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Document 02019R2175-20191227
Regulation (EU) 2019/2175 of the European Parliament and of the Council of 18 December 2019 amending Regulation (EU) No 1093/2010 establishing a European Supervisory Authority (European Banking Authority), Regulation (EU) No 1094/2010 establishing a European Supervisory Authority (European Insurance and Occupational Pensions Authority), Regulation (EU) No 1095/2010 establishing a European Supervisory Authority (European Securities and Markets Authority), Regulation (EU) No 600/2014 on markets in financial instruments, Regulation (EU) 2016/1011 on indices used as benchmarks in financial instruments and financial contracts or to measure the performance of investment funds, and Regulation (EU) 2015/847 on information accompanying transfers of funds (Text with EEA relevance)
Consolidated text: Regulation (EU) 2019/2175 of the European Parliament and of the Council of 18 December 2019 amending Regulation (EU) No 1093/2010 establishing a European Supervisory Authority (European Banking Authority), Regulation (EU) No 1094/2010 establishing a European Supervisory Authority (European Insurance and Occupational Pensions Authority), Regulation (EU) No 1095/2010 establishing a European Supervisory Authority (European Securities and Markets Authority), Regulation (EU) No 600/2014 on markets in financial instruments, Regulation (EU) 2016/1011 on indices used as benchmarks in financial instruments and financial contracts or to measure the performance of investment funds, and Regulation (EU) 2015/847 on information accompanying transfers of funds (Text with EEA relevance)
Regulation (EU) 2019/2175 of the European Parliament and of the Council of 18 December 2019 amending Regulation (EU) No 1093/2010 establishing a European Supervisory Authority (European Banking Authority), Regulation (EU) No 1094/2010 establishing a European Supervisory Authority (European Insurance and Occupational Pensions Authority), Regulation (EU) No 1095/2010 establishing a European Supervisory Authority (European Securities and Markets Authority), Regulation (EU) No 600/2014 on markets in financial instruments, Regulation (EU) 2016/1011 on indices used as benchmarks in financial instruments and financial contracts or to measure the performance of investment funds, and Regulation (EU) 2015/847 on information accompanying transfers of funds (Text with EEA relevance)
02019R2175 — EN — 27.12.2019 — 000.001
This text is meant purely as a documentation tool and has no legal effect. The Union's institutions do not assume any liability for its contents. The authentic versions of the relevant acts, including their preambles, are those published in the Official Journal of the European Union and available in EUR-Lex. Those official texts are directly accessible through the links embedded in this document
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REGULATION (EU) 2019/2175 OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL of 18 December 2019 amending Regulation (EU) No 1093/2010 establishing a European Supervisory Authority (European Banking Authority), Regulation (EU) No 1094/2010 establishing a European Supervisory Authority (European Insurance and Occupational Pensions Authority), Regulation (EU) No 1095/2010 establishing a European Supervisory Authority (European Securities and Markets Authority), Regulation (EU) No 600/2014 on markets in financial instruments, Regulation (EU) 2016/1011 on indices used as benchmarks in financial instruments and financial contracts or to measure the performance of investment funds, and Regulation (EU) 2015/847 on information accompanying transfers of funds (OJ L 334 27.12.2019, p. 1) |
Corrected by:
REGULATION (EU) 2019/2175 OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL
of 18 December 2019
amending Regulation (EU) No 1093/2010 establishing a European Supervisory Authority (European Banking Authority), Regulation (EU) No 1094/2010 establishing a European Supervisory Authority (European Insurance and Occupational Pensions Authority), Regulation (EU) No 1095/2010 establishing a European Supervisory Authority (European Securities and Markets Authority), Regulation (EU) No 600/2014 on markets in financial instruments, Regulation (EU) 2016/1011 on indices used as benchmarks in financial instruments and financial contracts or to measure the performance of investment funds, and Regulation (EU) 2015/847 on information accompanying transfers of funds
(Text with EEA relevance)
Article 1
Amendments to Regulation (EU) No 1093/2010
Regulation (EU) No 1093/2010 is amended as follows:
Article 1 is amended as follows:
paragraphs 2 and 3 are replaced by the following:
The Authority shall also act within the powers conferred by this Regulation and within the scope of Directive (EU) 2015/849 of the European Parliament and of the Council ( *8 ) and of Regulation (EU) 2015/847 of the European Parliament and of the Council ( *9 ) to the extent that that Directive and Regulation apply to financial sector operators and the competent authorities that supervise them. For that purpose only, the Authority shall carry out the tasks conferred by any legally binding Union act on the European Supervisory Authority (European Insurance and Occupational Pensions Authority), established by Regulation (EU) No 1094/2010 of the European Parliament and of the Council ( *10 ) or on the European Supervisory Authority (European Securities and Markets Authority), established by Regulation (EU) No 1095/2010 of the European Parliament and of the Council ( *11 ). When carrying out such tasks, the Authority shall consult those European Supervisory Authorities and keep them informed of its activities concerning any entity which is a “financial institution” as defined in point (1) of Article 4 of Regulation (EU) No 1094/2010 or a “financial market participant” as defined in point (1) of Article 4 of Regulation (EU) No 1095/2010.
