Brussels this week has been abuzz with ideas about how to make the euro zone's main bailout fund more effective, The Wall Street Journal’s Brussels Beat blog reported in a commentary. As the crisis that started in Greece and enveloped Ireland now threatens to overtake Portugal, it's evident that the European Financial Stability Fund has not provided a firebreak between countries that its architects hoped for when it was created in May.

French President Nicolas Sarkozy has said Ireland cannot benefit from the EU’s financial aid while maintaining its low corporate tax rate, the Irish Times reported. Making the case for closer fiscal harmonisation between euro zone states, Mr Sarkozy said: “I deeply respect our Irish friends’ independence and we have done everything to help them. But they cannot continue to say ‘come and help us’ while keeping a tax on company profits that is half [that of other countries]…We cannot speak about economic integration without the convergence of fiscal systems . . .

Europe has yet to allay investor “skepticism” about the sustainability of the region’s debt, and any spread of the crisis would cloud global economic prospects, the International Monetary Fund’s number three official said, Bloomberg reported. “At least for now it looks like the spillover from the European sovereign crisis to areas outside of the region will be limited,” Naoyuki Shinohara, deputy managing director at the IMF, said in an interview in Tokyo yesterday.

A proposal to pay the holders of some €1.3 billion of Quinn Group debt a cash payment of up to €200 million, in lieu of guarantees over the assets of subsidiary companies of Quinn Insurance, was one of a series of recommendations put forward by the Quinn family in its discussions with Anglo Irish Bank on a possible joint takeover of the insurer, the Irish Times reported. The details of the Quinn family’s proposals for its proposed takeover of the company have emerged as the sale of Quinn Insurance reaches its final stages.

Engineering company Siemens has provided funding to fulfil a wind turbine equipment order at a Scottish factory which went bankrupt last week, administrator Ernst & Young said on Wednesday, Reuters reported. 130 workers at the factory in Machrihanish on the west coast of Scotland -- owned by Danish wind power company Skykon -- will be able to return to work on Thursday to complete an order for 30 wind turbine towers destined for a 350-megawatt onshore wind farm in Lanarkshire, Scotland.

Germany is backing proposals to give new powers and lending capacity to the €440bn ($577bn) eurozone rescue fund, even if that means increasing its financial guarantees, according to people familiar with the issue in Berlin and Brussels, the Financial Times reported. Such a move would be part of a package of measures, including greater co-ordination of economic policymaking between the 17 eurozone members, that could be agreed by European Union heads of government at their next summit in February.

Harles and Jentzsch, a manufacturer accused of supplying dioxin-laced fat to the animal-feed industry in Germany, filed in court for insolvency on Wednesday, Monsters and Critics reported. The company, based in Uetersen, north-west of Hamburg, is under investigation by prosecutors and may also potentially face vast civil claims from 5,000 German farms that were idled during the dioxin scare that blew up last week. A spokeswoman for the state court in Itzehoe, Julia Gaertner, said the company had filed for protection from its creditors.

Lazard was the world's top bank for bankruptcy and restructurings in 2010, as debt turmoil in the Middle East and a sovereign debt crisis increased the workload for advisors in Europe. Worldwide, the total value of completed deals was down 6.2 percent to $305 billion in 2010, as a vibrant U.S. high-yield bond market helped firms manage their debt burden, Thomson Reuters data released on Tuesday showed.

As neighboring Portugal seems to move inexorably toward requesting a bailout, Spanish Prime Minister José Luis Rodríguez Zapatero pledged to accelerate the cleanup of his country's opaque network of savings banks known as cajas, The Wall Street Journal reported. This means the cajas for the first time will disclose the extent of their exposure to troubled real-estate and construction loans, a move that could trigger injections of government funds into some of the banks. The cleanup effort is part of Spain's attempt to convince investors it isn't another Portugal or Ireland.

The world’s biggest banks are seeking to revive global efforts to create a resolution mechanism to deal with failing financial giants in a bid to stave off higher capital charges and other options that they say could damage their bottom lines, the Financial Times reported. The Institute of International Finance, a leading industry group, is lobbying to put the issue on the agenda when leaders of the G20 leading economies next gather. On Wednesday, IIF representatives are meeting French officials, who will host this year’s gathering in November, to press their case.