Commissioner Jonathan Hill 32 Smith Square, London SW1P 3EU
Dear Commissioner Hill,
We are writing this open letter to you as NGOs, civil society organisations, campaigners and EU citizens to call on you to amend the proposed rules for addressing excessive price speculation on food and other commodities in financial markets.
When the EU legislation - Markets in Financial Instruments Directive II (MiFID II) - was agreed in January 2014, the European Commission claimed that it would be "curbing speculation on commodities and the disastrous impacts it can have on the world's poorest populations.”
However, we are alarmed that the proposed rules for implementation will severely weaken the effectiveness of the legislation and will not tackle excessive speculation on food and other commodities.
High and volatile food prices have had a devastating impact in poor and food dependent countries, causing increased hunger, poverty and instability. They also affect agricultural producers as well as consumers in the EU and around the world. Strict limits need to be set consistently throughout the EU on the amount that companies and persons can bet on commodity prices in order to curb harmful speculation.
However, the proposals to implement MiFID II that you are considering will allow weak and ineffective position limit systems in member states. They will also leave the EU unable to deliver on its commitments by the G20 leaders, G20 Finance Ministers and G20 Agriculture Ministers. The EU agreed to improve the regulation of financial commodity markets to address excessive price volatility as an important step to reduce poverty, achieve food security, budget stability and strong growth that is both sustainable and inclusive including setting up a robust position limits system.
Hundreds of thousands of people across the EU campaigned for strong rules to tackle excessive food speculation and we have not gone away. We are concerned that public interest is being subordinated to the interests of the big energy and financial companies.
We call on you to ensure that the technical standards will force national authorities to set stringent position limits and close the loopholes around exemptions. You can find the technical details in the joint memo by Finance Watch, Oxfam, Global Justice Now and SOMO sent to you in October 2015.
Friends of the Earth Europe
SOMO (Centre for Research on Multinational Corporations)
Amigos de la Tierra España
Fundacion Global Nature
COAG: Coordinadora de Organizaciones Agrarias y Ganaderas
Ecologistas en Acción
VSF - Justicia Alimentaria Global
SEAE: Sociedad Española de Agricultura Ecológica Xarxa de Consum Solidari
Movimiento de Jóvenes Rurales Cristianos
Red África Europa
Colectivos de Acción Solidaria
Agricultural Christian Fellowship
Global Justice Now
Send a Cow
The Centre for Food Policy (City University London)
Katholische Arbeitnehmerbewegung Deutschland (KAB)
SÜDWIND e.V. - Institut für Ökonomie und Ökumene
World Economy, Ecology & Development (WEED)