Guidance for competent authorities

Competent authorities should make every effort to ensure that institutions and third-country branches, or upon their establishment the intermediate EU parent undertakings and third-country branches, comply with their obligations under Article 21b of Directive 2013/36/EU as specified in these guidelines. In particular, competent authorities should ensure that they receive from institutions and third-country branches, or upon their establishment from the intermediate EU parent undertakings and third-country branches, all information set out in paragraph 19 and that third-country branches fully comply with their obligation to report all assets corresponding to their activities as set out in Article 47(1a), point (a) of Directive 2013/36/EU.

For the purposes of the notification set out in Article 21b(6) of Directive 2013/36/EU, competent authorities should submit to the EBA on an annual basis, without undue delay and no later than 30 June of any given year, the information which they have received from institutions and third-country branches or upon their establishment from the intermediate EU parent undertakings and third-country branches, in accordance with paragraph 19 for the four quarters of the previous calendar year.

Notwithstanding paragraph 23, in case of a material change of the total value of assets of an institution or of a third-country branch that are part of a third-country group, the competent authority should during the year notify the EBA about this change without undue delay. The total value of assets of these institutions or third-country branches should be notified as the average of the total value of those assets calculated over the previous four quarters irrespective of the calendar year.

Where the consolidating or the group supervisor has received the notification referred to in paragraph 18, or where the quarterly assessment shows that the threshold has been reached and the intermediate EU parent undertaking has not been established yet, the consolidating supervisor or the group supervisor should liaise with the notifying institution and with other relevant authorities at least for the following to be determined without undue delay:

• a. Whether the derogations referred to in Articles 21b(2) and 21b(3), second indent, of Directive 2013/36/EU should apply to this particular third-country group;
• b. Having regard to paragraphs 26 and 27, the timeline for the establishment of the intermediate EU parent undertaking.

In determining the relevant timeline referred to in point (b) of paragraph 25, competent authorities should ensure that the intermediate EU parent undertaking will be in operation when the threshold will have been reached. Institutions should make every effort to comply with this requirement in a timely manner.

Notwithstanding paragraph 26 and for the purposes of application of point (b) of paragraph 25, competent authorities may provide for an adequate timeline for the establishment of an intermediate EU parent undertaking where reaching the threshold was not foreseeable within the forward looking-monitoring set out in paragraph 16 and as a result the timeline as specified in paragraph 26 cannot be met, in particular in cases such as mergers and acquisitions not foreseeable in the strategic planning of the group, or where there is reasonable anticipation of the total value of that g roup’s assets in the Union to permanently drop below the threshold within a period not exceeding one year from the date the threshold was reached. The timeline should be as short as possible and should not exceed one year or, in exceptional justified cases, up to two years from the date the threshold was reached, unless the total value of assets in the Union of that group has dropped and remains below the threshold.

Where the conditions set out in Article 21b of Directive 2013/36/EU have been met and an intermediate EU parent undertaking has not been established within the timeline determined under point (b) of paragraph 25 and in accordance with paragraph 26 or 27, the competent authorities of the institutions of that third-country group should, without undue delay, coordinate in order to take all the measures necessary to ensure that Article 21b of Directive 2013/36/EU will be complied with.

Where the total value of assets in the Union of a third-country group calculated in accordance with paragraphs 10 and 11 has dropped significantly and permanently below the threshold set out in Article 21b(4) of Directive 2013/36/EU as a result of strategic changes in European operations of that third-country group, the consolidating supervisor and, where applicable, the group supervisor and the competent authorities should, following a relevant group’s request, coordinate to determine whether the threshold should be deemed as no longer exceeded before the end of the period of twelve consecutive quarters referred to in paragraph 14.