paragraph 5 is amended as follows:
the first subparagraph is amended as follows:
ensuring that the taking of credit and other risks are appropriately regulated and supervised;
enhancing customer and consumer protection;’;
enhancing supervisory convergence across the internal market;
preventing the use of the financial system for the purposes of money laundering and terrorist financing.’;
the second subparagraph is replaced by the following:
‘For those purposes, the Authority shall contribute to ensuring the consistent, efficient and effective application of the acts referred to in paragraph 2 of this Article, foster supervisory convergence, and provide opinions in accordance with Article 16a to the European Parliament, to the Council, and to the Commission.’;
the fourth subparagraph is replaced by the following:
‘When carrying out its tasks, the Authority shall act independently, objectively and in a non-discriminatory and transparent manner, in the interests of the Union as a whole and shall respect, where relevant, the principle of proportionality. The Authority shall be accountable and act with integrity and shall ensure that all stakeholders are treated fairly.’;
the following subparagraph is added:
‘The content and form of the Authority’s actions and measures, in particular guidelines, recommendations, opinions, questions and answers, draft regulatory standards and draft implementing standards, shall fully respect the applicable provisions of this Regulation and of the legislative acts referred to in paragraph 2. To the extent permitted and relevant under those provisions, the Authority’s actions and measures shall, in accordance with the principle of proportionality, take due account of the nature, scale and complexity of the risks inherent in the business of a financial institution, undertaking, other subject or financial activity, that is affected by the Authority’s actions and measures.’;
the following paragraph is added:
Article 2 is amended as follows:
paragraph 1 is replaced by the following:
paragraph 4 is replaced by the following:
in paragraph 5, the following subparagraph is added:
‘Without prejudice to national competences, references in this Regulation to supervision shall include all relevant activities of all competent authorities to be carried out pursuant to the legislative acts referred to in Article 1(2).’;
Article 3 is replaced by the following:
‘Article 3
Accountability of the Authorities
Article 4 is amended as follows:
point (1) is replaced by the following:
“financial institution” means any undertaking that is subject to regulation and supervision pursuant to any of the legislative acts referred to in Article 1(2);’;
the following point is inserted:
“financial sector operator” means an “entity” as referred to in Article 2 of Directive (EU) 2015/849, which is either a financial institution as defined in point (1) of this Article or in point (1) of Article 4 of Regulation (EU) No 1094/2010 or a “financial market participant” as defined in point (1) of Article 4 of Regulation (EU) No 1095/2010;’;
point (2) is replaced by the following:
“competent authorities” means:
competent authorities as defined in point (40) of Article 4(1) of Regulation (EU) No 575/2013, including the European Central Bank with regard to matters relating to the tasks conferred on it by Regulation (EU) No 1024/2013;
with regard to Directive 2002/65/EC, the authorities and bodies competent for ensuring compliance with the requirements of that Directive by financial institutions;
with regard to Directive (EU) 2015/849, the authorities and bodies that supervise financial sector operators and are competent for ensuring their compliance with the requirements of that Directive;
with regard to deposit guarantee schemes, bodies which administer deposit guarantee schemes pursuant to Directive 2014/49/EU or, where the operation of the deposit guarantee scheme is administered by a private company, the public authority supervising those schemes pursuant to that Directive, and relevant administrative authorities as referred to in that Directive;
with regard to Directive 2014/59/EU of the European Parliament and of the Council ( *12 ) and to Regulation (EU) No 806/2014 of the European Parliament and of the Council ( *13 ), the resolution authorities designated in accordance with Article 3 of Directive 2014/59/EU, the Single Resolution Board established by Regulation (EU) No 806/2014, and the Council and the Commission when taking actions under Article 18 of Regulation (EU) No 806/2014, except where they exercise discretionary powers or make policy choices;
“competent authorities” as referred to in Directive 2014/17/EU of the European Parliament and of the Council ( *14 ), in Regulation (EU) 2015/751 of the European Parliament and of the Council ( *15 ), in Directive (EU) 2015/2366, in Directive 2009/110/EC of the European Parliament and of the Council ( *16 ), and in Regulation (EU) No 260/2012 of the European Parliament and of the Council ( *17 );
“bodies and authorities” as referred to in Article 20 of Directive 2008/48/EC.
Article 8 is amended as follows:
paragraph 1 is amended as follows:
point (a) is replaced by the following:
based on the legislative acts referred to in Article 1(2), to contribute to the establishment of high-quality common regulatory and supervisory standards and practices, in particular by developing draft regulatory and implementing technical standards, guidelines, recommendations, and other measures, including opinions;’;
point (aa) is replaced by the following:
to develop and maintain an up-to-date Union supervisory handbook on the supervision of financial institutions in the Union which is to set out supervisory best practices and high-quality methodologies and processes and takes into account, inter alia, changing business practices and business models and the size of financial institutions and of markets;’;
the following point is inserted:
to develop and maintain an up-to-date Union resolution handbook on the resolution of financial institutions in the Union which is to set out best practices and high-quality methodologies and processes for resolution, taking into account the work of the Single Resolution Board, and changing business practices and business models and the size of financial institutions and of markets;’;
point (b) is replaced by the following:
to contribute to the consistent application of legally binding Union acts, in particular by contributing to a common supervisory culture, ensuring consistent, efficient and effective application of the legislative acts referred to in Article 1(2), preventing regulatory arbitrage, fostering and monitoring supervisory independence, mediating and settling disagreements between competent authorities, ensuring effective and consistent supervision of financial institutions, ensuring a coherent functioning of colleges of supervisors and taking actions, inter alia, in emergency situations;’;
points (e) to (h) are replaced by the following:
to organise and conduct peer reviews of competent authorities, and, in that context, to issue guidelines and recommendations and to identify best practices, with a view to strengthening consistency in supervisory outcomes;
to monitor and assess market developments in the area of its competence including where relevant, developments relating to trends in credit, in particular, to households and SMEs and in innovative financial services duly considering developments relating to environmental, social and governance related factors;
to undertake market analyses to inform the discharge of the Authority’s functions;
to foster, where relevant, depositor, consumer and investor protection, in particular with regards to shortcomings in a cross-border context and taking related risks into account;’;
the following point is inserted:
to contribute to the establishment of a common Union financial data strategy;’;
the following point is inserted:
to publish on its website, and to update regularly, all regulatory technical standards, implementing technical standards, guidelines, recommendations and questions and answers for each legislative act referred to in Article 1(2), including overviews that concern the state of play of ongoing work and the planned timing of the adoption of draft regulatory technical standards and draft implementing technical standards.’;
the following point is added:
to contribute to the prevention of the use of the financial system for the purposes of money laundering and terrorist financing, including by promoting consistent, efficient and effective application of legislative acts referred to in Article 1(2) of this Regulation, Article 1(2) of Regulation (EU) No 1094/2010 and Article 1(2) of Regulation (EU) No 1095/2010 respectively with regard to the prevention of the use of the financial system for the purpose of money laundering or terrorist financing.’;
in paragraph 1a, point (b) is replaced by the following:
with due regard to the objective to ensure the safety and soundness of financial institutions, take fully into account the different types, business models and sizes of financial institutions; and’;
in paragraph 1a, the following point is added:
take account of technological innovation, innovative and sustainable business models, and the integration of environmental, social and governance related factors.’;
paragraph 2 is amended as follows:
the following point is inserted:
issue recommendations, as laid down in Article 29a;’;
the following point is inserted:
issue warnings in accordance with Article 9(3);’;
point (g) is replaced by the following:
issue opinions to the European Parliament, to the Council, or to the Commission as provided for in Article 16a;’;
the following points are inserted:
issue answers to questions, as laid down in Article 16b;
take action in accordance with Article 9c;’;
paragraph 2a is replaced by the following:
The open public consultations referred to in Articles 10, 15, 16 and 16a shall be conducted as widely as possible to ensure an inclusive approach towards all interested parties and shall allow reasonable time for stakeholders to respond. The Authority shall publish a summary of the input received from stakeholders and an overview of how information and views gathered from the consultation were used in a draft regulatory technical standard and a draft implementing technical standard.’;
Article 9 is amended as follows:
paragraph 1 is amended as follows:
point (a) is replaced by the following:
collecting, analysing and reporting on consumer trends, such as the development of costs and charges of retail financial services and products in Member States;’;
the following points are inserted:
undertaking in-depth thematic reviews of market conduct, building a common understanding of market practices in order to identify potential problems and analyse their impact;
developing retail risk indicators for the timely identification of potential causes of consumer harm;’;
the following points are added:
contributing to a level playing field in the internal market where consumers and other users of financial services have fair access to financial services and products;
fostering further developments in terms of regulation and supervision which could facilitate deeper harmonisation and integration at the Union level;
coordinating mystery shopping activities of competent authorities, if applicable.’;
paragraph 2 is replaced by the following:
paragraphs 4 and 5 are replaced by the following:
The Authority shall review the decision referred to in the first subparagraph at appropriate intervals and at least every six months. Following at least two consecutive renewals, and based on proper analysis which aims to assess the impact on the customer or consumer, the Authority may decide on the annual renewal of the prohibition.
