May 22, 2019

ESAs launched a consultation on draft implementing technical standards on the reporting of intra-group transactions and risk concentration for financial conglomerates subject to supplementary supervision in the EU. The draft technical standards were developed based on the mandate included in the Financial Conglomerates Directive (FICOD). Also published are the draft templates and instructions for the reporting. The consultation ends on August 15, 2019 while the expected implementation period for the proposed changes is approximately one year. The regulation, once published in the Official Journal of European Union, shall apply from January 01, 2020.

The draft implementing technical standards provide the foundation for harmonization of reporting, with a single set of templates, a single embedded dictionary using common definitions, and a single set of instructions to fill in the templates. The implementing technical standards will help the coordinators and other relevant competent authorities to identify relevant issues and exchange information more efficiently, thus reducing costs and fostering a level playing field across financial conglomerates in EU. Furthermore, they will ensure fair competition while reducing regulatory complexity and firms' compliance costs, especially for financial conglomerates operating on a cross-border basis.

Post the end of the consultation, the Joint Committee of ESAs will revise the proposal, taking into account the feedback received. The intra-group transactions that would need to be reported are those significant between:

  • Regulated entities of different sectors belonging to the same financial conglomerate
  • Regulated entities of the same sector belonging to the same financial conglomerate
  • A regulated entity and a non-regulated entity belonging to the same financial conglomerate
  • A regulated entity and any natural or legal person linked to the undertakings of the financial conglomerate by close links

 

Related Links

Comment Due Date: August 15, 2019

Keywords: Europe, EU, Banking, Insurance, Securities, Reporting, Intra-group Transaction, FICOD, Risk Concentration, Solvency II, CRR, ESAs

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