were reviewed by the EPC SEPA Payment Schemes Working Group (SPS WG). This Change Request includes the recommendation of the SPS WG with regard to each of these suggestions. Each recommendation reflects one of the options detailed in items a) through f) below: a) The suggestion for change is already provided for in the scheme. No action is necessary for the EPC. b) The suggestion for change should be incorporated into the scheme. The suggestion for change becomes part of the scheme and the rulebook is amended accordingly. c) The suggestion for change should be included in the scheme as an optional feature. The new feature is optional and the rulebook will be amended accordingly. Each scheme participant 1 may decide to offer the feature to its customers, or not. d) The suggestion for change is not considered fit for SEPA wide use and could be handled as an additional optional service (AOS) by interested communities. 1 A scheme participant is a payment service provider which has formally adhered to a SEPA Scheme. EPC SDD Core Change Request

6 The proposed new feature is not included in the rulebook or in the implementation guidelines released by the EPC with regard to the rulebooks. The development of AOS is out of scope of the EPC. The EPC does however publish declared AOS arrangements on its website for information. The EPC may consider the inclusion of AOS arrangements, if supported by a sufficient number of communities, in a future version of the rulebook. e) The suggestion for change cannot be part of the existing scheme. It is technically impossible. It is not feasible (explained on a case by case basis). It is out of scope of the EPC. f) The suggestion for change may be considered for the development of a new scheme. The suggestion reflects major changes which cannot be integrated into an existing scheme. To develop the suggestion for change further, i.e. to develop a new scheme, the following requirements should be met: The benefits of the new scheme for bank customers are demonstrated prior to the launch of the development phase. It is demonstrated that a sufficient number of stakeholders will make use of the new scheme. A cost-benefit analysis is provided. 1.1 Summary of suggestions for changes and proposed way forward for consideration by respondents to this public consultation The below table lists all the suggestions for change received which are submitted for public consultation. The SPS WG has issued a recommendation on the way forward with regard to each suggestion; the reasons underlying each recommendation are detailed in chapter 2. The final decision whether a suggested change will be incorporated into the rulebook is however subject to the outcome of the public consultation. The contributors to this public consultation are requested to indicate whether they agree with the recommendation of the SPS WG on the way forward. In case the contributors do not agree with the SPS WG recommendation, they are requested to indicate their preferred way forward. Ref. Topic Contributor Recommendation of the SPS WG on the proposed way forward. The final decision is subject to the outcome of the public consultation. 2.1 Clarification on sequence verification Cedacri Spa Not a change request but a question for clarification will be clarified in FAQ document 2.2 Shorter time cycle Austrian Payments Council,, InterCard, Handelsverband Deutschland, easycash, TeleCash & BP Europa The suggestion cannot be part of the existing scheme option e EPC SDD Core Change Request

7 Ref. Topic Contributor Recommendation of the SPS WG on the proposed way forward. The final decision is subject to the outcome of the public consultation. 2.3 Inclusion of new reject codes French banking community 2.4 No refund option Dutch banking community 2.5 Mandate digitization Dutch banking community, Bitkom Should be incorporated into the scheme option b The suggestion cannot be part of the existing scheme option e Already provided for in the scheme option a 2.6 Inclusion of new reason code in AT-R3 Dutch banking community Already provided for in the scheme option a 2.7 Deletion of usage rule of AT-10 Spanish banking community The suggestion cannot be part of the existing scheme option e 2.8 Clarification of refund reason codes 2.9 Allowing electronic mandate / signature 2.10 Notification to creditor in case of change in debtor s details 2.11 Notification to creditor in case of change of debtor banking details 2.12 The use of International Bank Account Number (IBAN) only procedure on mandates 2.13 The use of Basic Bank Account Number (BBAN) and national sorting code instead of IBAN on the mandate 2.14 Clarification on mandate guidelines Spanish banking community Bitkom, InterCard, Handelsverband Deutschland, easycash, TeleCash & BP Europa Bitkom Bitkom Bitkom Bitkom Bitkom Should be incorporated into the scheme option b Already provided for in the scheme option a The suggestion cannot be part of the existing scheme as it is out of scope of the EPC option e The suggestion cannot be part of the existing scheme as it is out of scope of the EPC option e Should be incorporated into the scheme option b The suggestion cannot be part of the existing scheme as it is out of scope of the EPC option e The suggestion cannot be part of the existing scheme option e EPC SDD Core Change Request