A Member State may request the Authority to reconsider its decision. In that case, the Authority shall decide, in accordance with the procedure set out in the second subparagraph of Article 44(1), whether to maintain that decision.
The Authority may also assess the need to prohibit or restrict certain types of financial activity or practice and, where there is such a need, inform the Commission and the competent authorities in order to facilitate the adoption of any such prohibition or restriction.
the following articles are inserted:
‘Article 9a
Special tasks related to preventing and countering money laundering and terrorist financing
The Authority shall, within its respective competences, take a leading, coordinating and monitoring role in promoting integrity, transparency and security in the financial system by means of adopting measures to prevent and counter money laundering and terrorist financing in that system. In line with the principle of proportionality, those measures shall not exceed what is necessary to achieve the objectives of this Regulation and of the legislative acts referred to in Article 1(2) and shall have due regard to the nature, scale and complexity of risks, business practices, business models and size of financial sector operators and of markets. Those measures shall include:
collecting information from competent authorities relating to weaknesses identified during ongoing supervision and authorisation procedures in the processes and procedures, governance arrangements, fitness and propriety, acquisition of qualifying holdings, business models and activities of financial sector operators in relation to preventing and countering money laundering and terrorist financing as well as measures taken by competent authorities, in response to the following material weaknesses affecting one or more requirements of the legislative acts referred to in Article 1(2) of this Regulation, Article 1(2) of Regulation (EU) No 1094/2010 and Article 1(2) of Regulation (EU) No 1095/2010 and of any national laws transposing them, respectively, with regard to the prevention and countering the use of the financial system for the purpose of money laundering or of terrorist financing:
a breach or a potential breach by a financial sector operator of such requirements,
the inappropriate or ineffective application by a financial sector operator of such requirements, or
the inappropriate or ineffective application by a financial sector operator of its internal policies and procedures to comply with such requirements.
Competent authorities shall provide all such information to the Authority in addition to any obligations under Article 35 of this Regulation and shall keep the Authority informed in due time about any subsequent developments relating to the information provided. The Authority shall coordinate closely with EU Financial Intelligence Units (FIUs) as referred to in Directive (EU) 2015/849, while respecting their status and obligations and without any unnecessary duplication.
Competent authorities may share, in accordance with national law, any additional information that they deem relevant to the prevention and countering of the use of the financial system for the purpose of money laundering or terrorist financing with the central database referred to in paragraph 2;
coordinating closely, and, where appropriate, exchanging information, with competent authorities, including the European Central Bank with regard to matters relating to the tasks conferred on it by Regulation (EU) No 1024/2013, and with authorities entrusted with the public duty of supervising obliged entities listed in points (1) and (2) of Article 2(1) of Directive (EU) 2015/849 as well as with FIUs, while respecting the status and obligations of the FIUs under Directive (EU) 2015/849;
developing common guidance and standards for preventing and countering money laundering and terrorist financing in the financial sector and promoting their consistent implementation in particular by developing draft regulatory and implementing technical standards, in line with the mandates laid down in the legislative acts referred to in Article 1(2), guidelines, recommendations, and other measures, including opinions which shall be based on the legislative acts referred to in Article 1(2);
providing assistance to competent authorities, following their specific requests;
monitoring market developments and assessing vulnerabilities and risks in relation to money laundering and terrorist financing in the financial sector.
By 31 December 2020, the Authority shall develop draft regulatory technical standards specifying the definition of weaknesses as referred to in point (a) of the first subparagraph, including the corresponding situations where weaknesses may occur, the materiality of weaknesses and the practical implementation of the information collection by the Authority as well as the type of information that should be provided pursuant to point (a) of the first subparagraph. In developing those technical standards, the Authority shall consider the volume of the information to be provided and the need to avoid duplication. It shall also set out arrangements to ensure effectiveness and confidentiality.
Power is delegated to the Commission to supplement this Regulation by adopting the regulatory technical standards referred to in the second subparagraph of this paragraph in accordance with Articles 10 to 14.
By 31 December 2020, the Authority shall develop draft regulatory technical standards specifying how information is to be analysed and made available to competent authorities on a need-to-know and confidential basis.
Power is delegated to the Commission to supplement this Regulation by adopting the regulatory technical standards referred to in the second subparagraph of this paragraph in accordance with Articles 10 to 14.
For the purposes of the first subparagraph of this paragraph, the Authority, through the internal committee established under paragraph 7 of this Article, shall develop and apply methods to allow for an objective assessment, as well as a high- quality and consistent review of the assessments and the application of the methodology and to ensure a level playing field. That internal committee shall carry out the quality and consistency review of the risk assessments. It shall prepare the draft risk assessments for adoption by the Board of Supervisors in accordance with Article 44.
Each institution, authority and body referred to in the first subparagraph shall nominate an alternate representative from its staff, who may replace the member where that person is prevented from attending. Member States where more than one authority is competent for ensuring compliance with Directive (EU) 2015/849 for financial sector operators may nominate one representative for each competent authority. Irrespective of the number of competent authorities represented in the meeting, each Member State shall have one vote. That committee may establish internal working groups on specific aspects of its work with a view to preparing draft decisions of that committee. Those groups shall be open for participation to staff from all competent authorities represented in that committee and from the Authority, the European Supervisory Authority (European Insurance and Occupational Pensions Authority) and the European Supervisory Authority (European Securities and Markets Authority).
The Authority, the European Supervisory Authority (European Insurance and Occupational Pensions Authority) and the European Supervisory Authority (European Securities and Markets Authority) may at any time submit written observations on any draft decision of the committee referred to in paragraph 7 of this Article. The Board of Supervisors shall duly consider such observations before taking its final decision. Where a draft decision is based on, or connected with, the powers conferred upon the Authority under Article 9b, 17 or 19 and concerns:
financial institutions as defined in point (1) of Article 4 of Regulation (EU) No 1094/2010 or any of the competent authorities supervising them, or
financial market participants as defined in point (1) of Article 4 of Regulation (EU) No 1095/2010 or any of the competent authorities supervising them,
the Authority may only take the decision in agreement with the European Supervisory Authority (European Insurance and Occupational Pensions Authority), in the case of point (a), or of the European Supervisory Authority (European Securities and Markets Authority), in the case of point (b). The European Supervisory Authority (European Insurance and Occupational Pensions Authority) or the European Supervisory Authority (European Securities and Markets Authority) shall notify their views to the Authority within 20 days from the date of the draft decision by the committee referred to in paragraph 7. Where they do not notify their views to the Authority within 20 days nor request a duly justified prolongation for notifying such views the agreement shall be presumed.
Article 9b
Request for investigation related to the prevention and countering of money laundering and of terrorist financing
Article 9c
No action letters
The Authority shall take the measures referred to in paragraph 2 of this Article only in exceptional circumstances when it considers that the application of one of the legislative acts referred to in Article 1(2), or of any delegated or implementing acts based on those legislative acts, is liable to raise significant issues, for one of the following reasons:
the Authority considers that provisions contained in such act may directly conflict with another relevant act;
where the act is one of the legislative acts referred to in Article 1(2), the absence of delegated or implementing acts that would complement or specify the act in question would raise legitimate doubts concerning the legal consequences flowing from the legislative act or its proper application;
the absence of guidelines and recommendations as referred to in Article 16 would raise practical difficulties concerning the application of the relevant legislative act.
