2017/0358(COD) Prudential supervision of investment firms
Lead committee dossier:
Progress: Procedure completed
| Role | Committee | Rapporteur | Shadows |
|---|---|---|---|
| Lead | ECON |
FERBER Markus ( PPE)
|
DELVAUX Mady ( S&D),
LUCKE Bernd ( ECR),
TORVALDS Nils ( ALDE),
GIEGOLD Sven ( Verts/ALE),
KAPPEL Barbara ( ENF)
|
| Committee Opinion | DEVE | ||
| Committee Opinion | JURI |
Mady DELVAUX ( S&D)
|
|
| Committee Opinion | ITRE |
Lead committee dossier:
Legal Basis:
TFEU 053-p1
Legal Basis:
TFEU 053-p1Subjects
Events
2019/12/05
Final act published in Official Journal
Details
PURPOSE: to establish a proportionate and risk-based European prudential framework for investment firms.
LEGISLATIVE ACT: Directive (EU) 2019/2034 of the European Parliament and of the Council 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.
CONTENT: the Directive is part of a package of measures (comprising a Regulation and a Directive) establishing a new regulatory framework for investment firms.
Investment firms are financial institutions whose main business is to hold and manage securities and derivatives for investment purposes on behalf of their clients. Until now all investment firms have been subject to the same capital, liquidity and risk management rules as banks. However, the Capital Requirements Regulation and Directive (CRR/CRD IV) do not take full account of the specificities of investment firms.
Prudential supervisory measures
The Directive lays down prudential requirements and supervisory measures adapted to the risk profile and business model of investment firms while safeguarding financial stability. To this end, it lays down rules on
- the initial capital of investment firms;
- supervisory powers and tools for the prudential supervision of investment firms by competent authorities;
- the prudential supervision of investment firms by competent authorities in a manner that is consistent with the rules set out in Regulation (EU) 2019/2033;
- publication requirements for competent authorities in the field of prudential regulation and supervision of investment firms.
An effective and proportionate prudential framework
Investment firms shall be subject to the same key measures, in particular as regards capital holdings, reporting, corporate governance and remuneration, but the requirements they shall be required to apply will vary according to their size, nature and complexity:
- investment firms that provide bank-like services, such as proprietary trading, and whose consolidated assets exceed EUR 15 billion shall automatically fall under CRR/CRD IV;
- however, competent authorities may decide to apply the requirements of the Regulation and the Capital Requirements Directive (CRR/CRD IV) to investment firms which provide bank-type activities and whose total consolidated assets exceed EUR 5 billion, in particular where the size of the firm or its activities is likely to give rise to systemic risk;
- small firms which are not considered systemic shall benefit from a new adapted regime with specific prudential requirements.
Competent authorities shall ensure that investment firms have strategies and processes in place to assess and maintain the adequacy of their internal capital. They shall require non-interconnected small investment firms to apply similar requirements where appropriate.
Internal Governance
Investment firms shall have robust governance arrangements, including all of the following:
- a clear organisational structure with well‐defined, transparent and consistent lines of responsibility;
- effective processes to identify, manage, monitor and report the risks that investment firms are or might be exposed to, or the risks that they pose or might pose to others;
- adequate internal control mechanisms, including sound administration and accounting procedures;
- remuneration policies and practices that are consistent with and promote sound and effective risk management. The principle of equal pay for men and women workers for equal work or work of equal value shall be applied consistently by investment firms.
Environmental, social and governance (ESG) objectives
The European Banking Authority (EBA) shall prepare a report on the introduction of technical criteria related to exposures to activities closely linked to environmental, social and governance (ESG) objectives for the supervisory review and evaluation process of risks, with a view to assessing the possible sources and effects of these risks on investment firms.
No later than 26 June 2024, the Commission shall submit a report to the European Parliament and the Council, accompanied where appropriate by a legislative proposal taking into account the EBA report, on whether ESG risks should be taken into account for the internal governance of an investment firm.
Third countries
The Commission shall submit recommendations to the Council for the negotiation of agreements between the Union and third countries for the practical exercise of supervision of compliance with the group capital test for investment firms, the parent undertakings of which are established in third countries, and for investment firms operating in third countries the parent undertakings of which are established in the Union.
In addition, Member States and the EBA shall conclude cooperation agreements with third countries for the purpose of carrying out their supervisory tasks.
ENTRY INTO FORCE: 25.12.2019.
TRANSPOSITION AND APPLICATION: from 26.6.2021.
2019/11/27
CSL - Draft final act
Documents
2019/11/27
CSL - Final act signed
2019/11/25
EP - End of procedure in Parliament
2019/11/08
EP/CSL - Act adopted by Council after Parliament's 1st reading
2019/11/08
CSL - Council Meeting
2019/10/07
FR_SENATE - Contribution
Documents
2019/08/08
EC - Commission response to text adopted in plenary
Documents
2019/04/16
EP - Results of vote in Parliament
Documents
2019/04/16
EP - Decision by Parliament, 1st reading
Details
The European Parliament adopted by 534 votes to 63, with 55 abstentions, a legislative resolution on the proposal for a directive of the European Parliament and of the Council on the prudential supervision of investment firms and amending Directives 2013/36/EU and 2014/65/EU.
The European Parliament's position adopted at first reading under the ordinary legislative procedure amend the Commission's proposal as follows.
Objective
The proposed proposal for a Directive establishes effective, appropriate and proportionate prudential arrangements at Union level that help to ensure that investment firms authorised to operate within the Union operate on a sound financial basis and are managed in an orderly way including in the best interests of their clients.
To this end, it shall establish rules concerning:
- the initial capital of investment firms;
- supervisory powers and tools for the prudential supervision of investment firms by competent authorities;
- publication requirements for competent authorities in the field of prudential supervision of investment firms.
Discretion of competent authorities to subject certain investment firms to the requirements of Regulation (EU) 575/2013 (the Own Funds Regulation, or CRR)
Competent authorities may decide to apply the requirements of the Regulation and the Capital Requirements Directive (CRR/CRD IV) to an investment firm that carries out any of the activities where the total value of the consolidated assets of the investment firm exceeds EUR 5 billion, in particular where the firm carries out these activities on such a scale that the failure or distress of the investment firm could lead to systemic risk.
Investment firms which are not considered small and non-interconnected should have internal capital available which is adequate in quantity, quality and distribution to cover the specific risks to which they are or may be exposed. Competent authorities should ensure that investment firms have the adequate strategies and processes in place to assess and maintain the adequacy of their internal capital. Competent authorities should be able to request also small and non-interconnected firms to apply similar requirements where appropriate.
Competent authorities could define additional requirements, in particular with regard to capital and liquidity requirements, in particular for investment firms that are not considered to be small non-interconnected investment firms and, where the competent authority considers it justified and appropriate, for small non-interconnected investment firms.
Remuneration policy
The remuneration policy shall: (i) be clearly documented and proportionate to the size, internal organisation, nature, scope and complexity of the investment firm's activities; (ii) be a gender neutral remuneration policy; (iii) be in line with the business strategy and objectives of the investment firm, and also takes into account long term effects of the investment decisions taken; (iv) be subject, at least once a year, to a central and independent internal review on control functions.
Member States shall ensure that investment firms provide the competent authorities, on request, with the total amounts of remuneration for each member of the management body or general management.
EBA report on environmental, social or governance (ESG) related risks
EBA shall prepare a report on the introduction of technical criteria related to exposures to activities associated substantially with environmental, social, and governance (ESG) objectives for the supervisory review and evaluation process of risks, with a view to assessing the possible sources and effects of such risks on investment firms.
The EBA shall submit a report on its conclusions to the European Parliament, the Council and the Commission no later than two years after the date of entry into force of this Directive.
Cooperation between the competent authorities of different Member States
The competent authorities of different Member States should cooperate closely in carrying out their tasks under the Directive, in particular by exchanging information on investment firms without delay.
Any investment firm may trade through a clearing member in another Member State. The amended text provides that the competent authority of an investment firm’s home Member State may request to the competent authority of a clearing member’s home Member State information relating to the margin model and parameters used for the calculation of the margin requirement of the relevant investment firm.
Sanctions
To safeguard compliance with the obligations laid down in this Directive, Member States should provide for administrative sanctions and other administrative measures which are effective, proportionate and dissuasive. In order to ensure that administrative sanctions have a dissuasive effect they should be published except in certain well-defined circumstances. To enable clients and investors to make an informed decision about their investment options, those clients and investors should have access to information on administrative sanctions and measures imposed on investment firms.
Documents
2019/04/15
EP - Debate in Parliament
Documents
2019/04/01
EP - Approval in committee of the text agreed at 1st reading interinstitutional negotiations
Documents
2019/03/20
CSL - Coreper letter confirming interinstitutional agreement
Documents
2018/10/03
EP - Committee decision to enter into interinstitutional negotiations confirmed by plenary (Rule 71)
2018/10/01
EP - Committee decision to enter into interinstitutional negotiations announced in plenary (Rule 71)
2018/09/27
EP - Committee report tabled for plenary, 1st reading
Details
The Committee on Economic and Monetary Affairs adopted the report by Markus FERBER (EPP, DE) on the proposal for a directive of the European Parliament and of the Council on the prudential supervision of investment firms and amending Directives 2013/36/EU and 2014/65/EU.
The committee recommended that the European Parliament's position adopted at first reading under the ordinary legislative procedure should amend the Commission's proposal as follows.
Objective : the proposed proposal for a Directive establishes effective, appropriate and proportionate prudential arrangements at Union level that help to ensure that investment firms authorised to operate within the Union operate on a sound financial basis and are managed in an orderly way including in the best interests of their clients. To this end, it shall establish rules concerning:
the initial capital of investment firms; supervisory powers and tools for the prudential supervision of investment firms by competent authorities; publication requirements for competent authorities in the field of prudential supervision of investment firms.
These measures shall help to:
provide a level playing field across the EU and guaranteeing effective prudential supervision, while keeping compliance costs in check and ensuring sufficient capital for the risks of most investment firms; strike a balance between ensuring the safety and soundness of different investment companies and avoiding excessive costs that might undermine the viability of their business activity; ensure harmonised prudential supervision of investment firms across the Union functioning promptly and efficiently.
Competent authorities : Member States shall designate one or more competent authorities to carry out the functions and duties provided for in the Directive and inform the Commission, the European Banking Authority (EBA) and the European Securities and Markets Authority (ESMA) of this designation.
Competent authorities may apply the requirements of Regulation (EU) No 575/2013 (the Own Funds Regulation, or CRR) on an undertaking other than a credit institution provided that certain conditions are met, for example (i) the undertaking is not a commodity dealer or an emission allowances dealer, or a collective investment undertaking, or an insurance undertaking or (ii) it carries out activities similar to those of undertakings which accept deposits or other repayable funds from the public and grant credits on their own accounts.
Any investment firm providing services covered by this Directive shall be required to take out professional liability insurance .
Competent authorities shall ensure that the transition from the current framework to the new one offers sufficient regulatory certainty for investment firms and does not deprive them of substantive rights from which they had benefitted under the current framework.
Capital requirements : prudential supervision and assessment powers shall allow competent authorities to assess qualitative elements, including governance and internal controls and risk management processes and procedures, and, where appropriate, to define additional requirements, in particular with regard to capital and liquidity requirements.
Competent authorities shall only set additional capital requirements for risks not yet covered or insufficiently covered by the K factors defined in the draft regulation accompanying the proposed directive.