8 Ref. Topic Contributor Recommendation of the SPS WG on the proposed way forward. The final decision is subject to the outcome of the public consultation Allowing longer remittance information 2.16 Waiving of the obligation to issue a pre-notification 2.17 Unique mandate reference (UMR) to be space insensitive 2.18 Clarification on the use of AT-21 transaction type 2.19 Clarification on one-off collections 2.20 Pre-notification for one-off collection Bitkom, InterCard, Handelsverband Deutschland, easycash, TeleCash & BP Europa Bitkom Bitkom Bitkom Bitkom InterCard, Handelsverband Deutschland, easycash, TeleCash & BP Europa The suggestion cannot be part of the existing scheme option e The suggestion cannot be part of the existing scheme option e The suggestion cannot be part of the existing scheme option e Not a change request but a question for clarification will be clarified in FAQ document Not a change request but a question for clarification will be clarified in FAQ document Already provided for in the scheme option a 2.21 Name of debtor to be optional InterCard, Handelsverband Deutschland, easycash, TeleCash & BP Europa 2.22 Address of debtor to be optional InterCard, Handelsverband Deutschland, easycash, TeleCash & BP Europa Further analysis must be undertaken in order to assess the impact of the requirements of the SEPA Regulation on the existing scheme The contributors to this public consultation are invited to comment on this suggestion Further analysis must be undertaken in order to assess the impact of the requirements of the SEPA Regulation on the existing scheme The contributors to this public consultation are invited to comment on this suggestion EPC SDD Core Change Request

9 Ref. Topic Contributor Recommendation of the SPS WG on the proposed way forward. The final decision is subject to the outcome of the public consultation BIC code of debtor bank to be optional 2.24 Addition of new process step for re-presentation 2.25 Inclusion of the possibility of a shorter notice period for the termination of participation InterCard, Handelsverband Deutschland, easycash, TeleCash & BP Europa InterCard, Handelsverband Deutschland, easycash, TeleCash & BP Europa LSG Should be incorporated into the scheme option b The suggestion cannot be part of the existing scheme option e Should be incorporated into the scheme option b 2.26 Notices given under the rulebook LSG The suggestion cannot be part of the existing scheme option e EPC SDD Core Change Request

10 Summary of changes which will be included in the next version of the SDD Core Rulebook to align the rulebook with Regulation 260/2012. The contributors to this public consultation are welcome to comment on these changes. 3.1 Common legal framework: in line with Article 1(1) of the SEPA Regulation, it is proposed to add a new section to all rulebooks to make reference to the common legal framework for the SCT and SDD Schemes. 3.2 Definition of a payment scheme: in line with Article 2(7) of the SEPA Regulation, it is proposed that wording be added to section 1.1 of all rulebooks to state that the SCT and SDD Schemes are schemes in the sense of this Article. 3.3 Alignment of the rulebooks and implementation guidelines with provisions in the SEPA Regulation concerning the use of the International Bank Account Number (IBAN) and the Business Identifier Code (BIC) in line with Articles 5(1), 5(2), 5(4) and 5(7) of the SEPA Regulation ( IBAN only rule) 3.4 Alignment of the rulebooks with the provisions of the SEPA Regulation concerning the validity of legacy mandates in line with Article Alignment of the rulebooks with the provisions of the SEPA Regulation concerning interchange fees in line with Article 8 SPS WG & LSG SPS WG & LSG SPS WG & LSG SPS WG & LSG SPS WG & LSG Should be incorporated into the scheme option b Should be incorporated into the scheme option b Should be incorporated into the scheme option b Should be incorporated into the scheme option b Should be incorporated into the scheme option b EPC SDD Core Change Request