In the cases referred to in points (a) and (b) of paragraph 1, the Authority shall provide the Commission with an opinion on any action it considers appropriate, in the form of a new legislative proposal or a proposal for a new delegated or implementing act, and on the urgency that, in the Authority’s judgment, is attached to the issue. The Authority shall make its opinion public.
In the case referred to in point (c) of paragraph 1 of this Article, the Authority shall evaluate as soon as possible the need to adopt relevant guidelines or recommendations in accordance with Article 16.
The Authority shall act expeditiously, in particular with a view to contributing to the prevention of the issues referred to in paragraph 1, whenever possible.
Article 10 is amended as follows:
paragraph 1 is amended as follows:
the first subparagraph is replaced by the following:
the third subparagraph is replaced by the following:
‘Before submitting them to the Commission, the Authority shall conduct open public consultations on draft regulatory technical standards and shall analyse the potential related costs and benefits, unless such consultations and analyses are highly disproportionate in relation to the scope and impact of the draft regulatory technical standards concerned or in relation to the particular urgency of the matter. The Authority shall also request the advice of the Banking Stakeholder Group referred to in Article 37.’;
the fourth subparagraph is deleted;
the fifth and the sixth subparagraphs are replaced by the following:
‘Within three months of receipt of a draft regulatory technical standard, the Commission shall decide whether to adopt it. The Commission shall inform the European Parliament and the Council in due time where the adoption cannot take place within the three-month period. The Commission may adopt the draft regulatory technical standard in part only, or with amendments, where the Union’s interests so require.
Where the Commission intends not to adopt a draft regulatory technical standard or to adopt it in part or with amendments, it shall send the draft regulatory technical standard back to the Authority, explaining why it does not adopt it or explaining the reasons for its amendments. The Commission shall send a copy of its letter to the European Parliament and to the Council. Within a period of six weeks, the Authority may amend the draft regulatory technical standard on the basis of the Commission’s proposed amendments and resubmit it in the form of a formal opinion to the Commission. The Authority shall send a copy of its formal opinion to the European Parliament and to the Council.’;
paragraph 2 is replaced by the following:
in paragraph 3, the second subparagraph is replaced by the following:
‘The Commission shall conduct open public consultations on draft regulatory technical standards and analyse the potential related costs and benefits, unless such consultations and analyses are disproportionate in relation to the scope and impact of the draft regulatory technical standards concerned or in relation to the particular urgency of the matter. The Commission shall also request the advice of the Banking Stakeholder Group referred to in Article 37.’;
paragraph 4 is replaced by the following:
in Article 13(1), the second subparagraph is deleted;
Article 15 is amended as follows:
paragraphs 1 and 2 are replaced by the following:
Before submitting draft implementing technical standards to the Commission, the Authority shall conduct open public consultations and shall analyse the potential related costs and benefits, unless such consultations and analyses are highly disproportionate in relation to the scope and impact of the draft implementing technical standards concerned or in relation to the particular urgency of the matter. The Authority shall also request the advice of the Banking Stakeholder Group referred to in Article 37.
Within three months of receipt of a draft implementing technical standard, the Commission shall decide whether to adopt it. The Commission may extend that period by one month. The Commission shall inform the European Parliament and the Council in due time where the adoption cannot take place within the three-month period. The Commission may adopt the draft implementing technical standard in part only, or with amendments, where the Union’s interests so require.
Where the Commission intends not to adopt a draft implementing technical standard or intends to adopt it in part or with amendments, it shall send it back to the Authority explaining why it does not intend to adopt it or explaining the reasons for its amendments. The Commission shall send a copy of its letter to the European Parliament and to the Council. Within a period of six weeks, the Authority may amend the draft implementing technical standard on the basis of the Commission’s proposed amendments and resubmit it in the form of a formal opinion to the Commission. The Authority shall send a copy of its formal opinion to the European Parliament and to the Council.
If, on the expiry of the six-week period referred to in the fourth subparagraph, the Authority has not submitted an amended draft implementing technical standard, or has submitted a draft implementing technical standard that is not amended in a way consistent with the Commission’s proposed amendments, the Commission may adopt the implementing technical standard with the amendments it considers relevant or reject it.
The Commission shall not change the content of a draft implementing technical standard prepared by the Authority without prior coordination with the Authority, as set out in this Article.
in paragraph 3, the second subparagraph is replaced by the following:
‘The Commission shall conduct open public consultations on draft implementing technical standards and analyse the potential related costs and benefits, unless such consultations and analyses are disproportionate in relation to the scope and impact of the draft implementing technical standards concerned or in relation to the particular urgency of the matter. The Commission shall also request the advice of the Banking Stakeholder Group referred to in Article 37.’;
paragraph 4 is replaced by the following:
Article 16 is amended as follows:
paragraphs 1 and 2 are replaced by the following:
Guidelines and recommendations shall be in accordance with the empowerments conferred by the legislative acts referred to in Article 1(2) or in this Article.
the following paragraph is inserted:
paragraph 4 is replaced by the following:
the following articles are inserted:
‘Article 16a
Opinions
Article 16b
Questions and answers
Before submitting a question to the Authority, financial institutions shall consider whether to address the question in the first place to their competent authority.
Before publishing answers to admissible questions, the Authority may seek further clarification on questions asked by the natural or legal person referred to in this paragraph.
Article 17 is amended as follows:
paragraph 2 is amended as follows:
the first subparagraph is replaced by the following:
the following subparagraphs are added:
‘Without prejudice to the powers laid down in Article 35, the Authority may, after having informed the competent authority concerned, address a duly justified and reasoned request for information directly to other competent authorities whenever requesting information from the competent authority concerned has proven, or is deemed to be, insufficient to obtain the information that is deemed necessary for the purpose of investigating an alleged breach or non-application of Union law.
The addressee of such a request shall provide the Authority with clear, accurate and complete information without undue delay.’;
the following paragraph is inserted:
paragraphs 6 and 7 are replaced by the following:
In matters concerning the prevention of the use of the financial system for the purpose of money laundering or of terrorist financing, where the relevant requirements of the legislative acts referred to in Article 1(2) are not directly applicable to financial sector operators, the Authority may adopt a decision requiring the competent authority to comply with the formal opinion referred to in paragraph 4 of this Article within the period specified therein. If the authority does not comply with that decision, the Authority may also adopt a decision in accordance with the first subparagraph. To that effect, the Authority shall apply all relevant Union law, and, where that Union law is composed of Directives, national law to the extent that it transposes those Directives. Where the relevant Union law is composed of Regulations and where those Regulations explicitly grant options for Member States, the Authority shall apply also national law to the extent that such options have been exercised.
The decision of the Authority shall be in conformity with the formal opinion issued by the Commission pursuant to paragraph 4.