Remuneration policy : investment firms shall be subject to clear principles of corporate governance arrangements and rules on remuneration that are gender neutral and that take into account the differences between credit institutions and investment firms.
The remuneration policy shall: (i) be clearly documented and proportionate to the size, internal organisation, nature, scope and complexity of the investment firm's activities; (ii) be non-discriminatory, meaning that identical or similar jobs are remunerated in the same way, regardless of the gender of the person holding the position; (iii) take into account not only the short-term profitability but also the long-term effects of investment decisions.
At least 40% of the variable compensation shall consist of shares or equity instruments. At least 50% of the variable remuneration shall be deferred for a period of five years, depending on the length of the investment firm's business cycle, the nature of its activity, its risks and the activities of the individual in question. If the variable remuneration is particularly high, the proportion of the variable remuneration shall be at least 60%.
Environmental, social and governance objectives (ESG) : the EBA shall prepare a report on the introduction of technical criteria related to exposures to activities associated substantially with environmental, social, and governance (ESG) objectives for the supervisory review and evaluation process of risks, with a view to assessing the possible sources and effects of such risks on investment firms.
It shall submit a report on its conclusions to the European Parliament, the Council and the Commission no later than two years after the date of entry into force of this Directive.
Documents
2018/09/24
EP - Vote in committee, 1st reading
2018/09/24
EP - Committee decision to open interinstitutional negotiations with report adopted in committee
2018/08/22
ECB - European Central Bank: opinion, guideline, report
Details
Opinion of the European Central Bank of 22 August 2018 on the review of prudential treatment of investment firms.
The ECB supports the objective of the proposed regulation and the proposed directive in setting out a prudential framework that is better adapted to the risks and business models of different types of investment firms.
Whilst the ECB generally supports the purpose of subjecting systemically important investment firms to the same prudential rules as credit institutions, the proposed acts should be carefully assessed in order to avoid unintended consequences for other Union legal acts due to the change in the definition of credit institutions.
In particular, the ECB wishes to assess the possible consequences of including Class 1 companies (those whose business consists of own account dealing, underwriting of financial instruments, or placing of financial instruments on a firm commitment basis and whose total assets exceed EUR 30 billion) in the definition of ‘credit institution’.
Classification of investment firms as credit institutions
Under the proposed regulation the criteria according to which an investment firm is to be considered a credit institution within the meaning of Regulation (EU) No 575/2013 (Regulation on prudential requirements for credit institutions and investment firms, Capital Requirement Regulation – CRR) aim to capture systemic investment firms with total assets above certain thresholds.
The ECB welcomes this proposal given that firms which meet these criteria can pose increased financial stability risks. It considers that the proposed regulation should provide clarification as to how the assets are to be calculated, i.e. including the assets of Union branches of third country groups and third country subsidiaries of undertakings in the Union arising from their consolidated balance sheet.
It also suggests that the total asset threshold could be complemented with other criteria including for example a revenue criterion, significance of cross-jurisdictional activity or interconnectedness.
Statistical implications
The ECB notes the importance of ensuring a high degree of consistency and harmonised methodologies for statistical concepts and definitions in Union legislation and between Union statistical legislation and international statistical standards, in particular the System of National Accounts adopted by the United Nations Statistical Commission.
If Class 1 firms are classified as credit institutions, there would be inconsistencies in the common standards, definitions and classifications of relevance for the statistical treatment of financial corporations set out in Union legislation that would need to be remedied.
Macro-prudential perspective on investment firms
The proposed acts do not take on board the EBA recommendations on the need for a macro-prudential perspective on investment firms. A possible future review of the criteria for determining systemic investment firms may also consider whether certain macro-prudential tools could be developed to address specific risks that smaller investment firms could pose to financial stability.
Provision of services by third-country firms
Regarding the Commission’s proposal to strengthen and further harmonise the Unionlegislation applicable to branches of third country investment firms, the ECB considers that the Union legislator might wish to give further consideration to the possibility of applying the harmonised rules to all branches, even those that provide services to professional clients and eligible counterparties, in order to ensure that material risks are addressed consistently across the Union and to avoid regulatory arbitrage.
The proposed regulation strengthens the regime outlined in Regulation (EU) No 600/2014 with regard to the provision of services and performance of activities by third country investment firms after an equivalence decision has been taken. The equivalence of third-country regulatory regimes is used in different areas of relevant Union law and consistency and additional enhancements to those approaches could be further considered.
Furthermore, in order to ensure a level playing field, the ECB suggests ensuring that such non-equivalent third-country firms are required over time to establish a branch (or a subsidiary) in the Union in order to provide any investment services in the Union.
Alignment
The ECB recommends that the interplay between the proposed acts and Directive 2013/36/EU and Regulation (EU) No 575/2013 should be carefully assessed in order to avoid unintended consequences due to the change in the definition of credit institutions. The proposals should, for example, aim to align the wording in the different sectoral acts of Union law so as to harmonise, where appropriate, the scope of professional secrecy obligations.
Documents
2018/07/12
EP - Committee opinion
Documents
2018/06/04
EP - Amendments tabled in committee
Documents
2018/04/11
EP - Committee draft report
Documents
2018/03/28
RO_SENATE - Contribution
Documents
2018/03/08
PT_PARLIAMENT - Contribution
Documents
2018/03/05
ES_PARLIAMENT - Contribution
Documents
2018/01/23
EP - FERBER Markus (PPE) appointed as rapporteur in ECON
2018/01/18
EP - Committee referral announced in Parliament, 1st reading
2017/12/21
EC - Follow-up document
Documents
2017/12/20
EC - Legislative proposal
Details
PURPOSE: to establish a proportionate and risk-based European prudential framework for investment firms.
PROPOSED ACT: Regulation of the European Parliament and of the Council.
ROLE OF THE EUROPEAN PARLIAMENT: the European Parliament decides in accordance with the ordinary legislative procedure and on an equal footing with the Council.
BACKGROUND: investment firms play an important role in facilitating savings and investment flows across the EU. They offer investors (retail, professional, corporate) various services that give them access to the securities and derivatives markets (investment advice, portfolio management, brokerage, execution of orders, etc.). Unlike credit institutions, investment firms do not take deposits or make loans. This means that they are a lot less exposed to credit risk and the risk of depositors withdrawing their money at short notice.
There were 6 051 investment firms in the European Economic Area (EEA) at the end of 2015. Most EEA investment firms are small or medium-sized enterprises . At present, these companies are concentrated in the United Kingdom, but considering relocating part of their operations in the EU-27, particularly to the Member States participating in the banking union. The UK decision to leave the EU highlights the need to modernise the EU's regulatory architecture.
As one of the new priority actions to strengthen capital markets, the Commission announced in its mid-term review of the Capital Markets Union action plan , that it would propose a more effective prudential and supervisory framework, calibrated to the size and nature of investment firms.
This proposal for a directive and the accompanying proposal for a regulation aim to ensure that investment firms that are not systemically important (the majority of them) are subject to capital and liquidity requirements and other key prudential requirements and supervisory measures that are tailored to their activities, but sufficiently stringent not to jeopardize the stability of the EU's financial markets.
The proposals are the outcome of a review mandated by Regulation (EU) No 575/2013 (Capital Requirements Regulation, or CRR) which, together with Directive 2013/36/EU (Capital Requirements Directive IV, or CRD IV), constitutes the current prudential framework for investment firms. The prudential framework applicable to investment firms set out in CRR / CRD IV works in conjunction with the MiFID II Directive / MiFIR Regulation on markets for financial instruments.
Systemically important investment firms, some of which qualify as globally important companies, would remain subject to the existing framework set out in CRR / CRD IV.
IMPACT ASSESSMENT: the review of the prudential framework for investment firms was carried out in consultation with the European Banking Authority (EBA), the European Securities and Markets Authority (ESMA) and the competent national authorities represented in these European Supervisory Authorities.
A working document accompanying the proposal concludes that, overall, the EBA recommendations represent a step towards a prudential framework for investment firms , which ensures that they operate on a sound financial basis, without hindering their commercial prospects.
CONTENT: the proposal for a directive revises and simplifies existing EU rules governing the prudential treatment of investment firms in order to (i) better accommodate and address risks in their business models; (ii) improve the level playing field among firms; and (iii) enhance supervisory convergence.
It applies to all investment firms covered by MIFID II, whose application is scheduled to begin in January 2018. In specific, the proposal:
requires Member States to designate an authority to exercise the prudential supervisory powers provided for in this directive, transferring the relevant provisions of CRD IV to the proposed directive; revises and harmonises throughout the EU the initial capital levels , based on the services and activities that investment firms are authorised to provide in accordance with MIFID, from the levels stipulated in CRD IV to take into account inflation since these levels were set. Transitional arrangements are made to allow smaller firms in particular to attain the new amounts of initial capital where necessary; confers the powers set out in CRD IV on the authorities of home and host countries for the prudential supervision of investment firms and establishes the arrangements for cooperation between these authorities; introduces provisions for the exchange of information between the competent authorities on prudential supervision and professional secrecy on the basis of CRD IV; requires Member States to establish administrative penalties and other administrative measures that are effective, proportionate and dissuasive in order to deal with infringements of the provisions of the directive; introduces simplified requirements for investment firms and competent authorities to assess the adequacy of arrangements and procedures to ensure that firms comply with the provisions of the Directive; gives competent authorities the power to review and evaluate the prudential status of investment firms and to request, where appropriate, changes in areas such as governance and internal controls, risk management processes and procedures and, where necessary, set additional requirements, including capital and liquidity requirements; revise the rules on corporate governance and remuneration to prevent excessive risk taking by the staff of investment firms; however, small, non-interconnected investment firms would be exempt from these rules. The proposal requires investment firms to establish appropriate ratios between variable and fixed components of remuneration. In addition, it sets a threshold at firm and staff levels below which investment firms and/or staff members will benefit from the derogations from the application of the rules on the deferral and pay-out in instruments; provides for the possibility for the Union to conclude agreements with third countries regarding the means of supervising compliance with the group capital test. Administrative cooperation arrangements with third countries supervisory authorities may be concluded by the Member States and EBA to facilitate the exchange of information.
DELEGATED ACTS: the proposal contains provisions empowering the Commission to adopt delegated acts in accordance with Article 290 of the Treaty on the Functioning of the European Union.
