Article 21b | European Banking Authority

Description: Intermediate EU parent undertaking
Main content: 1.
Two or more institutions in the Union, which are part of the same third-country group, shall have a single intermediate EU parent undertaking that is established in the Union.

2.

Competent authorities may allow the institutions referred to in paragraph 1 to have two intermediate EU parent undertakings where they determine that the establishment of a single intermediate EU parent undertaking would:

(a)

be incompatible with a mandatory requirement for separation of activities imposed by the rules or supervisory authorities of the third country where the ultimate parent undertaking of the third-country group has its head office; or

(b)

render resolvability less efficient than in the case of two intermediate EU parent undertakings according to an assessment carried out by the competent resolution authority of the intermediate EU parent undertaking.

3.
An intermediate EU parent undertaking shall be a credit institution authorised in accordance with Article 8, or a financial holding company or mixed financial holding company that has been granted approval in accordance with Article 21a.

By way of derogation from the first subparagraph of this paragraph, where none of the institutions referred to in paragraph 1 of this Article is a credit institution or where a second intermediate EU parent undertaking must be set up in connection with investment activities to comply with a mandatory requirement as referred to in paragraph 2 of this Article, the intermediate EU parent undertaking or the second intermediate EU parent undertaking, may be an investment firm authorised in accordance with Article 5(1) of Directive 2014/65/EU that is subject to Directive 2014/59/EU.

4.
Paragraphs 1, 2 and 3 shall not apply where the total value of assets in the Union of the third-country group is less than EUR 40 billion.

5.

For the purposes of this Article:

(a)

the total value of assets in the Union of the third‐country group shall be the sum of the following:

(i)

the total value of assets of each institution in the Union of the third‐country group, as resulting from its consolidated balance sheet or as resulting from their individual balance sheets, where an institution’s balance sheet is not consolidated; and

(ii)

the total value of assets of each branch of the third‐country group authorised in the Union in accordance with this Directive, Regulation (EU) No 600/2014 of the European Parliament and of the Council ( 4 ) or Directive 2014/65/EU;

(b)

the term ‘institution’ shall also include investment firms.

6.

Competent authorities shall notify the following information in respect of each third-country group operating in their jurisdiction to EBA:

(a)

the names and the total value of assets of supervised institutions belonging to a third-country group;

(b)

the names and the total value of assets corresponding to branches authorised in that Member State in accordance with this Directive, Directive 2014/65/EU or Regulation (EU) No 600/2014, and the types of activities that they are authorised to carry out;

(c)

the name and the type as referred to in paragraph 3 of any intermediate EU parent undertaking set up in that Member State and the name of the third-country group of which it is part.

7.
EBA shall publish on its website a list of all third-country groups operating in the Union and their intermediate EU parent undertaking or undertakings, where applicable.

Competent authorities shall ensure that each institution under their jurisdiction that is part of a third-country group meets one of the following conditions:

(a)

it has an intermediate EU parent undertaking;

(b)

it is an intermediate EU parent undertaking;

(c)

it is the only institution in the Union of the third-country group; or

(d)

it is part of a third-country group with a total value of assets in the Union of less than EUR 40 billion.

8.
By way of derogation from paragraph 1, third-country groups operating through more than one institution in the Union and with a total value of assets in the Union equal to or greater than EUR 40 billion on 27 June 2019 shall have an intermediate EU parent undertaking or, if paragraph 2 applies, two intermediate EU parent undertakings by 30 December 2023.

9.

By 30 December 2026 the Commission shall, after consulting EBA, review the requirements imposed on institutions by this Article and submit a report to the European Parliament and to the Council. That report shall, at least, consider:

(a)

whether the requirements laid down in this Article are operable, necessary and proportionate and whether other measures would be more appropriate;

(b)

whether the requirements imposed on institutions by this Article should be revised to reflect best international practices.

10.

By 28 June 2021, EBA shall submit a report to the European Parliament, to the Council and to the Commission on the treatment of third-country branches under national law of Member States. That report shall, at least, consider:

(a)

whether and to what extent supervisory practices under national law for third-country branches differ between Member States;

(b)

whether a different treatment of third-country branches under national law could result in regulatory arbitrage;

(c)

whether further harmonisation of national regimes for third-country branches would be necessary and appropriate, especially with regard to significant third-country branches.

The Commission shall, if appropriate, submit a legislative proposal to the European Parliament and to the Council, based on the recommendations made by EBA.