When taking action in relation to issues which are subject to a formal opinion pursuant to paragraph 4 or to a decision pursuant to paragraph 6, competent authorities shall comply with the formal opinion or the decision, as the case may be.’;
the following article is inserted:
‘Article 17a
Protection of reporting persons
in Article 18, paragraph 3 is replaced by the following:
Article 19 is amended as follows:
paragraph 1 is replaced by the following:
In cases specified in the legislative acts referred to in Article 1(2) and without prejudice to the powers laid down in Article 17, the Authority may assist the competent authorities in reaching an agreement in accordance with the procedure set out in paragraphs 2 to 4 of this Article in either of the following circumstances:
at the request of one or more of the competent authorities concerned where a competent authority disagrees with the procedure or content of an action, proposed action, or inactivity of another competent authority;
in cases where the legislative acts referred to in Article 1(2) provide that the Authority may assist, on its own initiative, where on the basis of objective reasons, disagreement can be determined between competent authorities.
In cases where the legislative acts referred to in Article 1(2) require a joint decision to be taken by competent authorities and where, in accordance with those acts, the Authority may assist, on its own initiative, in reaching an agreement in accordance with the procedure set out in paragraphs 2 to 4 of this Article, the competent authorities concerned, a disagreement shall be presumed in the absence of a joint decision being taken by those authorities within the time limits set out in those acts.’;
the following paragraphs are inserted:
The competent authorities concerned shall, in the following cases, notify the Authority without undue delay that an agreement has not been reached:
where a time limit for reaching an agreement between competent authorities has been provided for in the legislative acts referred to in Article 1(2), and either of the following occurs:
the time limit has expired; or
at least two competent authorities concerned conclude that a disagreement exists, on the basis of objective reasons;
where no time limit for reaching an agreement between competent authorities has been provided for in the legislative acts referred to in Article 1(2), and either of the following occurs:
at least two competent authorities concerned conclude that a disagreement exists on the basis of objective reasons; or
two months have elapsed from the date of receipt by a competent authority of a request from another competent authority to take certain action in order to comply with those acts and the requested authority has not yet adopted a decision that satisfies the request.
Pending the Authority’s decision in accordance with the procedure set out in Article 44(3a), in cases where the legislative acts referred to in Article 1(2) require a joint decision to be taken, all competent authorities involved in the joint decision shall defer their individual decisions. Where the Authority decides to act, all the competent authorities involved in the joint decision shall defer their decisions until the procedure set out in paragraphs 2 and 3 of this Article is concluded.’;
paragraph 3 is replaced by the following:
‘Where the competent authorities concerned fail to reach an agreement within the conciliation phase referred to in paragraph 2, the Authority may take a decision requiring those authorities to take specific action, or to refrain from certain action, in order to settle the matter, and to ensure compliance with Union law. The decision of the Authority shall be binding on the competent authorities concerned. The Authority’s decision may require competent authorities to revoke or amend a decision that they have adopted or to make use of the powers which they have under the relevant Union law.’;
the following paragraph is inserted:
paragraph 4 is replaced by the following:
In matters concerning the prevention of the use of the financial system for the purpose of money laundering or of terrorist financing, the Authority may also adopt a decision in accordance with the first subparagraph of this paragraph where the relevant requirements of the legislative acts referred to in Article 1(2) are not directly applicable to financial sector operators. To that effect, the Authority shall apply all relevant Union law, and where such Union law is composed of Directives, national law to the extent that it transposes those Directives. Where the relevant Union law is composed of Regulations and where those Regulations explicitly grant options for Member States, the Authority shall apply also national law to the extent that such options have been exercised.’;
Article 21 is amended as follows:
paragraph 1 is replaced by the following:
in paragraph 2, third subparagraph, point (b) is replaced by the following:
initiate and coordinate Union-wide stress tests in accordance with Article 32 to assess the resilience of financial institutions, in particular the systemic risk posed by financial institutions as referred to in Article 23, to adverse market developments, and evaluate the potential for systemic risk to increase in situations of stress, ensuring that a consistent methodology is applied at national level to such tests and, where appropriate, address a recommendation to the competent authority to correct issues identified in the stress test, including a recommendation to conduct specific assessments; it may recommend competent authorities to carry out on-site inspections, and may participate in such on-site inspections, in order to ensure comparability and reliability of methods, practices and results of Union-wide assessments;’;
paragraph 3 is replaced by the following:
Article 22 is amended as follows:
the title is replaced by the following:
‘General provisions on systemic risk’;
in paragraph 2, the first subparagraph is replaced by the following:
paragraph 4 is replaced by the following:
Following an inquiry conducted pursuant to the first subparagraph, the Board of Supervisors may make appropriate recommendations for action to the competent authorities concerned.
For those purposes, the Authority may use the powers conferred on it under this Regulation, including Article 35.’;
in Article 23, paragraph 1 is replaced by the following:
in Article 27(2), the third subparagraph is deleted;
Article 29 is amended as follows:
paragraph 1 is amended as follows:
the following points are inserted:
establishing Union strategic supervisory priorities in accordance with Article 29a;
establishing coordination groups in accordance with Article 45b to promote supervisory convergence and identify best practices;’;
point (b) is replaced by the following:
promoting an effective bilateral and multilateral exchange of information between competent authorities, pertaining to all relevant issues, including cyber security and cyber-attacks, with full respect for the applicable confidentiality and data protection provisions provided for in the relevant Union legislative acts;’;
point (e) is replaced by the following:
establishing sectoral and cross-sectoral training programmes, including with respect to technological innovation, facilitating personnel exchanges and encouraging competent authorities to intensify the use of secondment schemes and other tools;’;
the following point is added:
putting in place a monitoring system to assess material environmental, social and governance-related risks, taking into account the Paris Agreement to the United Nations Framework Convention on Climate Change;’;
paragraph 2 is replaced by the following:
For the purpose of establishing a common supervisory culture, the Authority shall develop and maintain an up-to-date Union supervisory handbook on the supervision of financial institutions in the Union, which duly takes into account the nature, scale and complexity of risks, business practices, business models and the size of financial institutions and of markets. The Authority shall also develop and maintain an up-to-date Union resolution handbook on the resolution of financial institutions in the Union, which duly takes into account the nature, scale and complexity of risks, business practices, business models and the size of financial institutions and of markets. Both the Union supervisory handbook and the Union resolution handbook shall set out best practices and shall specify high-quality methodologies and processes.
The Authority shall, where appropriate, conduct open public consultations regarding the opinions referred to in point (a) of paragraph 1 and tools and instruments referred to in this paragraph. It shall also, where appropriate, analyse the related potential costs and benefits. Such consultations and analyses shall be proportionate in relation to the scope, nature and impact of the opinions or tools and instruments. The Authority shall, where appropriate, also request advice from the Banking Stakeholder Group referred to in Article 37.’;
the following article is inserted:
‘Article 29a
Union strategic supervisory priorities
Following a discussion in the Board of Supervisors and taking into account contributions received from competent authorities, existing work by the Union Institutions, and analysis, warnings and recommendations published by the ESRB, the Authority shall, at least every three years, by 31 March, identify up to two priorities of Union-wide relevance which shall reflect future developments and trends. Competent authorities shall take those priorities into account when drawing up their work programmes and shall notify the Authority accordingly. The Authority shall discuss the relevant activities by the competent authorities in the following year and draw conclusions. The Authority shall discuss possible follow-up which may include guidelines, recommendations to competent authorities, and peer reviews, in the respective area.