Documents
Documents
- Final act published in Official Journal: Directive 2019/2034
- Final act published in Official Journal: OJ L 314 05.12.2019, p. 0064
- Final act published in Official Journal: Corrigendum to final act 32019L2034R(02)
- Final act published in Official Journal: OJ L 405 02.12.2020, p. 0084
- Draft final act: 00079/2019/LEX
- Contribution: COM(2017)0791
- Commission response to text adopted in plenary: SP(2019)440
- Results of vote in Parliament: Results of vote in Parliament
- Decision by Parliament, 1st reading: T8-0377/2019
- Debate in Parliament: Debate in Parliament
- Approval in committee of the text agreed at 1st reading interinstitutional negotiations: PE637.298
- Approval in committee of the text agreed at 1st reading interinstitutional negotiations: GEDA/A/(2019)002699
- Coreper letter confirming interinstitutional agreement: GEDA/A/(2019)002699
- Committee report tabled for plenary, 1st reading: A8-0295/2018
- European Central Bank: opinion, guideline, report: CON/2018/0036
- European Central Bank: opinion, guideline, report: OJ C 378 19.10.2018, p. 0005
- Committee opinion: PE621.063
- Amendments tabled in committee: PE623.597
- Committee draft report: PE619.409
- Contribution: COM(2017)0791
- Contribution: COM(2017)0791
- Contribution: COM(2017)0791
- Follow-up document: EUR-Lex
- Follow-up document: SWD(2017)0481
- Legislative proposal: COM(2017)0791
- Legislative proposal: EUR-Lex
- Legislative proposal: COM(2017)0791 EUR-Lex
- Follow-up document: EUR-Lex SWD(2017)0481
- Committee draft report: PE619.409
- Amendments tabled in committee: PE623.597
- Committee opinion: PE621.063
- European Central Bank: opinion, guideline, report: CON/2018/0036 OJ C 378 19.10.2018, p. 0005
- Coreper letter confirming interinstitutional agreement: GEDA/A/(2019)002699
- Commission response to text adopted in plenary: SP(2019)440
- Draft final act: 00079/2019/LEX
- Contribution: COM(2017)0791
- Contribution: COM(2017)0791
- Contribution: COM(2017)0791
- Contribution: COM(2017)0791
Activities
- Valdis DOMBROVSKIS
- Mady DELVAUX
Plenary Speeches (1)
- Notis MARIAS
Plenary Speeches (1)
Votes
A8-0295/2018 - Markus Ferber - Am 2 16/04/2019 12:34:55.000 #
2019/04/16 Outcome: +: 534, -: 63, 0: 55
NI
GUE/NGL
EFDDA8-0295/2018 - Markus Ferber - Am 2 #
2019/04/16 Outcome: +: 534, -: 63, 0: 55
| Amendments | Dossier |
| 276 |
2017/0358(COD)
2018/06/04
ECON
192 amendments...
Amendment 100 #
Proposal for a directive Article 28 – paragraph 4 – subparagraph 1 EBA, in c
Amendment 101 #
Proposal for a directive Article 28 – paragraph 4 – subparagraph 2 E
Amendment 102 #
Proposal for a directive Article 29 – paragraph 1 – introductory part Member States shall ensure that where an investment firm benefits from extraordinary public financial support as defined to in Article 2(1)(28) of Directive 2014/59/EU,
Amendment 103 #
Proposal for a directive Article 29 – paragraph 1 – introductory part Member States shall ensure that where an investment firm benefits from extraordinary public financial support as defined to in Article 2(1)(28) of Directive 2014/59/EU, the
Amendment 104 #
Proposal for a directive Article 29 – paragraph 1 – point a Amendment 105 #
Proposal for a directive Article 29 – paragraph 1 – point a Amendment 106 #
Proposal for a directive Article 29 – paragraph 1 – point b Amendment 107 #
Proposal for a directive Article 29 – paragraph 1 – point b Amendment 108 #
Proposal for a directive Article 29 – paragraph 1 – point c Amendment 109 #
Proposal for a directive Article 29 – paragraph 1 – point c Amendment 110 #
Proposal for a directive Article 29 – paragraph 1 – point c (c) the investment firm shall only pay variable remuneration to members of the management body of the investment firm where such remuneration has been approved by the competent authority and when the extraordinary public financial support comes to an end.
Amendment 111 #
Proposal for a directive Article 29 – paragraph 2 Amendment 113 #
Proposal for a directive Article 30 – paragraph 1 – introductory part 1. Member States shall ensure that any variable remuneration awarded and paid by an investment firm to those categories of staff, including senior management, risk takers, control functions and any employee receiving total remuneration that falls within the remuneration bracket of senior management and risk takers whose professional activities have a material impact on the risk profiles of the firm or of the assets that it manages complies with all of the following requirements:
Amendment 114 #
Proposal for a directive Article 30 – paragraph 1 – introductory part 1. When establishing and applying the remuneration policy referred to in this article, Member States shall ensure that any variable remuneration awarded and paid by an investment firm complies with all of the following requirements in a way and to the extent that is appropriate to their size, internal organisation and the nature, scope and complexity of their activities:
Amendment 115 #
Proposal for a directive Article 30 – paragraph 1 – introductory part 1. Member States shall ensure that any variable remuneration awarded and paid by an investment firm to persons in decision making capacities complies with all of the following requirements:
Amendment 116 #
Proposal for a directive Article 30 – paragraph 1 – point a (a) where variable remuneration is performance related, the total amount of variable remuneration shall be based on a combination of the assessment of the performance of the individual, regardless of the gender, of the business unit concerned and of the overall results of the investment firm;
Amendment 117 #
Proposal for a directive Article 30.º – paragraph 1 – point a a (new) (aa) Variable remuneration may not exceed fixed remuneration on an annual basis;
Amendment 118 #
Proposal for a directive Article 30 – paragraph 1 – point j – introductory part (j) at least 35
Amendment 119 #
Proposal for a directive Article 30 – paragraph 1 – point j – point 3 a (new) (3a) Non-listed investment firms which may not be in a situation to pay any part of variable compensation in instruments as prescribed above may instead include an ad hoc firm level solvency and financial performance payment criteria in their differed compensation scheme.
Amendment 120 #
Proposal for a directive Article 30 – paragraph 1 – point j – point 3 a (new) (3a) Non-listed investment firms which may not be in a situation to pay any part of variable compensation in instruments as prescribed above may include an ad hoc firm level solvency and financial performance payment criteria in their differed compensation scheme.
Amendment 121 #
Proposal for a directive Article 30 – paragraph 1 – point j a (new) (ja) as a derogation from point (j) in case an investment firm does not issue any of those instruments, national competent authorities can approve the use of alternative arrangements fulfilling the same objectives;
Amendment 122 #
Proposal for a directive Article 30 – paragraph 1 – point k (k) at least
Amendment 123 #
Proposal for a directive Article 30 – paragraph 1 – point k (k) at least
Amendment 124 #
Proposal for a directive Article 30 – paragraph 1 – point k (k) at least 40% of the variable remuneration shall be deferred over a
Amendment 125 #
Proposal for a directive Article 30 – paragraph 4 – subparagraph 1 – point a (a) an investment firm, the
Amendment 126 #
Proposal for a directive Article 30 – paragraph 6 – subparagraph 1 E
Amendment 127 #
Proposal for a directive Article 30 – paragraph 6 – subparagraph 1 EBA, in c
Amendment 128 #
Proposal for a directive Article 30 – paragraph 6 – subparagraph 2 E
Amendment 129 #
Proposal for a directive Article 30 – paragraph 7 Amendment 130 #
Proposal for a directive Article 30 – paragraph 7 7. E
Amendment 131 #
Proposal for a directive Article 30 – paragraph 7 7. EBA, in c
Amendment 132 #
Proposal for a directive Article 31 Amendment 133 #
Proposal for a directive Article 31 – paragraph 1 1. Member States shall ensure that competent authorities have the necessary powers to guarantee that investment firms which
Amendment 134 #
Proposal for a directive Article 31 – paragraph 2 2. Member States shall ensure that competent authorities have the necessary powers to guarantee that the remuneration committee is responsible for the
Amendment 135 #
Proposal for a directive Article 31 – paragraph 3 3. When preparing the decisions referred to in paragraph 2, the remuneration committee shall take into account the public interest and the long- term interests of shareholders, investors and other stakeholders in the investment firm and ensure that the remuneration policy decisions are gender neutral.
Amendment 136 #
Proposal for a directive Article 32 Amendment 137 #
Proposal for a directive Article 32 – paragraph 1 1. Member States shall ensure that competent authorities collect the information disclosed in accordance with points (a), (b), (ba), (c), (d) and (f) of Article 51 of [Regulation (EU) ---/----[IFR] and use that information to benchmark remuneration trends and practices. Competent authorities shall provide that information to
Amendment 138 #
Proposal for a directive Article 32 – paragraph 3 3. EBA, in consultation with ESMA, shall issue guidelines on the application of
Amendment 139 #
Proposal for a directive Article 32 – paragraph 3 3. EBA, in c
Amendment 14 #
Proposal for a directive Recital 4 (4) Many of the requirements that stem from Regulation (EU) No 575/2013 and Directive 2013/36/EU framework are designed to address common risks faced by credit institutions. Accordingly, the existing requirements are largely calibrated to preserve the lending capacity of credit institutions through economic cycles and to protect depositors and taxpayers from possible failure, and are not designed to address the different risk-profiles of investment firms. Investment firms do not have large portfolios of retail and corporate loans and do not take deposits. The likelihood that their failure can have detrimental impacts for overall financial stability is lower than in the case of credit institutions, but they still pose a risk which has to be addressed through a robust framework. The risks faced and posed by investment firms are thus substantially different to the risks faced and posed by credit institutions and such difference should be clearly reflected in the prudential framework of the Union.
Amendment 140 #
Proposal for a directive Article 32 – paragraph 4 4. Member States shall ensure that investment firms provide competent authorities, where requested, with information on the number of natural persons per investment firm that are remunerated EUR 1 million or more per financial year, in pay brackets of EUR 1 million, including information on their job responsibilities, the business area involved and the main elements of salary, bonus, long-term award and pension contribution. Competent authorities shall forward that information to EBA, which shall publish it on an aggregate home Member State basis in a common reporting format. EBA, in c
Amendment 141 #
Proposal for a directive Article 32 – paragraph 4 a (new) 4a. The Commission shall ensure that Member States respect and enforce the remuneration policies. It shall also ensure a consistent implementation across the EU in order to avoid arbitrage.
Amendment 142 #
Proposal for a directive Article 33 – paragraph 1 – point b (b) the geographical location as well as the sustainable nature of an investment firm’s exposures;
Amendment 143 #
Proposal for a directive Article 33 – paragraph 1 – point c a (new) (ca) the exposure of the investment firm to balance sheet and off-balance sheet exposures not covered by own funds requirements as defined in Article 9 IFR;
Amendment 144 #
Proposal for a directive Article 33 – paragraph 1 – point f (f) governance arrangements and gender policy of investment firms and the ability of members of the management body to perform their duties.
Amendment 145 #
Proposal for a directive Article 33 – paragraph 1 – point f a (new) (fa) the risks posed to the security of network and information systems which investment firms use in their operations to ensure confidentiality, integrity and availability of its processes and data.
Amendment 146 #
Proposal for a directive Article 33 – paragraph 1 – point f a (new) (fa) the integration of environmental, social and governance (ESG) factors and risks in the firm’s risk-management system and the exposure of investments firms to environmental risks.
Amendment 147 #
Proposal for a directive Article 33 – paragraph 1 – point f a (new) (fa) the inclusive consideration of risks related to environmental, social and governance (ESG) factors in the risk- mitigating arrangements of the investment firms.
Amendment 148 #
Proposal for a directive Article 33 – paragraph 2 2. Member States shall ensure that competent authorities establish the frequency and intensity of the review and evaluation referred to in paragraph 1 having regard to the size, systemic importance, nature, scale and complexity of the activities of the investment firms concerned and taking into account the principle of proportionality. Competent authorities shall perform the review under paragraph 1 with respect to firms meeting the conditions set out in Article 12(1) of [Regulation (EU) ---/----[IFR] only where they decide that the size, systemic importance, nature, scale and complexity of the activities of these firms require that review.
Amendment 149 #
Proposal for a directive Article 33 – paragraph 2 2. Member States shall ensure that competent authorities establish the frequency and intensity of the review and evaluation referred to in paragraph 1 having regard to the size, systemic importance, nature, scale and complexity of the activities of the investment firms concerned and taking into account the principle of proportionality. The review and evaluation shall be updated at least on an annual basis for the investment firms that do not meet all of the conditions set out in that Article 12(1) of [Regulation (EU) ---/----[IFR].
