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Next Tuesday, the European Parliament will vote on its mandate to negotiate the new European rules on retail investment with EU member states. The vote will take place because the Socialists and Democrats challenged the harmful mandate agreed on by the conservatives and liberals, who joined forces with the far right.*

The S&Ds contest the mandate for being overly industry-friendly and for failing to protect small investors, which should be the purpose of this new law. Instead, it goes against consumers' interests and undermines the capital markets union, which is unacceptable for our Group.

Eero Heinluoma, S&D negotiator on the EU retail investment legislation, said:

Europeans should be able to save for their own pension, not for the pension of their bankers. That is why the S&Ds contest the harmful deal on the new retail investment rules brokered by the conservatives and liberals in collaboration with the far right. This deal would seriously harm small investors and undermine the capital markets union.

The choice is simple protect small investors, or side with the far right and protect bankers interests. We urge the liberals and conservatives to make the right call and protect consumers, give a clear no to conflicts of interest in financial advice and be true to their vow to not cooperate with the extreme right.

Jons Fernndez, S&D spokesperson on economic and monetary affairs, said:

For a long time, the S&Ds have been calling for retail investment rules focused on people to ensure the protection of small investors when seeking financial advice to secure their life savings and put money aside for their retirement or for a rainy day.

The new EU retail investment legislation could have been an opportunity to put citizens' interests first. Unfortunately, the final deal, brokered by the liberals in collaboration with the far right, will not lead to a fundamental change in existing business practices. Even minor improvements proposed by the Commission, such as the partial ban on inducements, have been completely discarded. For our political family, this is unacceptable." **

Notes to editors:

* In March, the European Parliaments committee on economic affairs adopted the report and the mandate on the new retail investment rules with the majority obtained by conservatives and liberals, joining forces with the far right. Unless contested by at least 71 MEPs, the committees outcome becomes the Parliaments position. The S&D Group contested the mandate, which led to the plenary vote expected next Tuesday.

**Most financial advisers in Europe receive inducements or 'sales commissions when recommending investment products to clients, instead of charging a transparent advice fee. This leads to biased financial advice, with advisers recommending products that offer higher commission payments for them.

The S&Ds have long been advocating for a full ban on biased financial advice, or an inducement ban, as already implemented in the Netherlands and the UK. This would have been the most effective measure to end potential conflicts of interests, protect small investors and ensure that financial markets truly work for people. This is also supported by the Commission's own impact assessment.

Last May, following extensive industry lobbying, the European Commission proposed at least a partial ban on inducements in case of non-advised sales, which would be a bare minimum to improve the damaging status quo.

However, the liberal rapporteur on this file, Stphanie Yon-Courtin, supported by the conservatives and the far right, fully removed this partial ban from the Parliaments mandate and weakened many other safeguards introduced in the proposal.

Even Commissioner for capital markets, Mairead McGuinness, who presented the legislative proposal, publicly expressed her disappointment with the outcome in the European Parliament.

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S&Ds contest harmful deal on the new EU retail investment law, brokered by liberals in cooperation with the far right - Socialists & Democrats