The priorities of Union-wide relevance identified by the Authority shall not prevent competent authorities from applying their best practices, acting on their additional priorities and developments, and national specificities shall be considered.’;
Article 30 is replaced by the following:
‘Article 30
Peer reviews of competent authorities
The peer review shall include an assessment of, but shall not be limited to:
the adequacy of resources, the degree of independence, and governance arrangements of the competent authority, with particular regard to the effective application of the legislative acts referred to in Article 1(2) and the capacity to respond to market developments;
the effectiveness and the degree of convergence reached in the application of Union law and in supervisory practice, including regulatory technical standards and implementing technical standards, guidelines and recommendations adopted pursuant to Articles 10 to 16, and the extent to which the supervisory practice achieves the objectives set out in Union law;
the application of best practices developed by competent authorities whose adoption might be of benefit for other competent authorities;
the effectiveness and the degree of convergence reached with regard to the enforcement of the provisions adopted in the implementation of Union law, including the administrative sanctions and other administrative measures imposed against persons responsible where those provisions have not been complied with.
In accordance with Article 16(3), the competent authorities shall make every effort to comply with any guidelines and recommendations issued.
When developing draft regulatory technical standards or draft implementing technical standards in accordance with Articles 10 to 15, or guidelines or recommendations in accordance with Article 16, the Authority shall take into account the outcome of the peer review, along with any other information acquired by the Authority in carrying out its tasks, in order to ensure convergence of the highest quality supervisory practices.
Article 31 is amended as follows:
the first paragraph is replaced by the following:
the second paragraph is amended as follows:
the introductory part is replaced by the following:
point (e) is replaced by the following:
taking appropriate measures in the event of developments which may jeopardise the functioning of the financial markets with a view to the coordination of actions undertaken by relevant competent authorities;’;
the following point is inserted:
taking appropriate measures to coordinate actions undertaken by relevant competent authorities with a view to facilitating the entry into the market of actors or products relying on technological innovation;’;
the following paragraph is added:
the following Article is inserted:
‘Article 31a
Information exchange on fitness and propriety
The Authority shall, together with the European Supervisory Authority (European Insurance and Occupational Pensions Authority) and with the European Supervisory Authority (European Securities and Markets Authority), establish a system for the exchange of information relevant to the assessment of the fitness and propriety of holders of qualifying holdings, directors and key function holders of financial institutions by competent authorities in accordance with the legislative acts referred to in Article 1(2).’;
Article 32 is amended as follows:
the title is replaced by the following:
‘Assessment of market developments, including stress tests’;
paragraph 1 is replaced by the following:
paragraph 2 is amended as follows:
the introductory part is replaced by the following:
point (a) is replaced by the following:
common methodologies for assessing the effect of economic scenarios on a financial institution’s financial position taking into account inter alia risks stemming from adverse environmental developments;’;
the following point is inserted:
common methodologies for identifying financial institutions to be included in Union-wide assessments;’;
points (c) and (d) are replaced by the following:
common methodologies for assessing the effect of particular products or distribution processes on a financial institution;
common methodologies for asset evaluation, as necessary, for the purpose of the stress testing; and’;
the following point is added:
common methodologies for assessing the effect of environmental risks on the financial stability of financial institutions.’;
the following subparagraph is added:
‘For the purposes of this paragraph, the Authority shall cooperate with the ESRB.’;
in paragraph 3, the first subparagraph is replaced by the following:
paragraph 3b is replaced by the following:
Article 33 is replaced by the following:
‘Article 33
International relations including equivalence
Where a third country, in accordance with a delegated act, which is in force, adopted by the Commission pursuant to Article 9 of Directive (EU) 2015/849, is on the list of jurisdictions which have strategic deficiencies in their national anti-money laundering and countering the financing of terrorism regimes that pose significant threats to the financial system of the Union, the Authority shall not conclude administrative arrangements with the regulatory, supervisory and, where applicable, resolution authorities of that third country. This shall not preclude other forms of cooperation between the Authority and the respective third-country authorities with a view to reduce threats to the financial system of the Union.
Furthermore, it shall verify whether the criteria, on the basis of which those equivalence decisions have been taken, and any conditions set out therein, are still fulfilled.
The Authority may liaise with relevant authorities in third countries. The Authority shall submit a confidential report to the European Parliament, to the Council, to the Commission and to the European Supervisory Authority (European Insurance and Occupational Pensions Authority) and the European Supervisory Authority (European Securities and Markets Authority) summarising the findings of its monitoring of all equivalent third countries. The report shall focus in particular on implications for financial stability, market integrity, investor protection or the functioning of the internal market.
Where the Authority identifies relevant developments in relation to the regulation, supervision or, where applicable, resolution, or the enforcement practices in the third countries referred to in this paragraph that may affect the financial stability of the Union or of one or more of its Member States, market integrity, investor protection or the functioning of the internal market, it shall inform the European Parliament, the Council and the Commission on a confidential basis and without undue delay.
Without prejudice to specific requirements set out in the legislative acts referred to in Article 1(2) and subject to the conditions set out in the second sentence of paragraph 1 of this Article, the Authority shall cooperate where possible with the relevant competent authorities, and where applicable, also with resolution authorities, of third countries whose regulatory and supervisory regimes have been recognised as equivalent. In principle, that cooperation shall be pursued on the basis of administrative arrangements concluded with the relevant authorities of those third countries. When negotiating such administrative arrangements, the Authority shall include provisions on the following:
the mechanisms which allow the Authority to obtain relevant information, including information on the regulatory regime, the supervisory approach, relevant market developments and any changes that may affect the equivalence decision;
to the extent necessary for the follow-up of such equivalence decisions, the procedures concerning the coordination of supervisory activities including, where necessary, on-site inspections.
The Authority shall inform the Commission where a third-country competent authority refuses to conclude such administrative arrangements or when it refuses to effectively cooperate.
In the report referred to in Article 43(5), the Authority shall include information on the administrative arrangements agreed upon with supervisory authorities, international organisations or administrations in third countries, the assistance provided by the Authority to the Commission in preparing equivalence decisions and the monitoring by the Authority in accordance with paragraph 3 of this Article.
Article 34 is deleted;
Article 36 is amended as follows:
paragraph 3 is deleted;
paragraphs 4 and 5 are replaced by the following:
It shall decide, by the relevant decision-making procedure, on any actions to be taken in accordance with the powers conferred upon it by this Regulation for addressing the issues identified in the warnings and recommendations.
If the Authority does not act on a warning or recommendation, it shall explain to the ESRB its reasons for not doing so. The ESRB shall inform the European Parliament thereof in accordance with Article 19(5) of Regulation (EU) No 1092/2010. The ESRB shall also inform the Council thereof.