Amendment 15 #
Proposal for a directive Recital 4 (4) Many of the requirements that stem
Amendment 150 #
Proposal for a directive Article 33 – paragraph 5 5. When conducting the review and evaluation referred to in
Amendment 151 #
Proposal for a directive Article 33 – paragraph 6 a (new) 6a. For the purpose of point (g) the EBA shall by 1 June 2020 issue guidelines in accordance with Article 16 of Regulation (EU) No 1093/2010 to specify a methodology for the supervisory review and evaluation process regarding the integration of ESG factors and risks in the firm’s risk-management system. Such guidelines shall inter alia specify qualitative and quantitative criteria and metrics for the definition and the assessment of exposures to climate- change and environmental risks and in particular risks related to the depreciation of assets due to climate related regulatory changes. These guidelines shall take explicit account of the classification of activities contributing substantially or significantly harming environmental objectives and the methodology for identifying the percentage of assets funding environmentally sustainable economic activities as provided for in the Regulation [Regulation (EU) ---/---- [taxonomy], establishing a framework to facilitate sustainable investments.
Amendment 152 #
Proposal for a directive Article 33 – paragraph 6 b (new) 6b. Taking into account the experience acquired in the application of the guidelines referred to in paragraph 7, EBA shall develop and update every two years thereafter draft regulatory technical standards to specify and update the methodology referred to in paragraph 7. EBA shall submit those draft regulatory technical standards to the Commission by 1 July 2021. Power is conferred on the Commission to adopt the regulatory technical standards referred to in the first subparagraph in accordance with Articles 10 to 14 of Regulation (EU) No 1093/2010.
Amendment 153 #
Proposal for a directive Article 34 – paragraph 2 2. Where, for internal risk-to-market models, numerous overshootings as referred to in Article 366 of Regulation (EU) No 575/2013 indicate that the models are not or are no longer accurate, competent authorities shall revoke the permission to use the internal models or impose appropriate measures to ensure that the models are improved promptly and within a set timeframe.
Amendment 154 #
Proposal for a directive Article 35 – paragraph 1 – point b a (new) (ba) In case the total value of the assets of an undertaking is below EUR 30 billion and the undertaking is part of a third-country global systemically important institution (G-SII), the supervisory responsibility for that undertaking shall be transferred from the national competent authority to the SSM.
Amendment 155 #
Proposal for a directive Article 36 – paragraph 1 1. Member States shall ensure that competent authorities have the necessary supervisory powers to intervene in the exercise of their functions into the activity of investment firms in a proportionate way.
Amendment 156 #
Proposal for a directive Article 36 – paragraph 2 – subparagraph 1 – point b (b) to require the reinforcement of the arrangements, processes, mechanisms and strategies implemented in accordance with Articles 22, 22a and 24;
Amendment 157 #
Proposal for a directive Article 36 – paragraph 2 – subparagraph 1 – point c (c) to require investment firms to present a plan to comply with supervisory requirements pursuant to this Directive and to [Regulation (EU) ---/----[IFR], to set a deadline which shall not exceed one year for the implementation of that plan and require improvements to that plan regarding scope and deadline;
Amendment 158 #
Proposal for a directive Article 36 – paragraph 2 – subparagraph 1 – point g (g) to require investment firms to
Amendment 159 #
Proposal for a directive Article 36 – paragraph 2 – subparagraph 1 – point l (l) to require additional disclosures
Amendment 16 #
Proposal for a directive Recital 7 (7) There may be Member States in which the authorities competent for the prudential supervision of investment firms are different from the authorities that are competent for the supervision of market conduct. It is therefore necessary to create a mechanism
Amendment 160 #
Proposal for a directive Article 36 – paragraph 2 – subparagraph 1 – point l a (new) (la) to require investment firms to reduce risks posed to the security of their network and information systems to ensure confidentiality, integrity and availability of the processes and data.
Amendment 161 #
Proposal for a directive Article 36 – paragraph 2 – subparagraph 2 – point b a (new) (ba) the additional information is required for the duration of the institution’s supervisory review and evaluation process as referred to in Article 33.
Amendment 162 #
Proposal for a directive Article 36 – paragraph 2 – subparagraph 3 Amendment 163 #
1. Competent authorities shall impose the additional capital requirement referred to in Article 36(2)(a)
Amendment 164 #
Proposal for a directive Article 37 – paragraph 1 – point a (a) the investment firm is exposed to risks or elements of risks that are not covered or not sufficiently covered by the capital requirement set out in Part Three of [Regulation (EU) ---/----[IFR], especially taking into account risks in relation to environmental, social and governance (ESG) factors;
Amendment 165 #
Proposal for a directive Article 37 – paragraph 1 – point e (e) the investment firm
Amendment 166 #
Proposal for a directive Article 37 – paragraph 1 – point e (e) the investment firm
Amendment 167 #
Proposal for a directive Article 37 – paragraph 2 – subparagraph 1 For the purpose of paragraph 1(a), risks or elements of risk shall only be considered as not covered or not sufficiently covered by the capital requirement set out in Part Three of [Regulation (EU) ---/----[IFR] where the
Amendment 168 #
Proposal for a directive Article 37 – paragraph 2 – subparagraph 1 For the purpose of paragraph 1(a), risks or elements of risk shall
Amendment 169 #
Proposal for a directive Article 37 – paragraph 2 – subparagraph 2 Amendment 17 #
Proposal for a directive Recital 10 – point 1 Amendment 170 #
Proposal for a directive Article 37 – paragraph 2 – subparagraph 2 Amendment 171 #
Proposal for a directive Article 37 – paragraph 4 – subparagraph 1 (new) Competent authorities may require institutions to meet the additional own funds requirements referred to in Article 36(2)(a) with CET 1 capital.
Amendment 172 #
Proposal for a directive Article 37 – paragraph 5 5. Competent authorities shall
Amendment 173 #
Proposal for a directive Article 37 – paragraph 6 Amendment 174 #
Proposal for a directive Article 37 – paragraph 6 – subparagraph 1 – introductory part EBA, in c
Amendment 175 #
Proposal for a directive Article 38 – paragraph 1 – point a (a) cyclical economic fluctuations do not lead to a breach of those requirements; and
Amendment 176 #
Proposal for a directive Article 38 – paragraph 2 2. Competent authorities shall regularly review the level of capital that has been set by each investment firm in accordance with paragraph 1 and, where relevant, communicate the conclusions of that review to the investment firm concerned, including any expectation for adjustments to the level of capital established in accordance with paragraph 1. Such a communication shall include the date by which the competent authority requires the adjustment to be completed.
Amendment 177 #
Proposal for a directive Article 38 – paragraph 2 a (new) Amendment 178 #
Proposal for a directive Article 38 – paragraph 2 a (new) 2a. If the competent authority determines that the investment firm remains inactive over a period of six months after the additional capital requirements have been determined by the competent authority these requirements shall become binding level 1 requirements.
Amendment 179 #
Proposal for a directive Article 39 – paragraph 1 1. Competent authorities shall consult resolution authorities prior to determining any additional capital required pursuant to Article 36(2)(a) and prior to communicating to investment firms
Amendment 18 #
Proposal for a directive Recital 11 (11) The proper functioning of the internal market requires that the responsibility for supervising the financial soundness of an investment firm, and in particular its solvency and its financial soundness, lies with the competent authority of its home Member State or, in case the Member State does not possess a competent authority with the characteristics laid down in this Directive, with the competent authority that the Member State should create for the purpose of this Directive. To achieve an effective supervision
Amendment 180 #
Proposal for a directive Article 39 – paragraph 2 2. Competent authorities shall inform the relevant resolution authorities about the additional capital required pursuant to Article 36(2)(a) and about
Amendment 181 #
Proposal for a directive Article 40.º – paragraph 1 – point b (b) require investment firms to use specific media and locations and in particular their internet sites for publications other than the financial statements;
Amendment 182 #
Proposal for a directive Article 41 – paragraph 2 – subparagraph 3 a (new) Taking into account the experience acquired in the application of the guidelines referred to in paragraph 2, EBA shall develop draft regulatory technical standards to specify the common procedures and methodologies for the supervisory review and evaluation process referred to in paragraph 1 and the assessment of the treatment of the risks referred to in Article 27. EBA shall submit those draft regulatory technical standards to the Commission by 1 July 2021. Power is conferred on the Commission to adopt the regulatory technical standards referred to in the first subparagraph in accordance with Articles 10 to 14 of Regulation (EU) No 1093/2010
Amendment 183 #
Proposal for a directive Article 44 – paragraph 8 – subparagraph 1 EBA shall, in c
Amendment 184 #
Proposal for a directive Article 46 – paragraph 2 – subparagraph 1 – point c (c) request an auditor or expert to carry out the verification promptly and as impartially as possible in order to possess a third-party assessment.
Amendment 185 #
Proposal for a directive Article 51 – paragraph 3 a (new) 3a. When an investment firm established in the Union is part of a third country group whose subsidiaries and branches in the Union also comprise other investment firms, or AIFMs as defined in Article 2(1) of Directive 2011/61/EU, or management companies as defined in Article 2 (1b) of Directive 2009/65/EC, Member States shall require the formation of an intermediate EU parent undertaking that is established in the Union, unless such an intermediate parent already exists.
Amendment 186 #
Proposal for a directive Article 51 – paragraph 3 b (new) 3b. Member States shall require an intermediate EU parent undertaking in the Union to obtain authorisation as a financial holding company, or as an investment holding company, or as a mixed financial holding company as defined in point (15) of Article 2 of Directive 2002/87/EC.
Amendment 187 #
Proposal for a directive Article 51 – paragraph 3 c (new) 3c. Paragraphs 3a and 3b shall not apply where the volume of client assets under management in the Union of the third country group is lower than EUR 100 billion, unless the third country group is a non-EU G-SII.
Amendment 188 #
Proposal for a directive Article 51 – paragraph 3 d (new) 3d. For the purposes of paragraphs 3a, 3b and 3c, the total value of assets in the Union of the third country group shall include the following: (a) the total assets of each institution in the Union of the third country group, as resulting from their consolidated balance sheet; and (b) the total assets of each branch of the third country group authorised in the Union.
Amendment 189 #
Proposal for a directive Article 51 – paragraph 3 e (new) 3e. Competent authorities shall inform ESMA and EBA about every authorisation granted pursuant to paragraph 5.
Amendment 19 #
Proposal for a directive Recital 14 (14) To strengthen the prudential supervision of investment firms and the protection of clients of investment firms, auditors should report promptly and as impartially as possible to the competent authorities those facts which can have a serious effect on the financial situation of an investment firm or its administrative and accounting organisation.
Amendment 190 #
Proposal for a directive Article 51 – paragraph 3 f (new) 3f. ESMA shall publish on its website the list of all intermediate EU parent undertakings that have been granted authorisation in the Union. Competent authorities shall ensure that there is a single intermediate EU parent undertaking for all institutions that are part of the same third country group.
