EU Financial Transaction Tax (FTT)

During negotiations in relation to the European financial transaction tax ("FTT"), it became clear that it would be difficult to reach consensus across the 27 Member States. At the request of 11 Member States, namely France, Germany, Belgium, Portugal, Slovenia, Austria, Greece, Italy, Spain, Slovakia and Estonia, the European Commission has adopted a proposal to implement the FTT under the "enhanced cooperation" procedure.

The FTT shall be implemented by January 2014 only by those Member States opting into the "enhanced cooperation" procedure.

Nonetheless, the FTT will have an impact on investors all over the world. Indeed, in its current form, the FTT would be levied on all transactions on financial instruments between financial institutions when at least one party to the transaction is located in a participating country (i.e. when at least one party is located in a country participating in the enhanced cooperation).