11 2 DETAILED ANALYSIS OF SUGGESTIONS FOR MAJOR CHANGES TO THE SDD CORE RULEBOOK 2.1 Clarification on sequence verification Description This suggestion was made by Cedacri Spa, Italy. It is suggested to clarify if the sequence of the collection must be verified in accordance with collections previously received under the same mandate and if the abnormal sequence of a collection must be understood as a reason for rejecting or returning the collection SPS WG analysis and recommendation It is up to the debtor bank to decide on the checking of the sequence and on whether the incorrect sequence type should be treated as a reason for rejection or returning. The SPS WG considers this as a request for clarification rather than a change suggestion and it is included in this document for the sake of completeness. It is proposed to add this clarification in a Frequently Asked Questions (FAQ) document which will be published on the EPC website. EPC SDD Core Change Request

12 2.2 Shorter time cycle Description The Austrian Payments Council proposed to implement the optional D-1 as the standard time cycle for all transactions instead of D-5 (for first and one-off collections) and D-2 (for recurrent collections). A similar suggestion was made by a group of German stakeholders (InterCard, Handelsverband Deutschland, easycash, TeleCash and BP Europa) which proposed using a D-1 or D-2 time cycle and making AT-21 (transactions type) optional SPS WG analysis and recommendation The SPS WG considers that this suggestion cannot be part of the existing scheme as at this point in time it is considered that it is too early to make such a change (option e). The SPS WG recognises that a shorter time cycle as requested by the Austrian Payments Council, InterCard, Handelsverband Deutschland, easycash, TeleCash and BP Europa reflects existing practice in Austria and Germany. The EPC must however ensure that the scheme rules reflect the needs of a broad majority of stakeholders in all 32 SEPA countries. Migration to the SDD Core Scheme requires all SEPA communities to adjust to a new standard time cycle for direct debit collections. The current scheme rules respond to the needs of the broad majority of all stakeholders in the 32 SEPA countries as identified with previous public consultations. To cater to the specific needs of the Austrian community and some German stakeholders, the optional shorter time cycle was introduced into the SDD Core Scheme Rulebook. The SPS WG recommends considering, in close dialogue with all stakeholders, at a stage following migration whether a shorter standard time cycle would be supported by a broad majority of all stakeholders. According to section of the Internal Rules, the following criteria have been evaluated: Does the change present a case for wide SEPA market acceptance? Is the change underpinned by a cost-benefit analysis? Is the change feasible to implement? Based on feedback received from a broad majority of all SEPA stakeholders in previous public consultations, this change does not present a case for wide SEPA market acceptance at this stage. No. Implementing such a significant change at this stage would have a substantial impact on a majority of SEPA stakeholders who to date indicated a preference for the current scheme rules. It would also require SEPA stakeholders which already migrated to SDD Core to reinvest into further adaptation of systems and operations Rulebook Impact Subject to outcome of the public consultation: if a broad majority of all SEPA stakeholders would support this suggestion for change, this would have a significant impact on the rulebook. EPC SDD Core Change Request

13 2.3 Inclusion of new reject codes Description This suggestion was made by the French banking community. They propose making rejects possible because either the destination bank or the originator bank is not registered within the clearing and settlement (CSM) reference data. The French banks propose to add two new reasons ( Creditor Bank not registered under this BIC in the CSM and Debtor Bank not registered under this BIC in the CSM ) SPS WG analysis and recommendation The SPS WG recommends that the suggestion be incorporated into the scheme and the reason codes added to the rulebook and implementation guidelines (IGs) (option b). According to section of the Internal Rules, the following criteria have been evaluated: Does the change present a case for wide SEPA market acceptance? Is the change underpinned by a cost-benefit analysis? Is the change feasible to implement? Yes. No. Yes; only a minor impact on rulebook and IGs Rulebook Impact This change will impact both the rulebook and the IGs as new reason codes must be added. EPC SDD Core Change Request