Amendment 191 #
Proposal for a directive Article 57 – paragraph 1 – point 2 Directive 2013/36/EU Article 1 – point c (c) the prudential supervision of credit institutions and certain investment firms referred to in Article 2(2) by competent authorities in a manner that is consistent with the rules set out in Regulation (EU) No 575/2013;
Amendment 192 #
Proposal for a directive Article 57 – paragraph 1 – point 2 Directive 2013/36/EU Article 1 – point c (c) the prudential supervision of credit institutions and investment firms referred in Article 2(2) by competent authorities in a manner that is consistent with the rules set out in Regulation (EU) No 575/2013;
Amendment 193 #
Proposal for a directive Article 57 – paragraph 1 – point 3 – point b Directive 2013/36/EU Article 2 – paragraphs 2 and 3 (b) paragraphs 2 and 3 are
Amendment 194 #
Proposal for a directive Article 57 – paragraph 1 – point 3 – point b Directive 2013/36/EU Article 2 – paragraphs 2 and 3 (b) paragraphs 2 and 3 are
Amendment 195 #
Proposal for a directive Article 57 – paragraph 1 – point 6 Directive 2013/36/EU Article 8a – paragraph 4 a (new) 4a. In case of re-authorisation, EBA shall ensure that the process is as streamlined as possible and information from existing authorisations is taken into account.
Amendment 196 #
Proposal for a directive Article 58 – paragraph 1 – point 3 Directive 2014/65/EU Article 41 – paragraph 2 – subparagraph 1 The branch of the third-country firm authorised in accordance with paragraph 1, shall comply with the obligations laid down in Articles 16 to 20, 23, 24, 25 and 27, Article 28(1), and Articles 30, 31 and 32 of this Directive and in Articles 3 to 2
Amendment 197 #
Proposal for a directive Article 58 – paragraph 1 – point 3 Directive 2014/65/EU Article 41 – paragraph 2 – subparagraph 1 The branch of the third-country firm authorised in accordance with paragraph 1, shall comply with the obligations laid down in Articles 16 to 20, 23, 24, 25 and 27, Article 28(1), and Articles 30, 31 and 32 of this Directive and in Articles 3 to 2
Amendment 198 #
Proposal for a directive Article 58 – paragraph 1 – point 3 a (new) Directive 2014/65/EU Article 42 (3a) Article 42 is replaced by the following: “Article 42 Provision of services at the exclusive initiative of the client 1. Member States shall ensure that where a retail client or professional client within the meaning of Section II of Annex II established or situated in the Union initiates at its own exclusive initiative the provision of an investment service or activity by a third-country firm, the requirement for authorisation under Article
Amendment 199 #
Proposal for a directive Article 58 – paragraph 1 – point 3 a (new) Directive 2014/65/EU Article 42 (3a) Article 42 is replaced by the following: “Article 42 Provision of services at the exclusive initiative of the client 1. Member States shall ensure that where a retail client or professional client within the meaning of Section II of Annex II established or situated in the Union initiates at its own exclusive initiative the provision of an investment service or activity by a third-country firm, the requirement for authorisation under Article 39 shall not apply to the provision of that service or activity by the third country firm to that person including a relationship specifically relating to the provision of that service or activity.
Amendment 20 #
Proposal for a directive Recital 18 a (new) (18a) The asset management sector has grown strongly in recent years in terms of assets under management. It has also experienced strong concentration as a small number of firms have become much larger than their competitors. This has increased the potential for systemic risk emanating from the activities of investment firms, e.g. the risks from liquidity mismatches between investment firms’ investment assets and the redemption terms granted to their customers. Recent work conducted by the Financial Stability Board and the International Organization of Securities Commissions is contributing to the understanding of those risks, but has not yet progressed enough to be translated into comprehensive macroprudential regulation and supervision. Where appropriate, this Directive integrates certain recommendations from this evolving body of work, but leaves the elaboration of a comprehensive framework to the mandatory review three years after the entering into force of this Directive.
Amendment 200 #
Proposal for a directive Article 58 a (new) Directive 2014/59/EU Article 2 – paragraph 1 – point 3 Article 58a (new) Amendment to Directive 2014/59/EU in Article 2(1), point (3) is replaced by the following: “(3) ‘investment firm’ means an investment firm as defined in point (2) of Article 4(1) of Regulation (EU) No 575/2013 that is subject to the initial capital requirement laid down in Article
Amendment 201 #
Proposal for a directive Article 60 – paragraph 1 – introductory part By [three years after the date of application of this Directive and Regulation (EU) ---/-- --[IFR]] and every three years thereafter, the Commission, in close cooperation with EBA, ESRB and ESMA, shall submit a report, together with a legislative proposal if appropriate, to the European Parliament and to the Council, on the following:
Amendment 202 #
Proposal for a directive Article 60 – paragraph 1 – point a (a) the provisions on remuneration in this Directive and in Regulation (EU) ---/-- -- [IFR] as well as in UCITS and AIFMD with the aim to achieve a level playing field for all investment firms active in the Union;
Amendment 203 #
Proposal for a directive Article 60 – paragraph 1 – point d a (new) (da) the need to develop appropriate macroprudential tools to address the build-up and the materialisation of systemic risks, including liquidity mismatch risk and leverage in the investment industry. The Commission should pay close attention to ongoing work at the Financial Stability Board and International Organization of Securities Commissions and translate those principles into EU law.
Amendment 204 #
Proposal for a directive Article 60 – paragraph 1 – point d b (new) (db) the potential systemic impact of the three classes of investment firms and the necessity to tailor the macroprudential perspective to the specificities of investment firms’ business models.
Amendment 205 #
Proposal for a directive Article 60 – paragraph 1 a (new) By [5 years from the date of application of this Directive] and subsequently every 3 years, the Commission shall submit to the European Parliament and the Council a report on the application of this Directive and its impacts.
Amendment 21 #
Proposal for a directive Recital 20 (20) To align remuneration with the risk profile of investment firms and to guarantee a level-playing field, investment firms should be subject to clear principles on corporate governance arrangements and rules on remuneration that take into account the differences between credit institutions and investment firms.
Amendment 22 #
Proposal for a directive Recital 20 (20) To align remuneration with the risk profile of investment firms and to guarantee a level-playing field, investment firms should be subject to clear principles on corporate governance arrangements and rules on remuneration that are gender neutral and that take into account the differences between credit institutions and investment firms. Small and non- interconnected investment firms should however be exempted from those rules because the provisions on remuneration and corporate governance under Directive 2014/65/EU are
Amendment 23 #
Proposal for a directive Recital 22 (22) It is also appropriate to offer some flexibility to investment firms in the way they use non-cash instruments when paying variable remuneration, as long as such instruments are effective in achieving the objective of aligning the interest of staff with the interest of various stakeholders, such as shareholders and creditors, and contribute to the alignment of variable remuneration with the risk profile of the investment firm. However, the ratio between the fixed and variable component should never be less than 1.
Amendment 24 #
Proposal for a directive Recital 23 Amendment 25 #
Proposal for a directive Recital 23 (23) The revenues of investment firms in the form of fees, commissions and other revenues in relation to the provision of different investment services are highly volatile. Limiting the variable component of remuneration to a portion of the fixed component of remuneration would affect the firm’s ability to reduce remuneration at times of reduced revenues and could lead to an increase of the firm’s fixed cost base, leading in turn to risks for the firm’s ability to withstand times of economic downturn or reduced revenues. To avoid those risks, a single maximum ratio between the variable and the fixed elements of remuneration should not be imposed on non-systemic investment firms.
Amendment 26 #
Proposal for a directive Recital 24 Amendment 27 #
Proposal for a directive Recital 24 (24) In response to the growing public demand for tax transparency and to promote investment firms’ corporate responsibility, it is appropriate to require that investment firms, unless they qualify as small and non-interconnected, disclose certain information, including information on profits made, taxes paid and any public subsidies received.
Amendment 28 #
Proposal for a directive Recital 24 (24) In response to the growing public demand for tax transparency and to promote investment firms’ corporate responsibility, it is
Amendment 29 #
Proposal for a directive Recital 24 a (new) (24a) While the requirements based on the K-factors largely stem from the market risk rules, their design in [Regulation (EU) ---/----[IFR] does not cover their full scope as in Regulation (EU) No 575/2013. In particular, the provisions set out in Title 4 in Part Three of Regulation (EU) No 575/2013 (the market risk rules) also apply to positions outside the prudential trading book. In order to mitigate for this difference in scopes, not driven by a difference in risks, the general prudential requirements laid down in [Regulation (EU)---/----[IFR]are supplemented by individual arrangements to be decided by the competent authorities as a result of the ongoing supervisory review of each individual investment firm as regards positions outside the trading book.
Amendment 30 #
Proposal for a directive Article 3 – paragraph 1 – point 20 a (new) (20a) ‘large asset manager’ is a group of individual undertakings belonging to a financial holding company, or as an investment holding company, or as a mixed financial holding company that together have over EUR 100 billion client assets under management, and that comprises at least one investment firm and any number of AIFMs as defined in Article 2(1) of Directive 2011/61/EU, or management companies as defined in Article 2(1b) of Directive 2009/65/EC;
Amendment 31 #
Proposal for a directive Article 3 – paragraph 1 – point 20 b (new) (20b) ‘third country large asset manager’ is an intermediate EU parent undertaking subject to the requirements of Article 51(4);
Amendment 32 #
Proposal for a directive Article 3 – paragraph 1 – point 20 c (new) (20c) ‘liquidity mismatch’ means the possible mismatch between the liquidity of a fund’s investment assets and the redemption terms for fund units. Under certain conditions, especially when securities markets are stressed and/or when many fund clients want to redeem their shares at the same time (redemption run scenario), such mismatches can cause financial instability and contagion as funds find it difficult to liquidate investment assets quickly in an already adverse market;
Amendment 33 #
Proposal for a directive Article 4 – paragraph 1 1. Member States shall designate one or more competent authorities that carry out the functions and duties provided for in this Directive. The Member States shall inform the Commission, EBA and E
Amendment 34 #
Proposal for a directive Article 4 – paragraph 4 4. Member States shall ensure that the competent authorities have the expertise, resources, operational capacity, powers and political independence necessary to carry out the functions relating to the prudential supervision, investigations and penalties set out in this Directive.
Amendment 35 #
Proposal for a directive Article 5 – paragraph 1 1. Competent authorities shall cooperate closely with the public authorities or bodies responsible in their Member State for the supervision of credit institutions and financial institutions. Member States shall require that those competent authorities and those public authorities or bodies exchange, without delay, any information which is essential or relevant to the exercise of their functions and duties.
Amendment 36 #
Proposal for a directive Article 7 – paragraph 1 Competent authorities in each Member State shall, in the exercise of their general duties, duly consider the potential impact of their decisions on the stability of the financial system in
Amendment 37 #
Proposal for a directive Article 8 a (new) Amendment 38 #
Proposal for a directive Article 8 a (new) Article 8a Indemnity Insurance All investment firms providing services under this Directive are required to have a professional indemnity insurance.
Amendment 39 #
Proposal for a directive Article 11 – paragraph 6 – subparagraph 1 EBA, in c
Amendment 40 #
Proposal for a directive Article 11 – paragraph 7 – subparagraph 1 EBA, in c
Amendment 41 #
Proposal for a directive Article 16 – paragraph 1 – subparagraph 1 – point h (h) an investment firm is found liable for a
Amendment 42 #
Proposal for a directive Article 16 – paragraph 1 – subparagraph 3 The administrative penalties and other administrative measures shall be effective, proportionate and dissuasive and Member States shall apply a harmonised set of penalties for similar offences to avoid treaty shopping.