Where the addressee intends not to follow the recommendation of the ESRB, it shall inform and discuss with the Board of Supervisors its reasons for not acting.
Where the competent authority, in accordance with Article 17(1) of Regulation (EU) No 1092/2010, informs the European Parliament, the Council, the Commission and the ESRB of the actions it has undertaken in response to a recommendation of the ESRB, it shall take due account of the views of the Board of Supervisors.’;
paragraph 6 is deleted;
Article 37 is amended as follows:
paragraphs 2 and 3 are replaced by the following:
The Banking Stakeholder Group shall be composed of 30 members. Those members shall comprise of:
13 members representing, in balanced proportions, financial institutions operating in the Union of whom three shall represent cooperative and savings banks;
13 members representing employees’ representatives of financial institutions operating in the Union, consumers, users of banking services and representatives of SMEs; and
four members who are independent top-ranking academics.
the following paragraph is inserted:
The European Parliament may invite the Chair of the Banking Stakeholder Group to make a statement before it and answer any questions from its members whenever so requested.’;
in paragraph 4, the first subparagraph is replaced by the following:
paragraph 5 is replaced by the following:
Where members of the Banking Stakeholder Group cannot agree on advice, one third of its members or the members representing one group of stakeholders shall be permitted to issue separate advice.
The Banking Stakeholder Group, the Securities and Markets Stakeholder Group, the Insurance and Reinsurance Stakeholder Group, and the Occupational Pensions Stakeholder Group may issue a joint advice on issues related to the work of the ESAs under Article 56 on joint positions and common acts.’;
paragraph 7 is replaced by the following:
Article 39 is replaced by the following:
‘Article 39
Decision-making procedures
Article 40 is amended as follows:
in paragraph 1, point (a) is replaced by the following:
the Chairperson;’;
the following paragraph is added:
Articles 41 and 42 are replaced by the following:
‘Article 41
Internal committees
Each member of the panel shall have one vote.
Decisions of the panel shall be taken where at least four members vote in favour.
Each member of the panel shall have one vote.
Decisions of the panel shall be taken where at least four members vote in favour.
Each member of the panel shall have one vote.
Decisions of the panel shall be taken where at least four members vote in favour.
Article 42
Independence of the Board of Supervisors
Article 43 is amended as follows:
paragraph 1 is replaced by the following:
paragraphs 2 and 3 are deleted;
paragraph 5 is replaced by the following:
paragraph 8 is replaced by the following:
the following Article is inserted:
‘Article 43a
Transparency of decisions adopted by the Board of Supervisors
Notwithstanding Article 70, within six weeks of each meeting of the Board of Supervisors, the Authority shall, at least provide the European Parliament with a comprehensive and meaningful record of the proceedings of that meeting that enables a full understanding of the discussions, including an annotated list of decisions. Such record shall not reflect discussions within the Board of Supervisors relating to individual financial institutions, unless otherwise provided for in Article 75(3) or in the legislative acts referred to in Article 1(2).’;
Article 44 is amended as follows:
paragraph 1 is replaced by the following:
With regard to the acts specified in Articles 10 to 16 of this Regulation and measures and decisions adopted under the third subparagraph of Article 9(5) of this Regulation, and Chapter VI of this Regulation and, by way of derogation from the first subparagraph of this paragraph, the Board of Supervisors shall take decisions on the basis of a qualified majority of its members, as defined in Article 16(4) TEU and in Article 3 of the Protocol No 36 on transitional provisions, which shall include at least a simple majority of the members, present at the vote, from competent authorities of Member States that are participating Member States as defined in point (1) of Article 2 of Regulation (EU) No 1024/2013 (“participating Member States”) and a simple majority of the members, present at the vote, from competent authorities of Member States that are not participating Member States (“non-participating Member States”).
The Chairperson shall not vote on the decisions referred to in the second subparagraph.
With regard to the composition of the panels in accordance with Article 41(2), (3) and (4), and the members of the peer review committee referred to in Article 30(2), the Board of Supervisors, when considering the proposals by its Chairperson, shall strive for consensus. In the absence of consensus, decisions of the Board of Supervisors shall be taken by a majority of three quarters of its voting members. Each voting member shall have one vote.
With regard to decisions adopted under Article 18(3) and (4), and by way of derogation from the first subparagraph of this paragraph, the Board of Supervisors shall take decisions on the basis of a simple majority of its voting members, which shall include a simple majority of its members from competent authorities of participating Member States and a simple majority of its members from competent authorities of non-participating Member States.’;
the following paragraphs are inserted:
By way of derogation from the first subparagraph, from the date when four or fewer voting members are from competent authorities of non-participating Member States, the decision proposed shall be adopted by a simple majority of the voting members of the Board of Supervisors, which shall include at least one vote from members from competent authorities of non-participating Member States.’;
paragraphs 4 and 4a are replaced by the following:
The first subparagraph shall not apply to the Executive Director and the European Central Bank representative nominated by its Supervisory Board.
Article 45 is replaced by the following:
‘Article 45
Composition
Other than the Chairperson, each member of the Management Board shall have an alternate, who may replace him or her if he or she is prevented from attending.
the following Articles are inserted:
‘Article 45a
Decision-making
Article 45b
Coordination Groups
Article 46 is replaced by the following:
‘Article 46
Independence of the Management Board
The members of the Management Board shall act independently and objectively in the sole interest of the Union as a whole and shall neither seek nor take instructions from the Union institutions or bodies, from any government or from any other public or private body.
Member States, Union institutions or bodies and any other public or private body shall not seek to influence the members of the Management Board in the performance of their tasks.’;
Article 47 is amended as follows:
the following paragraph is inserted:
paragraph 6 is replaced by the following:
paragraph 8 is replaced by the following:
the following paragraph is added:
Article 48 is amended as follows:
in paragraph 1, the second subparagraph is replaced by the following:
‘The Chairperson shall be responsible for preparing the work of the Board of Supervisors, including setting the agenda to be adopted by the Board of Supervisors, convening the meetings and tabling items for decision, and shall chair the meetings of the Board of Supervisors.
The Chairperson shall be responsible for setting the agenda of the Management Board, to be adopted by the Management Board, and shall chair the meetings of the Management Board.
The Chairperson may invite the Management Board to consider setting up a coordination group in accordance with Article 45b.’;
paragraph 2 is replaced by the following:
Where the Chairperson no longer fulfils the conditions referred to in Article 49 or has been found guilty of serious misconduct, the Council may, acting on a proposal from the Commission which has been approved by the European Parliament, adopt a decision to remove him or her from office.
The Board of Supervisors shall also elect, from among its members, a Vice-Chairperson who shall carry out the functions of the Chairperson in the absence of the Chairperson. That Vice-Chairperson shall not be elected from among the members of the Management Board.’;
in paragraph 4, the second subparagraph is replaced by the following:
‘For the purpose of the evaluation referred to in the first subparagraph, the tasks of the Chairperson shall be carried out by the Vice-Chairperson.
