Featured Product

    EU Amends CRD4 and CRD5 as Part of Capital Markets Recovery Package

    February 26, 2021

    EU published Directive 2021/338, which amends the Markets in Financial Instruments Directive (MiFID) II and the Capital Requirements Directives (CRD 4 and 5) to facilitate recovery from the COVID-19 crisis. The amendments to MiFID II are related to the information requirements, product governance, and position limits while amendments to CRD4 and 5 are related to the application of these directives to investment firms. To ensure a consistent application of the legal framework applicable to the investment firms set out in Article 67 of the Investment Firms Directive (IFD or Directive 2019/2034), the transposition deadline for CRD5 with respect to investment firms has been extended to June 26, 2021. Directive 2021/338 shall enter into force on the day following that of its publication in the Official Journal of the European Union.

    An amendment to CRD4 is specified in Article 3 of Directive 2021/338, which states that, for the purpose of identifying staff whose professional activities have a material impact on the institution’s risk profile as referred to in Article 92(3), except as regards staff in investment firms, EBA shall develop draft regulatory technical standards setting out the criteria to define the following:

    • Managerial responsibility and control functions;
    • Material business unit and significant impact on the relevant business unit’s risk profile; and 
    • Other categories of staff not expressly referred to in Article 92(3) whose professional activities have an impact on the institution’s risk profile comparably as material as that of those categories of staff referred to therein.

    Regarding the application of these regulatory technical standards to investment firms, the empowerment laid down in Article 94(2) of CRD4, as amended by CRD5, shall continue to apply until June 26, 2021. Furthermore, Article 4 (on transposition) of Directive 2021/338 specifies that member states shall adopt and publish by November 20, 2021 the laws, regulations, and administrative provisions necessary to comply with this Directive. They shall apply the measures from February 28, 2022. Member states shall communicate to EC the text of the main provisions of national law, which they adopt in the field covered by this Directive. By way of derogation from paragraph 1, the amendments to CRD4 and CRD5 shall apply from December 28, 2020. The amendments in Directive 2021/338 form a part of the changes proposed under the EU Capital Markets Recovery Package. 

     

    Related Links

    Effective Date: February 27, 2021

    Keywords: Europe, EU, Banking, Securities, Investment Firms, COVID-19, IFD, CRD5, CRD4, Basel, Remuneration Requirements, European Council, European Parliament

    Featured Experts
    Related Articles
    News

    ESAs Issue Multiple Regulatory Updates for Financial Sector Entities

    The three European Supervisory Authorities (ESAs) issued a letter to inform about delay in the Sustainable Finance Disclosure Regulation (SFDR) mandate, along with a Call for Evidence on greenwashing practices.

    November 15, 2022 WebPage Regulatory News
    News

    ISSB Makes Announcements at COP27; IASB to Propose IFRS 9 Amendments

    The International Sustainability Standards Board (ISSB) of the IFRS Foundations made several announcements at COP27 and with respect to its work on the sustainability standards.

    November 10, 2022 WebPage Regulatory News
    News

    IOSCO Prioritizes Green Disclosures, Greenwashing, and Carbon Markets

    The International Organization for Securities Commissions (IOSCO), at COP27, outlined the regulatory priorities for sustainability disclosures, mitigation of greenwashing, and promotion of integrity in carbon markets.

    November 09, 2022 WebPage Regulatory News
    News

    EBA Finalizes Methodology for Stress Tests, Issues Other Updates

    The European Banking Authority (EBA) issued a statement in the context of COP27, clarified the operationalization of intermediate EU parent undertakings (IPUs) of third-country groups

    November 09, 2022 WebPage Regulatory News
    News

    OSFI Sets Out Work Priorities and Reporting Updates for Banks

    The Office of the Superintendent of Financial Institutions (OSFI) published an annual report on its activities, a report on forward-looking work.

    November 07, 2022 WebPage Regulatory News
    News

    APRA Finalizes Changes to Capital Framework, Issues Other Updates

    The Australian Prudential Regulation Authority (APRA) finalized amendments to the capital framework, announced a review of the prudential framework for groups.

    November 03, 2022 WebPage Regulatory News
    News

    BIS Hub and Central Banks Conduct CBDC and DeFI Pilots

    The Bank for International Settlements (BIS) Innovation Hubs and several central banks are working together on various central bank digital currency (CBDC) pilots.

    November 03, 2022 WebPage Regulatory News
    News

    FASB Proposes Improvements to 2023 GAAP Reporting Taxonomy

    The Financial Accounting Standards Board (FASB) is seeking comments, until November 03, 2022, on the proposed technical and other conforming improvements for the 2023 GAAP Financial Reporting Taxonomy.

    November 03, 2022 WebPage Regulatory News
    News

    ECB Sets Deadline for Banks to Meet Its Climate Risk Expectations

    The European Central Bank (ECB) published the results of its thematic review, which shows that banks are still far from adequately managing climate and environmental risks.

    November 02, 2022 WebPage Regulatory News
    News

    ESAs, ECB, & EC Issue Multiple Regulatory Updates for Financial Sector

    Among its recent publications, the European Banking Authority (EBA) published the final standards and guidelines on interest rate risk arising from non-trading book activities (IRRBB)

    October 31, 2022 WebPage Regulatory News
    RESULTS 1 - 10 OF 8588