Amendment 43 #
Proposal for a directive Article 16 – paragraph 1 – subparagraph 3 The administrative penalties and other administrative measures shall be effective, proportionate and dissuasive and shall as far as possible be at levels comparable to the ones in other Member States.
Amendment 44 #
Proposal for a directive Article 16 – paragraph 2 – subparagraph 1 – point d (d) in case of a legal person, administrative pecuniary penalties of up to 1
Amendment 45 #
Proposal for a directive Article 16 – paragraph 2 – subparagraph 1 – point e (e) in the case of a legal person, administrative pecuniary penalties of up to t
Amendment 46 #
Proposal for a directive Article 17 – paragraph 1 – point b – point iv (iv) to interview any other
Amendment 47 #
Proposal for a directive Article 18.º – paragraph 1 1. Member States shall ensure that competent authorities publish on their official website any administrative penalties and measures imposed in accordance with Article 16 and which has not been appealed or can no longer be appealed, without undue delay. That publication shall include information on the type and nature of the breach and the identity of the natural or legal person on whom the penalty is imposed or against whom the measure is taken.
Amendment 48 #
Proposal for a directive Article 18 – paragraph 1 1. Member States shall ensure that competent authorities publish on their official website any administrative penalties and measures imposed in accordance with Article 16 and which has not been appealed or can no longer be appealed, without undue delay. That publication shall include information on the type and nature of the breach and the identity of the natural or legal person on whom the penalty is imposed or against whom the measure is taken. The
Amendment 49 #
Proposal for a directive Article 18 – paragraph 2 2. Where Member States permit the publication of administrative penalties or measures imposed in accordance with Article 16 against which there has been an appeal, competent authorities shall also publish on their official website information on the appeal status and on the outcome of the appeal. Competent authorities shall ensure that the same information is published on the official website of the investment firm concerned.
Amendment 50 #
Proposal for a directive Article 18.º – paragraph 3 Amendment 51 #
Proposal for a directive Article 19 – paragraph 1 Competent authorities shall inform EBA of administrative penalties and measures imposed pursuant to Article 16, of any appeal against those penalties and measures and of the outcome thereof. EBA shall maintain a central database of administrative penalties and measures communicated to it solely for the purpose of exchanging information between competent authorities. That database shall be accessible to competent authorities
Amendment 52 #
Proposal for a directive Article 20 – paragraph 1 – introductory part 1. Member States shall ensure that competent authorities establish effective and reliable mechanisms to, without delay, report potential or actual breaches of national provisions transposing this Directive and of [Regulation (EU) ---/---- [IFR], including the following:
Amendment 53 #
Proposal for a directive Article 22 – paragraph 2 a (new) 2a. Competent Authorities shall be empowered to review regularly the strategies and processes under paragraph 1 applied by the investment firms and to make changes when deemed necessary.
Amendment 54 #
Proposal for a directive Title 4 – chapter 2 – section 1 a (new) Amendment 55 #
Proposal for a directive Article 23.º – paragraph 2 Amendment 56 #
Proposal for a directive Article 23 – paragraph 2 2. This Section, with the exception of Articles 25, 28(2) and Article 30, shall not apply where, on the basis of the assessment referred to in paragraph 1, an investment firm determines that it meets all of the conditions set out in Article 12(1) of [Regulation
Amendment 57 #
Proposal for a directive Article 23 – paragraph 2 – subparagraph 1 (new) By way of derogation from the first subparagraph, competent authorities may require an investment firm that meets all of the conditions set out in Article 12(1) of [Regulation (EU) ---/----[IFR] to apply totally or partially the requirements of this Section.
Amendment 58 #
Proposal for a directive Article 23.º – paragraph 3 Amendment 59 #
Proposal for a directive Article 23 – paragraph 5 – introductory part 5. Competent authorities
Amendment 60 #
Proposal for a directive Article 23 – paragraph 6 – subparagraph 1 EBA, in c
Amendment 61 #
Proposal for a directive Article 24 – paragraph 4 4. EBA, in consultation with ESMA, shall
Amendment 62 #
Proposal for a directive Article 24 – paragraph 4 4. E
Amendment 63 #
Proposal for a directive Article 24 – paragraph 4 4. EBA, in c
Amendment 64 #
Proposal for a directive Article 25 – paragraph 1 Amendment 65 #
Proposal for a directive Article 25 – paragraph 1 – introductory part 1. Member States shall require investment firms to disclose by Member State and by third country in which the investment firm has
Amendment 66 #
Proposal for a directive Article 25 – paragraph 1 – introductory part 1. Member States shall require investment firms except those which qualify as small and non-interconnected to disclose by Member State and by third country in which the investment firm has a branch or a subsidiary that is a financial institution as defined in Article 4(1)(26) of Regulation (EU) No 575/2013, the following information on an annual basis:
Amendment 67 #
Proposal for a directive Article 25.º – paragraph 1 – introductory part 1. Member States shall require investment firms to publicly disclose by Member State and by third country in which the investment firm has a branch or a subsidiary that is a financial institution as defined in Article 4(1)(26) of Regulation (EU) No 575/2013, the following information on an annual basis:
Amendment 68 #
Proposal for a directive Article 25 – paragraph 1 – point a (a)
Amendment 69 #
Proposal for a directive Article 25 – paragraph 1 – point b (b) the
Amendment 70 #
Proposal for a directive Article 25 – paragraph 1 – point d (d) the amount of profit or loss before income tax;
Amendment 71 #
Proposal for a directive Article 25 – paragraph 1 – point e (e) the
Amendment 72 #
Proposal for a directive Article 25 – paragraph 1 – point f a (new) (fa) the amount of income tax paid, which is the amount of income tax paid during the relevant financial year by subsidiaries, branches, joint ventures, undertakings and establishments resident for tax purposes in the relevant tax jurisdiction;
Amendment 73 #
Proposal for a directive Article 25 – paragraph 1 – point f b (new) (fb) stated capital;
Amendment 74 #
Proposal for a directive Article 25 – paragraph 1 – point f c (new) (fc) the amount of accumulated earnings at the end of the period;
Amendment 75 #
Proposal for a directive Article 25 – paragraph 1 – point f d (new) (fd) fixed investment intangible plant, equipment, inventories and stocks and the annual cost of maintaining that tangible plant and equipment;
Amendment 76 #
Proposal for a directive Article 25 – paragraph 1 – point f e (new) (fe) whether subsidiaries, branches, joint ventures, undertakings or establishments have benefited from a preferential tax treatment during the course of the period that might or does permit the payment of tax at a lower rate than that generally applied to profits arising in the jurisdiction and provide a description of the arrangement in question.
Amendment 77 #
Proposal for a directive Article 25 – paragraph 1 a (new) 1a. For the purposes of point (e) of the first paragraph, the current tax expense shall relate only to the activities of an undertaking in the current financial year and shall only include those sums likely to fall due for payment within twelve months of the period end and shall exclude all deferred taxes.
Amendment 78 #
Proposal for a directive Article 25 – paragraph 2 Amendment 79 #
Proposal for a directive Article 25 – paragraph 2 2. The information referred to in paragraph 1 shall be audited in accordance with Directive 2006/43/EC and
Amendment 80 #
Proposal for a directive Article 26 – paragraph 4 Amendment 81 #
Proposal for a directive Article 26 – paragraph 4 – subparagraph 1 Member States shall
Amendment 82 #
Proposal for a directive Article 26 – paragraph 4 – subparagraph 2 Members of the risk committee referred to in the first subparagraph shall have appropriate knowledge, skills and expertise to fully understand, manage and monitor the risk strategy and the risk appetite of the investment firm. They shall ensure that the risk committee advises the management body on the investment firm’s overall current and future risk appetite and strategy and assists the management body in overseeing the implementation of that strategy by senior management. The management body shall retain overall responsibility for the firm’s risk strategies and policies. Investment firms shall aim at a gender balance in their risk committees.
Amendment 83 #
Proposal for a directive Article 27 – title Risk-to-customers, risk-to-market, risk-to- firm and liquidity mismatch risk
Amendment 84 #
Proposal for a directive Article 27 – paragraph 1 a (new) 1a. Competent authorities shall ensure that large asset managers and third country large asset managers enforce effective strategies and processes to assess and manage on an ongoing basis the liquidity mismatch between investment assets and redemption terms for fund units in such a way as to be able to cope with extreme but plausible scenarios of market stress. In so doing they shall take into account the delegated acts adopted by the Commission in accordance with Article 22a.
Amendment 85 #
Proposal for a directive Article 28 – paragraph 1 – introductory part 1. Competent authorities shall ensure that investment firms, when establishing and applying their remuneration policies for senior management, risk takers, staff engaged in control functions and for any employee receiving overall remuneration equal to at least the lowest remuneration received by senior management or risk takers, and whose professional activities have a material impact on the risk profile of the investment firm or of the assets that it manages, comply with the following principles:
Amendment 86 #
Proposal for a directive Article 28 – paragraph 1 – point a (a) the remuneration policy is clear
Amendment 87 #
Proposal for a directive Article 28 – paragraph 1 – point a (a) the remuneration policy is clear
Amendment 88 #
Proposal for a directive Article 28 – paragraph 1 – point b a (new) (ba) the remuneration policy should not only reflect short term profitability, but also take into account long term effects of the investment decisions taken, looking at the ESG criteria;
Amendment 89 #
Proposal for a directive Article 28 – paragraph 1 – point d a (new) (da) the highest remuneration in the investment firm does not exceed 30 times the average remuneration of the lowest paid 5 percent of employees;
Amendment 90 #
Proposal for a directive Article 28 – paragraph 1 – point d a (new) (da) the ratio of remuneration between an investment firm’s employees and board members shall be proportionate;
Amendment 91 #
Proposal for a directive Article 28 – paragraph 1 – point d b (new) (db) a pay ratio of 1 to 20 between the average total remuneration and the highest total remuneration within the same investment firm is respected;
Amendment 92 #
Proposal for a directive Article 28.º – paragraph 1 – point h – point ii (ii) variable remuneration, which reflects a sustainable and risk adjusted performance of the employee, as well as performance in excess of the employee's job description
Amendment 93 #
Proposal for a directive Article 28 – paragraph 1 – point i (i) the fixed component shall represent a
Amendment 94 #
Proposal for a directive Article 28 – paragraph 2 Amendment 95 #
Proposal for a directive Article 28 – paragraph 2 2. For the purposes of point (i) of paragraph 1, Member States shall ensure that investment firms set the appropriate ratios between the variable and the fixed component of the total remuneration in their remuneration policies, taking into account the business activities of the investment firm and associated risks, as well as the impact that different categories of individuals referred to in paragraph 1 have on the risk profile of the investment firm
Amendment 96 #
Proposal for a directive Article 28 – paragraph 2 2. For the purposes of point (i) of paragraph 1, Member States shall ensure that investment firms set the appropriate ratios between the variable and the fixed component of the total remuneration in their remuneration policies, taking into account the business activities of the investment firm and associated risks, as well as the impact that different categories of individuals referred to in paragraph 1 have on the risk profile of the investment firm. The variable component of the remuneration shall not exceed 100% of the fixed component.
Amendment 97 #
Proposal for a directive Article 28 – paragraph 2 a (new) 2a. For the purposes of point (da), for those investment firms which do not comply with the criteria set in Article 30(4)(a), Member States shall ensure that they set a maximum remuneration ratio and that investment firms shall apply it. The investment firm shall calculate its remuneration ratio as quotients of: (i) the remuneration received by each individual member of its board; (ii) and the median of the annual remuneration of all its employees with the exception of board members.
