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The Framework for Financial Data Access (FiDA), which should enable open finance in the EU, has not been withdrawn by the European Commission as earlier leaked documents suggested.
“Argh” read a text sent by one source as the news broke that after the commotion of the past few days, FiDA had in fact survived to see another day.
Like other regulatory initiatives such as the revised Payment Services Directive (PSD3), the Payment Services Regulation (PSR) and the digital euro and access to cash initiatives currently being negotiated by the EU, FiDA is listed by the European Commission as a "pending" proposal.
Documents seen by Vixio suggested that FiDA is “not aligned with the commission's current objectives” and “would introduce significant burden and complexity for financial actors, going against the commission goal of simplification”.
The fact that the FiDA text has now been added back into pending proposals has been described as “bizarre” by one source in the payments space.
One suggestion is that the European Commission’s financial services arm may have been blindsided by the decision to remove the regulation from pending proposals.
This may indeed be the case, considering that it was being advocated for until last week by the commission’s representatives.
Maria Luís Albuquerque, the European commissioner for financial services and the savings and investments union, spoke highly of the regulation at a conference in Brussels (February 4).
“The ‘FIDA' proposal will put users in full control,” the politician said during a speech at the 9th Annual Fintech and Regulation Conference.
“We need to be ambitious and aim for a swift agreement on FIDA with the Council and Parliament. We already have a strong starting position, with alignment on key aspects including scope and schemes, which are crucial building blocks to make it a success,” she said.
“We expect to see even greater innovation through open finance.”
Other proposals shelved
Although FiDA has been reprieved, the commission has decided to withdraw the long-stalled ePrivacy Regulation.
The regulation was first proposed in 2017 as a way to strengthen privacy rules for electronic communications, but faced prolonged negotiations and criticism from allies including the US and UK.
In addition, the commission appears to have dropped the Artificial Intelligence Liability Directive (AILD), introduced in 2022 to establish clearer liability rules for AI-related harm.
Both initiatives were abandoned due to legislative deadlock and shifting regulatory priorities.
The news has received a mixed response from the Computer & Communications Industry Association (CCIA Europe), whose membership includes several big tech players.
Daniel Friedlaender, head of the CCIA, said that “the commission has shown a willingness to review past work, which is laudable”.
“Withdrawing legislation on a regular basis should become normal in a well functioning EU,” he said.
However, Friedlaender also said that “open-finance rules have been diluted by EU co-legislators to favour big banks”.
“This whole process feels haphazard, with many unnecessary proposals still left in place.”
This may be in part due to the European Parliament’s push for digital platforms designated as gatekeepers under the EU’s Digital Markets Act (DMA) to be excluded from becoming financial information service providers under the FiDA.
This would mean that Alphabet, Amazon, Apple, ByteDance, Meta and Microsoft would all be excluded from the framework.
According to the European Parliament’s Economic and Monetary Affairs (ECON) Committee, these are platforms whose dominant online position makes it virtually impossible for businesses to reach end users if not through their gateways.
Their exclusion aims to ensure that they could not circumvent the rules to control open finance markets, a decision criticised by CCIA at the time as “clearly disproportionate”.