14 2.4 No refund option Description This suggestion was made by the Dutch banking community. The suggestion is to add an option in the rulebook for non-refundable transactions SPS WG analysis and recommendation The SPS WG considers that this suggestion cannot be part of the existing scheme (option e). The direct debit mandate is the key element for the entire scheme. Any legal change in the nature of a mandate and the scheme should result in a separate scheme. The SPS WG recognises that an option for non-refundable direct debits as requested by the Dutch banking community reflects existing practice in the Netherlands. The EPC must however ensure that the scheme rules reflect the needs of a broad majority of stakeholders in all 32 SEPA countries. The current scheme rules responds to the needs of the broad majority of all stakeholders in the 32 SEPA countries as identified with previous public consultations. However, in order to respond to this request, it is proposed to reactivate the work on the SDD Fixed Amount (FA) Rulebook. The SEPA Regulation covers the legal and consumer protection issues linked to a no-refund scheme. According to section of the Internal Rules, the following criteria have been evaluated: Does the change present a case for wide SEPA market acceptance? Is the change underpinned by a cost-benefit analysis? Is the change feasible to implement? Based on feedback received from a broad majority of all SEPA stakeholders in previous public consultations, this change does not present a case for wide SEPA market acceptance at this stage. No. Implementing such a significant change at this stage would have a substantial impact on a majority of SEPA stakeholders who to date indicated a preference for the current scheme rules Rulebook Impact Subject to outcome of the public consultation: if a broad majority of all SEPA stakeholders would support this suggestion for change, this would have a significant impact on the rulebook. EPC SDD Core Change Request

15 2.5 Mandate digitization Description Two similar suggestions concerning mandate digitalization were presented both by the Dutch banking community and by Bitkom, Germany. The Dutch banking community proposed to add a clarification in the rulebooks to state that if a correct SEPA-mandate is digitized according to the legal requirements and conditions, a copy must be considered valid by the debtor banks e.g. for investigation of unauthorised transactions. The proposal of Bitkom requested that the obligation to store the original mandate and its changes (in paper format) should be avoided and that an audit-proofed archiving of the digitalized mandates and the digitalized mandate changes should be enough SPS WG analysis and recommendation The SPS WG considers that this issue is already covered in the rulebooks (section 4.1) where it is stated that mandates must be stored according to the requirements of national legislation (option a). It cannot be stated in the rulebooks that digitalised mandates must always be accepted by debtor banks as national legislations differ in this regard within SEPA countries. According to section of the Internal Rules, the following criteria have been evaluated: Does the change present a case for wide SEPA market acceptance? Is the change underpinned by a cost-benefit analysis? Is the change feasible to implement? N/A already provided for in the Scheme.. N/A already provided for in the Scheme.. N/A already provided for in the Scheme Rulebook Impact N/A as suggestion is already covered in the rulebook to the extent possible. EPC SDD Core Change Request

16 2.6 Inclusion of new reason code in AT-R Description This suggestion was made by the Dutch banking community. It is proposed to add new reason code: transaction type incorrect in AT-R SPS WG analysis and recommendation The SPS WG considers that this suggestion is already provided for in the scheme (option a). There is already a reason code for this in the Rulebooks as AT-R3 includes the reason code Operation/transaction code incorrect, invalid File format. It is however proposed to enhance the AT-R3 reason code description Operation/transaction code incorrect, invalid File format to Operation/transaction/sequence type code incorrect, invalid File format in order to cover in the wording the issue of a wrong sequence type (this applies also for the suggestion described in section 2.17). In order to make a differentiation between incorrect transaction or sequence type code and invalid file format, a change to the International Standardization Organisation (ISO) external code list is required. According to section of the Internal Rules, the following criteria have been evaluated: Does the change present a case for wide SEPA market acceptance? Is the change underpinned by a cost-benefit analysis? Is the change feasible to implement? N/A already included in the Rulebook. N/A already included in the Rulebook. N/A already included in the Rulebook Rulebook Impact Only a minor wording addition in the rulebook. EPC SDD Core Change Request

17 2.7 Deletion of the usage rule of AT Description This suggestion was made by the Spanish banking community. The suggestion is to delete the usage rule of AT-10 (the creditor s reference of the direct debit collection ) in the interbank IGs SPS WG analysis and recommendation The SPS WG considers that this suggestion cannot be part of the existing scheme as the field is mandatory in the ISO20022 standard developed by ISO (option e). For more information, refer to the ISO website ( Therefore, the creditor bank has to provide this field in the inter-bank message even if no reference was received from the creditor. Banks offering an SDD initiation service in a non-iso environment should mandate the creditor to provide this reference. According to section of the Internal Rules, the following criteria have been evaluated: Does the change present a case for wide SEPA market acceptance? Is the change underpinned by a cost-benefit analysis? Is the change feasible to implement? No. No. No. The EPC IGs are a subset of the global ISO message standards. The EPC is not in a position to unilaterally change fields which are mandatory in the ISO standard Rulebook Impact N/A. EPC SDD Core Change Request