Amendment 98 #
Proposal for a directive Article 28 – paragraph 4 – subparagraph 1 EBA, in consultation with ESMA, shall develop draft regulatory technical standards to specify appropriate criteria to identify the categories of individuals whose professional activities have a material impact on the investment firm’s risk profile as referred to in paragraph 1. EBA and ESMA shall duly take into account Commission Recommendation 2009/384/EC of 30 April 2009 on remuneration policies in the financial services sector as well as existing remuneration guidelines under UCITS, AIFMD and MiFID II and aim to minimise divergence from existing provisions.
Amendment 99 #
Proposal for a directive Article 28 – paragraph 4 – subparagraph 1 E
source: 623.597
2018/06/12
JURI
84 amendments...
Amendment 100 #
Proposal for a directive Article 30 – paragraph 1 – introductory part 1. Member States shall ensure that any variable remuneration awarded and paid by an investment firm
Amendment 101 #
Proposal for a directive Article 30 – paragraph 1 – point a (a) where variable remuneration is performance related, the total amount of variable remuneration shall be based on a combination of the assessment of the performance of the individual, -regardless the gender-, of the business unit concerned and of the overall results of the investment firm;
Amendment 102 #
Proposal for a directive Article 30 – paragraph 1 – point j a (new) (ja) as a derogation from point (j) in case an investment firm does not issue any of those instruments, national competent authorities can approve the use of alternative arrangements fulfilling the same objectives;
Amendment 103 #
Proposal for a directive Article 30 – paragraph 1 – point k Amendment 104 #
Proposal for a directive Article 30 – paragraph 1 – point k (k) at least
Amendment 105 #
Proposal for a directive Article 30 – paragraph 4 – subparagraph 1 – point a (a) an investment firm, the asset value of which is on average equal to or less than EUR
Amendment 106 #
Proposal for a directive Article 30 – paragraph 4 – subparagraph 1 – point b (b) an
Amendment 107 #
Proposal for a directive Article 31 – paragraph 1 1. Member States shall ensure that competent authorities have the necessary powers to guarantee that investment firms which
Amendment 108 #
Proposal for a directive Article 31 – paragraph 2 2. Member States shall ensure that competent authorities have the necessary powers to guarantee that the remuneration committee is responsible for the preparation of decisions regarding remuneration, including decisions which have implications for the risk and risk management of the investment firm concerned and which are to be taken by the management body. The Chair and the members of the remuneration committee shall be members of the management body who do not perform any executive function
Amendment 109 #
Proposal for a directive Article 31 – paragraph 3 3. When preparing the decisions referred to in paragraph 2, the remuneration committee shall take into account the public interest and the long- term interests of shareholders, investors and other stakeholders in the investment firm and ensure that the remuneration policy decisions are gender neutral.
Amendment 110 #
Proposal for a directive Article 32 – paragraph 1 1. Member States shall ensure that competent authorities collect the information disclosed in accordance with points (a), (b), (ba), (c), (d) and (f) of Article 51 of [Regulation (EU) ---/----[IFR] and use that information to benchmark remuneration
Amendment 111 #
Proposal for a directive Article 32 – paragraph 3 3. EBA, in consultation with ESMA, shall issue guidelines on the application of sound and gender neutral remuneration policies. Those guidelines shall take into account at least the requirements referred to in Articles 28 to 31 and principles on sound remuneration policies set out in Commission Recommendation 2009/384/EC43 . _________________ 43 Commission Recommendation 2009/384/EC of 30 April 2009 on remuneration policies in the financial services sector (OJ L 120, 15.5.2009, p. 22).
Amendment 112 #
Proposal for a directive Article 32 – paragraph 3 3. EBA, in consultation with ESMA,
Amendment 113 #
Proposal for a directive Article 32 – paragraph 4 4. Member States shall ensure that investment firms provide competent authorities, where requested, with information on the number of natural persons per investment firm that are remunerated EUR 1 million or more per financial year, in pay brackets of EUR 1 million, including information on their job responsibilities, the business area involved and the
Amendment 114 #
Proposal for a directive Article 33 – paragraph 1 – point f a (new) (fa) the inclusive consideration of risks related to environmental, social and governance (ESG) factors in the risk- mitigating arrangements of the investment firms.
Amendment 115 #
Proposal for a directive Article 36 – paragraph 2 – subparagraph 1 – point g (g) to require investment firms to
Amendment 116 #
Proposal for a directive Article 36 – paragraph 2 – subparagraph 1 – point l a (new) (la) to require investment firms to reduce risks posed to the security of their network and information systems to ensure confidentiality, integrity and availability of the processes and data.
Amendment 117 #
Proposal for a directive Article 37 – paragraph 1 – point a (a) the investment firm is exposed to risks or elements of risks that are not covered or not sufficiently covered by the capital requirement set out in Part Three of [Regulation (EU) ---/----[IFR], especially taking into account risks in relation to environmental, social and governance (ESG) factors;
Amendment 118 #
Proposal for a directive Article 43 – paragraph 1 Where an emergency situation arises, including a situation as described in Article 18 of Regulation (EU) No 1093/2010 or adverse developments in markets, which potentially jeopardises the market liquidity and the stability or security of the financial system in any of the Member States where entities of an investment firm group have been authorised the group supervisor determined pursuant to Article 42 shall, subject to Section 2, Chapter 1 of this Title, alert as soon as practicable, EBA, ESRB and any
Amendment 119 #
Proposal for a directive Article 58 a (new) Directive 2014/59/EU Article 2(1), point (3) Article 58 a Amendment to Directive 2014/59/EU Directive 2014/59/EU is amended as follows: in Article 2(1), point (3) is replaced by the following: "(3) 'investment firm' means an investment firm as defined in point (2) of Article 4(1) of Regulation (EU) No 575/2013 that is subject to the initial capital requirement laid down in Article 8(1) of [Directive (EU) ---/---- [IFD]];".
Amendment 120 #
Proposal for a directive Article 60 – paragraph 1 a (new) By [5 years from the date of application of this Directive] and subsequently every 3 years, the Commission shall submit to the European Parliament and the Council a report on the application of this Directive and its impacts.
Amendment 37 #
Proposal for a directive Recital 2 (2) The existing prudential regimes under Regulation (EU) No 575/2013 and Directive 2013/36/EU are largely based on successive iterations of the international regulatory standards set for large banking groups by the Basel Committee on Banking Supervision and only partially address the specific risks inherent to the diverse activities of investment firms. The specific vulnerabilities and risks inherent to investment firms should therefore be further addressed by means of effective, appropriate and proportionate prudential arrangements at Union level, helping to provide a level playing field across the EU and guaranteeing effective prudential supervision, while keeping compliance costs in check and ensuring sufficient capital for the risks of most investment firms.
Amendment 38 #
Proposal for a directive Recital 3 (3) Sound prudential supervision should ensure that investment firms are managed in an orderly way and in the best interests of their clients. They should take into account the potential for investment
Amendment 39 #
Proposal for a directive Recital 3 (3) Sound prudential supervision should ensure that investment firms are managed in an orderly way and in the best interests of their clients. They should take into account the potential for investment firms and their clients to engage in excessive risk-taking and the different degrees of risk assumed and posed by investment firms. Equally, such prudential supervision should a
Amendment 40 #
Proposal for a directive Recital 4 (4) Many of the requirements that stem from Regulation (EU) No 575/2013 and Directive 2013/36/EU framework are designed to address common risks faced by credit institutions. Accordingly, the existing requirements are largely calibrated to preserve the lending capacity of credit institutions through economic cycles and to protect depositors and taxpayers from possible failure, and are not designed to address the different risk-profiles of investment firms. Investment firms do not have large portfolios of retail and corporate loans and do not take deposits. The likelihood that their failure can have detrimental impacts for overall financial stability is lower than in the case of credit institutions, but they still pose a risk which has to be addressed through a robust framework. The risks faced and posed by investment firms are thus substantially different to the risks faced and posed by credit institutions and such difference should be clearly reflected in the prudential framework of the Union.
Amendment 41 #
Proposal for a directive Recital 4 (4) Many of the requirements that stem from Regulation (EU) No 575/2013 and Directive 2013/36/EU of the European Parliament and of the Council framework are designed to address common risks faced by credit institutions. Accordingly, the existing requirements are largely calibrated to preserve the lending capacity of credit
Amendment 42 #
Proposal for a directive Recital 5 (5) Differences in the application of the existing framework in different Member States threaten the level playing-field for investment firms within the Union, hampering investors’ access to new opportunities and better ways of managing their risks. Those differences stem from the overall complexity of the application of the framework to different investment firms based on the services they provide, where some national authorities adjust or streamline such application in national law or practice. Given that the existing prudential framework does not address all the risks faced and posed by some types of investment firms, large capital add-ons have been applied to certain investment firms in some Member States. Uniform provisions addressing those risks should be established in order to ensure harmonised
Amendment 43 #
Proposal for a directive Recital 5 (5) Differences in the application of the existing framework in different Member States threaten the level playing-field for investment firms within the Union. Those differences stem from the overall complexity of the application of the framework to different investment firms based on the services they provide, where some national authorities adjust or streamline such application in national law or practice. Given that the existing prudential framework does not address all the risks faced and posed by some types of investment firms, large capital add-ons have been applied to certain investment firms in some Member States. Uniform provisions addressing those risks should be established in order to ensure clear harmonised prudential supervision of investment firms across the Union.
Amendment 44 #
Proposal for a directive Recital 7 (7) There may be Member States in which the authorities competent for the prudential supervision of investment firms are different from the authorities that are competent for the supervision of market conduct. It is therefore necessary to create a mechanism of cooperation and exchange of information between those authorities in order to ensure harmonised prudential supervision of investment firms across the European Union.
Amendment 45 #
Proposal for a directive Recital 7 (7) There may be Member States in which the authorities competent for the prudential supervision of investment firms are different from the authorities that are competent for the supervision of market conduct. It is therefore necessary to create a mechanism of cooperation and exchange of information between those authorities and ensure that it functions promptly and efficiently.
Amendment 46 #
Proposal for a directive Recital 9 (9) The required level of initial capital of an investment firm should be based on the services and activities which that investment firm is authorised to provide, and respectively perform, according to Directive 2004/39/EC of the European Parliament and of the Council. The possibility for Member States to lower the required level of initial capital in specific situations, as provided for in Directive 2013/36/EU of the European Parliament and of the Council, on the one hand, and the situation of uneven implementation of that Directive, on the other hand, have led to a situation where the required level of initial capital diverges across the Union. To end that fragmentation, the required level of initial capital should be harmonised accordingly for all investment firms in the European Union.
Amendment 47 #
Proposal for a directive Recital 11 (11) The proper functioning of the internal market requires that the responsibility for supervising the financial soundness of an investment firm, and in particular its solvency, lies with the competent authority of its home Member State. To achieve an effective supervision of investment firms also in other Member States where they provide services or have a branch, close cooperation and exchange of information with the competent authorities of these Member States should be ensured.
Amendment 48 #
Proposal for a directive Recital 12 (12) For informational and supervisory purposes, and in particular to ensure the stability and security of the financial system, competent authorities of host Member States should be able to carry out, on a case-by-case basis, on-the-spot checks, inspect the activities of branches of investment firms on their territory and require information about the activities of those branches. Supervisory measures for those branches should however remain the responsibility of the home Member State.
