7. General principles when identifying a subset of sectoral exposures

When identifying a subset of sectoral exposures in accordance with Sections 4 to 6, the relevant authority should ensure the right balance between addressing the macroprudential or systemic risks stemming from the targeted subset and the unintended consequences of applying a SyRB to this subset.

In order to facilitate a proper identification of subsets of sectoral exposures to which SyRB may apply, and in particular to avoid overlaps and double counting of risks, relevant authorities should cooperate with competent authorities, where different.

7.1. Unwarranted interactions with other macroprudential measures

For the purposes of paragraph 33, relevant authorities should in particular:

• a. ensure that the risks being addressed by the application of a sectoral SyRB determined in accordance with these guidelines are clearly and thoroughly defined;
• b. take into account and specify, when they are planning to introduce a sectoral SyRB, the interaction with other active macro-prudential measures in order to avoid activating the SyRB in an unwarranted manner for risks that have already been addressed by those macroprudential measures;
• c. avoid unwarranted interactions that may emerge between SyRBs if the same systemic risks are targeted by multiple SyRBs (sectoral and/or broader SyRBs) or where the same element for the identification of a subset of sectoral exposures is used in multiple sectoral SyRBs.

7.2. Reciprocity

When identifying an appropriate subset of sectoral exposures to which relevant authorities may apply a SyRB, they should take into account the following:

• a. An excessively granular application of the sectoral SyRB will disincentivise other authorities from reciprocating in accordance with Article 134 of Directive 2013/36/EU if the implementation of the measure by institutions and subsequent monitoring by relevant authorities are likely to be associated with high costs,
• b. Data gaps stemming from non-harmonised definitions can exist between jurisdictions, leading to challenges in the reciprocation of the measure and hence in the effectiveness of the measure. In order to reduce such gaps, relevant authorities should make use of pre-existing data sources.

In order to make reciprocity as simple as possible for reciprocating authorities, relevant authorities of the activating Member State should aim to provide all the information (including definitions and relevant calculations) they consider relevant and not available to other Member States so that reciprocating authorities can adequately assess whether to reciprocate the SyRB rate.

Relevant authorities should consider ESRB Recommendation 2015/2 on the assessment of cross-border effects of and voluntary reciprocity for macroprudential policy measures and reciprocate, where appropriate, SyRB measures introduced in other Member States.

7.3. Disclosure

Relevant authorities should aim to publicly disclose any rules or general guidance, including the materiality thresholds referred to in Section 5 of these guidelines, where applicable, issued in order to implement the provisions laid down in these guidelines, provided the disclosure of such information does not jeopardise the stability of the financial system.