EBA published the final draft regulatory and implementing technical standards on cooperation and information exchange between competent authorities involved in the prudential supervision of investment firms. One final draft sets out the regulatory technical standards on supervisory colleges for investment firm groups, in accordance with the Investment Firms Directive (IFD). The other final draft sets out the regulatory and implementing technical standards on information exchange between competent authorities of home and host member states in accordance with the IFD. These draft standards are part of the phase 2 mandates of the EBA roadmap on investment firms.
The regulatory standards on colleges of investment firms specify the conditions under which colleges of supervisors exercise their tasks and target the investment firm groups falling under the remit of the IFD. These standards are built on experience gained over the years in the colleges of supervisors of credit institutions and larger and more complex investment firm groups that have been established in accordance with the Capital Requirements Directive (CRD). The standards are structured into specifications on establishment of colleges, functioning of colleges, planning and coordination of supervisory activities in going-concern situations, and planning and coordination of supervisory activities in preparation for, and during, emergency situations. The standards provide a set of criteria to help group supervisors to determine whether the establishment of a college of supervisors is appropriate. The standards also specify the information to be exchanged and cooperation between the authorities to be organized for certain joint activities, such as the Supervisory Review and Evaluation Process (SREP), the ongoing review of the permission to use internal models, and the compliance issues.
The regulatory and implementing standards on information exchange between the competent authorities of home and host member states complement the standards on colleges of supervisors and address situations where investment firms operate in another member state through branches or the free provision of services, where colleges may not be established. The regulatory technical standards address requirements related to information exchange for investment firms that operate through branches in other member states and that provide services on a cross-border basis in other member state. The implementing technical standards apply in relation to the information specified in the proposed regulatory technical standards. The implementing standards:
- set out procedures, including the timelines, contact lists and common formats, and templates (included in Annex), for regular exchange of information regarding compliance with own funds, concentration risk and liquidity requirements and regarding findings of supervision of investment firms, linking the frequency of exchanging such information with the outcomes of SREP assessments, where relevant.
- establish a more expedited procedure for information exchange regarding issues of non-compliance with regulatory requirements and application of supervisory administrative penalties or other administrative measures.
- set out the procedure for information requests regarding institutions providing services in other member states through the freedom to provide services and for ad hoc information requests.
Keywords: Europe, EU, Banking, Securities, IFD, Investment Firms, CRD, Supervisory Colleges, Regulatory Technical Standards, Implementing Technical Standards, Information Exchange, SREP, Basel, EBA
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