Footnotes
( 1 ) Directive 2014/59/EU of the European Parliament and of the Council of 15 May 2014 establishing a framework for the recovery and resolution of credit institutions and investment firms and amending Council Directive 82/891/EEC, and Directives 2001/24/EC, 2002/47/EC, 2004/25/EC, 2005/56/EC, 2007/36/EC, 2011/35/EU, 2012/30/EU and 2013/36/EU, and Regulations (EU) No 1093/2010 and (EU) No 648/2012, of the European Parliament and of the Council (OJ L 173, 12.6.2014, p. 190).
( 2 ) OJ L 390, 31.12.2004, p. 38.
( 3 ) Regulation (EU) No 1094/2010 of the European Parliament and of the Council of 24 November 2010 establishing a European Supervisory Authority (European Insurance and Occupational Pensions Authority), amending Decision No 716/2009/EC and repealing Commission Decision 2009/79/EC (OJ L 331, 15.12.2010, p. 48).
( 4 ) Regulation (EU) No 600/2014 of the European Parliament and of the Council of 15 May 2014 on markets in financial instruments and amending Regulation (EU) No 648/2012 (OJ L 173, 12.6.2014, p. 84).
( 5 ) OJ L 309, 25.11.2005, p. 15.
( 6 ) Regulation (EU) No 1095/2010 of the European Parliament and of the Council of 24 November 2010 establishing a European Supervisory Authority (European Securities and Markets Authority), amending Decision No 716/2009/EC and repealing Commission Decision 2009/77/EC (OJ L 331, 15.12.2010, p. 84).
( 7 ) Regulation (EU) 2019/2033 of the European Parliament and of the Council of 27 November 2019 on the prudential requirements of investment firms and amending Regulations (EU) No 1093/2010, (EU) No 575/2013, (EU) No 600/2014 and (EU) No 806/2014 (OJ L 314, 5.12.2019, p. 1).
( 8 ) Directive (EU) 2019/2034 of the European Parliament and of the Council of 27 November 2019 on the prudential supervision of investment firms and amending Directives 2002/87/EC, 2009/65/EC, 2011/61/EU, 2013/36/EU, 2014/59/EU and 2014/65/EU (OJ L 314, 5.12.2019, p. 64).
( 9 ) Directive (EU) 2015/849 of the European Parliament and of the Council of 20 May 2015 on the prevention of the use of the financial system for the purposes of money laundering or terrorist financing, amending Regulation (EU) No 648/2012 of the European Parliament and of the Council, and repealing Directive 2005/60/EC of the European Parliament and of the Council and Commission Directive 2006/70/EC (OJ L 141, 5.6.2015, p. 73).
( 10 ) OJ L 331, 15.12.2010, p. 48.
( 11 ) Regulation (EU) 2016/679 of the European Parliament and of the Council of 27 April 2016 on the protection of natural persons with regard to the processing of personal data and on the free movement of such data, and repealing Directive 95/46/EC (General Data Protection Regulation) (OJ L 119, 4.5.2016, p. 1).
( 12 ) OJ L 157, 9.6.2006, p. 87.
( 13 ) OJ L 222, 14.8.1978, p. 11.
( 14 ) OJ L 193, 18.7.1983, p. 1.
( 15 ) OJ L 120, 15.5.2009, p. 22.
( 16 ) Commission Directive 2006/73/EC of 10 August 2006 implementing Directive 2004/39/EC of the European Parliament and of the Council as regards organisational requirements and operating conditions for investment firms and defined terms for the purposes of that Directive (OJ L 241, 2.9.2006, p. 26).
( 17 ) Directive (EU) 2018/843 of the European Parliament and of the Council of 30 May 2018 amending Directive (EU) 2015/849 on the prevention of the use of the financial system for the purposes of money laundering or terrorist financing, and amending Directives 2009/138/EC and 2013/36/EU (OJ L 156, 19.6.2018, p. 43).
( 18 ) Regulation (EU) 2017/2402 of the European Parliament and of the Council of 12 December 2017 laying down a general framework for securitisation and creating a specific framework for simple, transparent and standardised securitisation, and amending Directives 2009/65/EC, 2009/138/EC and 2011/61/EU and Regulations (EC) No 1060/2009 and (EU) No 648/2012 (OJ L 347, 28.12.2017, p. 35).
( 19 ) Regulation (EU) No 806/2014 of the European Parliament and of the Council of 15 July 2014 establishing uniform rules and a uniform procedure for the resolution of credit institutions and certain investment firms in the framework of a Single Resolution Mechanism and a Single Resolution Fund and amending Regulation (EU) No 1093/2010 (OJ L 225, 30.7.2014, p. 1).
( 20 ) Directive (EU) 2015/2366 of the European Parliament and of the Council of 25 November 2015 on payment services in the internal market and amending Directives 2002/65/EC, 2009/110/EC, 2013/36/EU and Regulation (EU) No 1093/2010 and repealing Directive 2007/64/EC (OJ L 337, 23.12.2015, p. 35).