18 2.8 Clarification of Refund reason codes Description This request was made by the Spanish banking community. The request is to clarify reasons for a refund of AT-R3. It appears that the reason disputed authorised transaction could be used after the eight-week period: PT ( CSM sends the Instruction for a Refund of an Unauthorised Transaction to the Creditor Bank ) makes reference to DS-05, where AT-R3 (the reason code for non-acceptance of the collection) is cited. However, AT-R3 makes reference to both reasons - authorised and non-authorised transactions SPS WG analysis and recommendation The SPS WG recommends that this suggestion be incorporated into the scheme and wording added to the rulebook to clarify that reason disputed authorised transaction can only be used within the eight-weeks-no-questions-asked refund period (option b). According to section of the Internal Rules, the following criteria have been evaluated: Does the change present a case for wide SEPA market acceptance? Is the change underpinned by a cost-benefit analysis? Is the change feasible to implement? Yes. No. Yes Rulebook Impact The impact on the rulebook is limited as this is only a wording clarification. EPC SDD Core Change Request

19 2.9 Allowing electronic mandate / signature Description This suggestion was made by Bitkom, Germany. It is proposed that in future electronic mandates with electronic signatures should be permitted based on: The qualified electronic signature. The authentication via the new identity card without qualified electronic signature. The signature with the help of a signature pad. Via the Double-Opt-In-Procedure. A similar request was made jointly by InterCard, Handelsverband Deutschland, easycash, TeleCash & BP Europa (Germany) SPS WG analysis and recommendation The SPS WG considers that this suggestion is already provided for in the scheme as the rulebook already allows the use of electronic signatures (option a). It is proposed however to add electronic signature in the glossary to clarify that electronic signatures must be legally valid (a qualified electronic signature). According to section of the Internal Rules, the following criteria have been evaluated: Does the change present a case for wide SEPA market acceptance? Is the change underpinned by a cost-benefit analysis? Is the change feasible to implement? N/A already included in the Rulebook. N/A already included in the Rulebook. N/A already included in the Rulebook Rulebook Impact N/A as this is already allowed in the rulebook. EPC SDD Core Change Request

20 2.10 Notification to creditor in case of change in debtor s details Description This suggestion was made by Bitkom, Germany. The suggestion is that changes of mandate by the debtor should be communicated by the debtor via: a) Mail. b) Fax. c) Internet. d) Telephone SPS WG analysis and recommendation The SPS WG considers that this suggestion cannot be part of the existing scheme as this issue is out of scope of the rulebook and the EPC (option e). Any communication between the debtor and the creditor can be done in a manner agreed between the parties bilaterally according to the rules stated in the SDD Core Rulebook section 4.1; the EPC is not authorised to mandate the form in which this communication takes place. According to section of the Internal Rules, the following criteria have been evaluated: Does the change present a case for wide SEPA market acceptance? Is the change underpinned by a cost-benefit analysis? Is the change feasible to implement? N/A out of scope of the rulebook. No. N/A out of scope of the rulebook Rulebook Impact N/A as the suggestion is out of scope of the rulebook. EPC SDD Core Change Request

21 2.11 Notification to creditor in case of change of debtor banking details Description This suggestion was made by Bitkom, Germany. It is suggested that changes of the banking details by the debtor should be communicated via a) Mail. b) Fax. c) Internet. d) Telephone. In the case of d, sending a written acknowledgement by the creditor should be enough as evidence SPS WG analysis and recommendation The SPS WG considers that this suggestion cannot be part of the existing scheme as this issue is out of scope of the rulebook and the EPC (option e). Any communication between the debtor and the creditor can be done in a manner agreed between the parties bilaterally according to the rules stated in the SDD Core Rulebook section 4.1; the EPC is not authorised to mandate the form in which this communication takes place. According to section of the Internal Rules, the following criteria have been evaluated: Does the change present a case for wide SEPA market acceptance? Is the change underpinned by a cost-benefit analysis? Is the change feasible to implement? N/A out of scope of the rulebook. No. N/A out of scope of the rulebook Rulebook Impact N/A as the suggestion is out of scope of the rulebook. EPC SDD Core Change Request