Amendment 49 #
Proposal for a directive Recital 13 (13) To protect commercially sensitive information, competent authorities should be
Amendment 50 #
Proposal for a directive Recital 16 (16) To safeguard compliance with the obligations laid down in this Directive and [Regulation (EU) ---/----[IFR], Member States should provide for administrative penalties and other administrative measures which are effective, proportionate and dissuasive. In order to ensure that administrative penalties have a dissuasive effect they should be published except in certain well-defined and justified circumstances. To enable clients and investors to make an informed decision about their investment options, those clients and investors should have access to information on administrative penalties and measures imposed on investment firms.
Amendment 51 #
Proposal for a directive Recital 17 (17) To detect breaches of national provisions transposing this Directive and breaches of [Regulation (EU)---/----[IFR], Member States should have the necessary investigatory powers and should establish effective and rapid mechanisms to report potential or actual breaches.
Amendment 52 #
Proposal for a directive Recital 18 (18) Investment firms should have internal capital available, which is adequate in quantity, quality and distribution to cover the specific risks to which they are or may be exposed. Competent authorities should ensure that investment firms have the adequate strategies and processes in place to asses and maintain the adequacy of their internal capital.
Amendment 53 #
Proposal for a directive Recital 20 (20) To align remuneration with the risk profile of investment firms and to guarantee a level-playing field, investment firms should be subject to clear principles on corporate governance arrangements and rules on remuneration that take into account the differences between credit institutions and investment firms. Small and non-interconnected investment firms should however be exempted from those rules because the provisions on remuneration and corporate governance under Directive 2014/65/EU of the European Parliament and of the Council are sufficiently comprehensive for those types of firms.
Amendment 54 #
Proposal for a directive Recital 20 (20) To align remuneration with the risk profile of investment firms and to guarantee a level-playing field, investment firms should be subject to clear principles on corporate governance arrangements and rules on remuneration that are gender neutral and that take into account the differences between credit institutions and investment firms. Small and non- interconnected investment firms should however be exempted from those rules because the provisions on remuneration and corporate governance under Directive 2014/65/EU are sufficiently comprehensive for those types of firms.
Amendment 55 #
Proposal for a directive Recital 24 Amendment 56 #
Proposal for a directive Recital 24 (24) In response to the growing public demand for tax transparency and to promote investment firms' corporate responsibility, it is appropriate to require that investment firms disclose on a yearly basis certain information, including information on profits made, taxes paid and any public subsidies received.
Amendment 57 #
Proposal for a directive Article 4 – paragraph 1 1. Member States shall designate one or more competent authorities that carry out the functions and duties provided for in this Directive. The Member States shall inform the Commission, EBA and E
Amendment 58 #
Proposal for a directive Article 6 – paragraph 2 – point a (a) competent authorities, as parties to the ESFS, cooperate with trust and full mutual respect, in particular when ensuring the flow of appropriate
Amendment 59 #
Proposal for a directive Article 6 – paragraph 2 – point c (c) competent authorities make every effort to
Amendment 60 #
Proposal for a directive Article 6 – paragraph 2 – point c (c) competent authorities
Amendment 61 #
Proposal for a directive Article 8 – paragraph 4 4. The Commission shall update, by
Amendment 62 #
Proposal for a directive Article 11 – paragraph 2 2. The competent authorities of the home Member State shall immediately provide the competent authorities of the host Member State with any information and findings about any potential problems and risks posed by an investment firm to the protection of clients or the stability or security of the financial system in the host Member State which they have identified when supervising the activities of an investment firm.
Amendment 63 #
Proposal for a directive Article 11 – paragraph 4 4. Where, following the communication of the information and findings referred to in paragraph 2, the competent authorities of the host Member State consider that the competent authorities of the home Member State have not taken the necessary measures referred to in paragraph 3, the competent authorities of the host Member State may, after having informed without delay the competent authorities of the home Member State and EBA, take appropriate measures to protect clients to whom services are provided and to protect the stability and security of the financial system.
Amendment 64 #
Proposal for a directive Article 11 – paragraph 5 5. Competent authorities of the home Member State that disagree with the measures of the competent authorities of the host Member State may refer the matter to EBA, which shall act in accordance with the procedure laid down in Article 19 of Regulation (EU) No 1093/2010. Where EBA acts in accordance with that Article, it shall adopt its decision
Amendment 65 #
Proposal for a directive Article 11 – paragraph 8 8. EBA shall submit the draft technical standards referred to in paragraphs 6 and 7 to the Commission by [
Amendment 66 #
Proposal for a directive Article 12 – paragraph 2 – subparagraph 1 The competent authorities of the host Member State shall, for supervisory purposes and where they consider it relevant for reasons of stability or security of the financial system in the host Member State, have the power to carry out, on a case-by-
Amendment 67 #
Proposal for a directive Article 12 – paragraph 2 – subparagraph 2 Before carrying out those checks and inspections, the competent authorities of the host Member State shall, without delay, consult the competent authorities of the home Member State.
Amendment 68 #
Proposal for a directive Article 12 – paragraph 2 – subparagraph 3 A
Amendment 69 #
Proposal for a directive Article 13 – paragraph 4 4. Competent authorities may exchange confidential information for the purposes of paragraph 2, may expressly state how that information is to be treated and may
Amendment 70 #
Proposal for a directive Article 16 – paragraph 1 – subparagraph 3 The administrative penalties and other administrative measures shall be effective, proportionate and dissuasive and Member States shall apply a harmonised set of penalties for similar offences to avoid treaty shopping.
Amendment 71 #
Proposal for a directive Article 16 – paragraph 2 – subparagraph 1 – point d (d) in case of a legal person, administrative pecuniary penalties of up to 1
Amendment 72 #
Proposal for a directive Article 16 – paragraph 2 – subparagraph 1 – point d (d) in case of
Amendment 73 #
Proposal for a directive Article 16 – paragraph 2 – subparagraph 1 – point e (e) in the case of a legal person, administrative pecuniary penalties of up to t
Amendment 74 #
Proposal for a directive Article 16 – paragraph 2 – subparagraph 1 – point e (e) in the case of
Amendment 75 #
Proposal for a directive Article 17 – paragraph 1 – point b – point iv (iv) to interview any other
Amendment 76 #
Proposal for a directive Article 18 – paragraph 1 1. Member States shall ensure that competent authorities publish on their official website any administrative penalties and measures imposed in accordance with Article 16 and which has not been appealed or can no longer be appealed, without undue delay. That publication shall include information on the type and nature of the breach and the identity of the natural or legal person on whom the penalty is imposed or against whom the measure is taken. The information shall only be published after that person has been informed of those
Amendment 77 #
Proposal for a directive Article 18 – paragraph 2 2. Where Member States permit the publication of administrative penalties or measures imposed in accordance with Article 16 against which there has been an appeal, competent authorities shall also publish on their official website information on the appeal status and on the outcome of the appeal. Competent authorities shall ensure that the same information is published on the official website of the investment firm concerned.
Amendment 78 #
Proposal for a directive Article 19 – paragraph 1 Competent authorities shall inform EBA of administrative penalties and measures imposed pursuant to Article 16, of any appeal against those penalties and measures and of the outcome thereof. EBA
Amendment 79 #
Proposal for a directive Article 23 – paragraph 4 – subparagraph 2 Member States shall ensure that investment firms subject to this Section implement the requirements of this Section in their subsidiaries that are financial institutions as defined in Article 4(13) of [Regulation (EU) ---/----[IFR], including those established in third countries, unless the parent undertaking in the Union
Amendment 80 #
Proposal for a directive Article 25 Amendment 81 #
Proposal for a directive Article 25 – paragraph 1 – point a (a) the name
Amendment 82 #
Proposal for a directive Article 25 – paragraph 1 – point f a (new) (fa) stated capital;
Amendment 83 #
Proposal for a directive Article 25 – paragraph 1 – point f b (new) (fb) whether undertakings, subsidiaries or branches benefit from a preferential tax treatment, licences or equivalent regimes;
Amendment 84 #
Proposal for a directive Article 25 – paragraph 1 – point f c (new) (fc) the amount of the net turnover, including a distinction between the turnover made with related parties and the turnover made with unrelated parties;
Amendment 85 #
Proposal for a directive Article 25 – paragraph 2 2. The information referred to in paragraph 1 shall be reported separately for each Member State in accordance with Directive 2013/34/EU. The information referred to in paragraph 1 shall be audited in accordance with Directive 2006/43/EC and, where possible, shall be annexed to the annual financial statements or, where applicable, to the consolidated financial statements of that investment firm.
Amendment 86 #
Proposal for a directive Article 26 – paragraph 4 – subparagraph 1 Member States shall
Amendment 87 #
Proposal for a directive Article 26 – paragraph 4 – subparagraph 2 Members of the risk committee referred to in the first subparagraph shall have appropriate knowledge, skills and expertise to fully understand, manage and monitor the risk strategy and the risk appetite of the investment firm. They shall ensure that the risk committee advises the management body on the investment firm's overall current and future risk appetite and strategy and assists the management body in overseeing the implementation of that strategy by senior management. The management body shall retain overall responsibility for the firm´s risk strategies and policies. Investment firms shall aim at a gender balance in their risk committees.
Amendment 88 #
Proposal for a directive Article 28 – paragraph 1 – point a (a) the remuneration policy is clear
Amendment 89 #
Proposal for a directive Article 28 – paragraph 1 – point i a (new) (ia) the ratio of remuneration between an investment firm's employees and board members shall be proportionate;
Amendment 90 #
Proposal for a directive Article 28 – paragraph 2 Amendment 91 #
Proposal for a directive Article 28 – paragraph 2 a (new) 2a. For the purpose of point (ia), for those investment firms which do not comply with the criteria set in article 30(4)(a), Member States shall ensure that they set a maximum remuneration ratio and that investment firms shall apply it. The investment firm shall calculate its remuneration ratio as quotients of: i) the remuneration received by each individual member of its board; ii) and the median of the annual remuneration of all its employees with the exception of board members.
Amendment 92 #
Proposal for a directive Article 28 – paragraph 3 3. Member States shall ensure that investment firms apply the principles referred to in paragraph 1 in a manner that is proportionate and appropriate to their size
Amendment 93 #
Proposal for a directive Article 29 – paragraph 1 – introductory part Member States shall ensure that where an investment firm benefits from extraordinary public financial support as defined to in Article 2(1)(28) of Directive 2014/59/EU,
Amendment 94 #
Proposal for a directive Article 29 – paragraph 1 – point a Amendment 95 #
Proposal for a directive Article 29 – paragraph 1 – point a (a) where variable remuneration would be inconsistent with the maintenance of a sound capital base of an investment firm and its timely exit from extraordinary
Amendment 96 #
Proposal for a directive Article 29 – paragraph 1 – point b Amendment 97 #
Proposal for a directive Article 29 – paragraph 1 – point c Amendment 98 #
Proposal for a directive Article 29 – paragraph 2 Amendment 99 #
Proposal for a directive Article 30 – paragraph 1 – introductory part 1. Member States shall ensure that any variable remuneration awarded and paid by an investment firm to senior management, risk takers, staff engaged in control functions and for any employee receiving overall remuneration equal to at least the lowest remuneration received by senior management or risk takers and whose professional activities have a material impact on the risk profile of the investment firm, complies with all of the following requirements:
source: 623.590
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2018-01-17Show (1) Changes | Timetravel
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