84. The aspects that the competent authority should inter alia have regard to when assessing …

The aspects that the competent authority should inter alia have regard to when assessing whether the issuer is ‘unable or likely to be unable to fulfil its obligations’ under Regulation (EU) 2023/1114 are the following:

• i. capital position of the issuer: infringement of the requirements under Article 35(1) to (5) and Article 45(5) of Regulation (EU) 2023/1114;
• ii. liquidity position of the issuer under applicable requirements set out in Regulation (EU) 2023/1114 and/or of the reserve of assets:
• o infringement of the liquidity requirements, or, if subject to a requirement to hold a reserve of assets, of the requirements relating to the level and composition of the reserve of assets set out in Chapters 3 and 5 of Title III of Regulation (EU) 2023/1114, including any specification in accordance with Articles 36(4), 38(5) and 45(7)(b) of that Regulation, once the relevant delegated regulations apply, in a way that would justify the withdrawal of the issuer’s authorisation by the competent authority;
• o being unable to pay debts and liabilities as they fall due; and
• o having the reserve of assets lower than liabilities;

14 Directive of the European Parliament and of the Council of 26 June 2013 on access to the activity of credit institutions

and the prudential supervision of credit institutions and investment firms, amending Directive 2002/87/EC and repealing Directives 2006/48/EC and 2006/49/EC (OJ L 176, 27.6.2013, p. 338). 28

• iii. with respect to issuers of ARTs authorised in accordance with Article 21 of Regulation (EU) 2023/1114, other requirements for continuing authorisation:
• o in relation to governance arrangements: accumulation of material weaknesses or deficiencies in key areas of the governance arrangements or internal control functions, including risk management and ICT risk management, which alone or together have a material negative prudential impact on the issuer and/or its operational resilience; or any other elements considered relevant by the competent authority;
• o material deficiencies which in combination can have a material negative prudential impact on the issuer, such as major reputational depreciation arising from a lack of transparency in the conduct of business and operations or incomplete/inaccurate disclosure of information.

1. Overview

1.1 References

• Article 45 5.
• Article 21 Grant or refusal of the authorisation

1.2 Identified Requirements

1.3 Related Standards

2. Identified Requirements

3. Related Standards

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