22 2.12 The use of International Bank Account Number (IBAN) only procedure on mandates Description This suggestion was made by Bitkom, Germany. It is proposed that the requirements for the mandate should consider the IBAN-only procedure. For national accounts it should not be necessary to provide the BIC on the mandate SPS WG analysis and recommendation The SPS WG proposes to incorporate this suggestion into the scheme (option b) as according to the SEPA Regulation, after 1 February 2014, the BIC will become in principle optional in the customerto-bank IGs for national payments, therefore it will become optional on the mandate as well. The BIC will be necessary until 1 February 2016 for cross-border transactions as stipulated in Article 5 of the SEPA Regulation. However, it is expected that the debtor always has its BIC at the time of the signature of the mandate. Possible national transitional rules according to the SEPA Regulation regarding the requirement of the BIC for national payments have to be respected. According to section of the Internal Rules, the following criteria have been evaluated: Does the change present a case for wide SEPA market acceptance? Is the change underpinned by a cost-benefit analysis? Is the change feasible to implement? Yes. This is a change required by the SEPA Regulation. Yes Rulebook Impact The impact on the rulebook is limited as this change will require the change of an element from mandatory to optional. EPC SDD Core Change Request

23 2.13 The use of Basic Bank Account Number (BBAN) and national sorting code instead of IBAN on the mandate Description This suggestion was submitted by Bitkom, Germany. It is proposed that if it is allowed by national legislation to provide the account number and national sorting code instead of the IBAN for national payments until 1st February 2016, it should also be allowed to use the account number and the national sorting code instead of the IBAN to issue a mandate SPS WG analysis and recommendation The SPS WG considers that this suggestion cannot be part of the existing scheme as it is out of scope of the EPC (option e). According to the SEPA Regulation, the initiation of direct debits with a BBAN is only allowed for consumers. According to section of the Internal Rules, the following criteria have been evaluated: Does the change present a case for wide SEPA market acceptance? Is the change underpinned by a cost-benefit analysis? Is the change feasible to implement? Subject to the number of EU Member States which will opt to make use of the derogation permissible under Article 16 (1) of the SEPA Regulation. The market will have more clarity by 1 February 2013, by which time EU Member States must notify the European Commission of the derogations that they intend to use (see Article 16 (7). No. Implementing such a significant change at this stage would have a substantial impact on a majority of SEPA stakeholders who to date indicated a preference for the current scheme rules Rulebook Impact Subject to outcome of the public consultation: if a broad majority of all SEPA stakeholders would support this suggestion for change, this would have a significant impact on the rulebook. EPC SDD Core Change Request

24 2.14 Clarification on mandate guidelines Description This suggestion was submitted by Bitkom, Germany. According to Bitkom, the DK (Deutsche Kreditwirtschaft) mandate samples are not in accordance with formal regulations of the EPC rulebook: The compliance with the order of the mandate information. The obligation to indicate the specified identifier (field names). The obligation to specify a statement to the payee for the mandate return. The clear separation of the mandate from any other text. The request is to no longer consider the above as mandatory guidelines for a mandate. They should be considered more as non-binding recommendations for the issue of a mandate SPS WG analysis and recommendation The SPS WG considers that this suggestion is already covered by the scheme as the sample of a physical mandate in the rulebooks is only an illustration (option a). More detailed information can be found in document EPC Guidelines for the Appearance of Mandates available on the EPC website. The recommendation is to incorporate a clarification in the rulebook. According to section of the Internal Rules, the following criteria have been evaluated: Does the change present a case for wide SEPA market acceptance? Is the change underpinned by a cost-benefit analysis? Is the change feasible to implement? N/A already provided for in the scheme. N/A already provided for in the scheme N/A already provided for in the scheme Rulebook Impact The impact on the rulebook is minor as only a wording clarification needs to be done. EPC SDD Core Change Request

25 2.15 Allowing longer remittance information Description Suggestions for allowing longer remittance information were submitted by Bitkom and jointly by InterCard, Handelsverband Deutschland, easycash, TeleCash & BP Europa (Germany) SPS WG analysis and recommendation The SPS WG recommends not taking forward this suggestion for change at this point as it is not feasible to incorporate this change into the scheme at this stage in the migration process (option e). It should be kept in mind that all market participants in the euro area are required to meet the 1 February 2014 deadline for compliance with the SEPA Regulation; i.e. systems and operations have already been aligned or are being aligned with, among other things, the current standard 140 character remittance information. Introducing such a significant change at this stage would require all market participants (i.e. payers, payees, PSPs, payment service users and CSMs) to make further significant investments into their IT systems, rendering previous developments obsolete Experience shows that over 95 percent of credit transfers can be validly reconciled with less than 140 characters of remittance information. It is standard practice throughout Europe and in many other parts of the world for all processing chains to allow for 140 characters in the remittance data field. Allowing for 1000 characters in SEPA would force European PSPs and corporates to maintain different processing applications and IT systems for SEPA and non-sepa transactions. The remittance information should be kept at 140 characters, in order to ensure full remittance information end-to-end through the different account information channels for mass payments. The EPC would welcome to discuss with all stakeholders any other need going further based on an impact and cost-benefit analysis. According to section of the Internal Rules, the following criteria have been evaluated: Does the change present a case for wide SEPA market acceptance? Is the change underpinned by a cost-benefit analysis? Is the change feasible to implement? Based on feedback received from a broad majority of all SEPA stakeholders in previous public consultations, this change does not present a case for wide SEPA market acceptance at this stage. No. Implementing such a significant change at this stage would have a substantial impact on a majority of SEPA stakeholders who to date indicated a preference for the current scheme rules. It would also require SEPA stakeholders which already migrated to SDD Core to reinvest into further adaptation of systems and operations Rulebook Impact Subject to outcome of the public consultation: if a broad majority of all SEPA stakeholders would support this suggestion for change, this would have a significant impact on the rulebook. EPC SDD Core Change Request

26 2.16 Waiving of the obligation to issue a pre-notification Description This suggestion was made by Bitkom, Germany. It is proposed to waive the pre-notification in the scope of an AOS or eliminating the specification of an exact amount in the pre-notification concerning certain transactions SPS WG analysis and recommendation The SPS WG considers that this suggestion cannot be part of the existing scheme (option e). The EPC defines the pre-notification as an instrument for consumer protection and to enable the debtor to provide the exact amount of cover on the defined due date. It is the interest of the creditor that the direct debit can be successfully collected on due date and therefore the debtor must know the date and the amount of the collection in advance. The pre-notification does not need to be an additional document as invoices and contracts already showing the amounts and due dates can be considered as pre-notifications. The SPS WG however proposes to add a clarification on the use of the pre-notification in the rulebook. According to section of the Internal Rules, the following criteria have been evaluated: Does the change present a case for wide SEPA market acceptance? No. Is the change underpinned by a cost-benefit analysis? Is the change feasible to implement? No. Implementing such a significant change at this stage would have a substantial impact on a majority of SEPA stakeholders who to date indicated a preference for the current scheme rules. It would also require SEPA stakeholders which already migrated to SDD Core to reinvest into further adaptation of systems and operations Rulebook Impact Subject to outcome of the public consultation: if a broad majority of all SEPA stakeholders would support this suggestion for change, this would have a significant impact on the rulebook. EPC SDD Core Change Request

27 2.17 Unique Mandate Reference to be space insensitive Description This suggestion was made by Bitkom, Germany. They propose that spaces in the unique mandate reference (UMR) (AT-01) should not be considered SPS WG analysis and recommendation The SPS WG recommends that this suggestion cannot be part of the existing scheme as it is not feasible (option e). Spaces are permitted in the UMR and are considered as meaningful characters. Therefore not taking the blanks into account would mean creating a different UMR than the original one. According to section of the Internal Rules, the following criteria have been evaluated: Does the change present a case for wide SEPA market acceptance? No. Is the change underpinned by a cost-benefit analysis? Is the change feasible to implement? No. No, implementing such a change would have a significant impact as this would not be in line with the way UMRs are currently handled Rulebook Impact Subject to outcome of the public consultation: if a broad majority of all SEPA stakeholders would support this suggestion for change, this would have a significant impact on the rulebook. EPC SDD Core Change Request

28 2.18 Clarification on the use of AT-21 transaction type Description Bitkom submitted several processing-related questions concerning the use of AT-21 transaction type (see original change suggestion EPC in the Annex for more details) SPS WG analysis and recommendation. The SPS WG considers that this request is not a change request but rather a clarification issue. It is included in this document for sake of completeness. Answer to it will be included in the FAQ document. The SPS WG however recommends that AT-21 should be called transaction or sequence type. EPC SDD Core Change Request

29 2.19. Clarification on one-off collections Description Bitkom submitted several operational questions linked to one-off collections (please see Annex I for further details) SPS WG analysis and recommendation. The SPS WG considers that this request is not a change request but rather a clarification issue. It is included in this document for sake of completeness. A clarification will be included in the FAQ document. EPC SDD Core Change Request

30 2.20 Pre-notification for one-off collections Description This suggestion was made by InterCard, Handelsverband Deutschland, easycash, TeleCash & BP Europa (Germany). It is proposed that if the due-date is announced in the context of the mandate for a one-off collection, the pre-notification step can be omitted SPS WG analysis and recommendation. The SPS WG considers that this suggestion is already part of the rulebook (option a). The mandate does not contain the due date, but when e.g. a contract or an invoice contains the due date, the contract or invoice can be considered as pre-notification. According to section of the Internal Rules, the following criteria have been evaluated: Does the change present a case for wide SEPA market acceptance? N/A - already included in the rulebook. Is the change underpinned by a cost-benefit analysis? Is the change feasible to implement? N/A - already included in the rulebook. N/A - already included in the rulebook Rulebook Impact N/A as already part of the rulebook. EPC SDD Core Change Request

31 2.21 Name of debtor to be optional Description This suggestion was made jointly by InterCard, Handelsverband Deutschland, easycash, TeleCash & BP Europa. It is suggested to change AT-14 (name of the debtor) from mandatory to optional SPS WG analysis and recommendation. Further analysis must be undertaken in order to assess the impact of the requirements of the SEPA Regulation on the existing scheme. According to section of the Internal Rules, the following criteria have been evaluated: Does the change present a case for wide SEPA market acceptance? Is the change underpinned by a cost-benefit analysis? Is the change feasible to implement? Rulebook Impact N/A EPC SDD Core Change Request

32 2.22 Address of Debtor to be optional Description This suggestion was made jointly by InterCard, Handelsverband Deutschland, easycash, TeleCash & BP Europa. It is suggested to change AT-09 (address of the debtor) from mandatory to optional SPS WG analysis and recommendation. Further analysis must be undertaken in order to assess the impact of the requirements of the SEPA Regulation on the existing scheme. According to section of the Internal Rules, the following criteria have been evaluated: Does the change present a case for wide SEPA market acceptance? Is the change underpinned by a cost-benefit analysis? Is the change feasible to implement? Rulebook Impact N/A EPC SDD Core Change Request

33 2.23 BIC code of debtor bank to be optional Description This suggestion was jointly made by InterCard, Handelsverband Deutschland, easycash, TeleCash & BP Europa. It is proposed to change AT-13 (BIC code of debtor dank) from mandatory to optional in DS-01, DS-02 and DS SPS WG analysis and recommendation. The SPS WG proposes to incorporate this suggestion into the scheme (option b) as according to the SEPA Regulation, after 1 February 2014, the BIC will become optional in the customer-to-bank IGs for national payments, therefore it will be made optional on the mandate as well. However, it is expected that the debtors will provide its BIC at the time of the signature of the mandate. Possible national transitional rules according to the SEPA regulation regarding the requirement of the BIC for national payments have to be respected. According to section of the Internal Rules, the following criteria have been evaluated: Does the change present a case for wide SEPA market acceptance? Yes. Is the change underpinned by a cost-benefit analysis? Is the change feasible to implement? No. Yes Rulebook Impact The impact on the rulebook is minor as a data element needs to be changes from mandatory to optional. EPC SDD Core Change Request