The Council, acting on a proposal from the Board of Supervisors and with the assistance of the Commission, and taking into account the evaluation referred to in the first subparagraph, may extend the term of office of the Chairperson once.’;
paragraph 5 is replaced by the following:
Article 49 is amended as follows:
the title is replaced by the following:
‘Independence of the Chairperson’;
the first paragraph is replaced by the following:
‘Without prejudice to the role of the Board of Supervisors in relation to the tasks of the Chairperson, the Chairperson shall neither seek nor take instructions from the Union institutions or bodies, from any government or from any other public or private body.’;
Article 49a is replaced by the following:
‘Article 49a
Expenses
The Chairperson shall make public all meetings held with external stakeholders within a period of two weeks following the meeting and any hospitality received. Expenses shall be recorded publicly in accordance with the Staff Regulations.’;
Article 50 is deleted;
Article 54 is amended as follows:
paragraph 2 is amended as follows:
the introductory part is replaced by the following:
the first indent is replaced by the following:
financial conglomerates and, where required by Union law, prudential consolidation,’;
the fifth and sixth indents are replaced by the following:
cybersecurity,
the following indents are added:
retail financial services and depositor, consumer and investor protection issues;
the following paragraph is inserted:
paragraph 3 is replaced by the following:
Article 55 is amended as follows:
paragraph 3 is replaced by the following:
in paragraph 4, the second subparagraph is replaced by the following:
‘The Joint Committee shall meet at least once every three months.’;
the following paragraph is added:
Articles 56 and 57 are replaced by the following:
‘Article 56
Joint positions and common acts
Within the scope of its tasks set out in Chapter II of this Regulation, and in particular with respect to the implementation of Directive 2002/87/EC, where relevant, the Authority shall reach joint positions by consensus with, as appropriate, the European Supervisory Authority (European Insurance and Occupational Pensions Authority) and with the European Supervisory Authority (European Securities and Markets Authority).
Where required by Union law, measures pursuant to Articles 10 to 16, and decisions pursuant to Articles 17, 18 and 19, of this Regulation in relation to the application of Directive 2002/87/EC and of any other legislative acts referred to in Article 1(2) of this Regulation that also fall within the area of competence of the European Supervisory Authority (European Insurance and Occupational Pensions Authority) or the European Supervisory Authority (European Securities and Markets Authority) shall be adopted, in parallel, by, as appropriate, the Authority, the European Supervisory Authority (European Insurance and Occupational Pensions Authority), and the European Supervisory Authority (European Securities and Markets Authority).
Article 57
Sub-Committees
Article 58 is amended as follows:
paragraph 1 is replaced by the following:
in paragraph 2, the first subparagraph is replaced by the following:
paragraph 3 is replaced by the following:
After having received the shortlist, the European Parliament may invite candidates for members and alternates to make a statement before it and answer any questions from its Members.
The European Parliament may invite the members of the Board of Appeal to make a statement before it and answer any questions from its Members whenever so requested, to the exclusion of statements, questions or answers pertaining to individual cases decided by, or pending before, the Board of Appeal.’;
in Article 59, paragraph 2 is replaced by the following:
in Article 60, paragraph 2 is replaced by the following:
The Board of Appeal shall decide upon the appeal within three months after the appeal has been lodged.’;
the following article is inserted:
‘Article 60a
Exceeding of competence by the Authority
Any natural or legal person may send reasoned advice to the Commission if that person is of the opinion that the Authority has exceeded its competence, including by failing to respect the principle of proportionality referred to in Article 1(5), when acting under Articles 16 and 16b, and that is of direct and individual concern to that person.’;
in Article 62, paragraph 1 is amended as follows:
the introductory part is replaced by the following:
the following points are added:
any voluntary contribution from Member States or observers;
agreed charges for publications, training and for any other services provided by the Authority where they have been specifically requested by one or more competent authorities.’;
the following sub-paragraph is added:
‘Any voluntary contribution from Member States or observers referred to in point (d) of the first sub-paragraph shall not be accepted if such acceptance would cast doubt on the independence and impartiality of the Authority. Voluntary contributions that constitute compensation for the cost of tasks delegated by a competent authority to the Authority shall not be considered to cast doubt on the independence of the latter.’;
Articles 63, 64 and 65 are replaced by the following:
‘Article 63
Establishment of the budget
Article 64
Implementation and control of the budget
The Authority’s accounting officer shall also send, by 15 June each year, a reporting package to the Commission’s accounting officer, in a standardised format as laid down by the Commission’s accounting officer for consolidation purposes.
Article 65
Financial rules
The financial rules applicable to the Authority shall be adopted by the Management Board after consulting the Commission. Those rules may not depart from Commission Delegated Regulation (EU) 2019/715 ( *23 ) unless the specific operational needs for the functioning of the Authority so require and only with the prior agreement of the Commission.
in Article 66, paragraph 1 is replaced by the following:
Article 70 is amended as follows:
paragraph 1 is replaced by the following:
in paragraph 2, the second subparagraph is replaced by the following:
‘The obligation under paragraph 1 of this Article and the first subparagraph of this paragraph shall not prevent the Authority and the competent authorities from using the information for the enforcement of the legislative acts referred to in Article 1(2), and in particular for legal procedures for the adoption of decisions.’;
the following paragraph is inserted:
The same requirements for professional secrecy shall also apply to observers who attend the meetings of the Management Board and the Board of Supervisors and who take part in the activities of the Authority.’;
paragraphs 3 and 4 are replaced by the following:
That information shall be subject to the conditions of professional secrecy referred to in paragraphs 1 and 2. The Authority shall lay down in its internal rules of procedure the practical arrangements for implementing the confidentiality rules referred to in paragraphs 1 and 2.
Article 71 is replaced by the following:
‘Article 71
Data protection
This Regulation shall be without prejudice to the obligations of Member States relating to their processing of personal data under Regulation (EU) 2016/679 or the obligations of the Authority relating to its processing of personal data under Regulation (EU) 2018/1725 of the European Parliament and of the Council ( *26 ) when fulfilling its responsibilities.
in Article 72, paragraph 2 is replaced by the following:
in Article 74, the first paragraph is replaced by the following:
‘The necessary arrangements concerning the accommodation to be provided for the Authority in the Member State where its seat is located and the facilities to be made available by that Member State, as well as the specific rules applicable in that Member State to the staff of the Authority and members of their families, shall be laid down in a Headquarters Agreement between the Authority and that Member State which they concluded after obtaining the approval of the Management Board.’;
Article 76 is replaced by the following:
‘Article 76
Relationship with the Committee of European Banking Supervisors
The Authority shall be considered the legal successor of Committee of European Banking Supervisors (CEBS). By the date of establishment of the Authority, all assets and liabilities and all pending operations of CEBS shall be automatically transferred to the Authority. CEBS shall establish a statement showing its closing asset and liability situation as of the date of that transfer. That statement shall be audited and approved by CEBS and by the Commission.’;
Article 81 is amended as follows:
paragraph 1 is amended as follows:
the introductory sentence is replaced by the following:
in point (a), the introductory sentence, and point (i) are replaced by the following:
the effectiveness and convergence in supervisory practices reached by competent authorities:
the independence of the competent authorities and convergence in standards equivalent to corporate governance;’;
the following points are added:
the functioning of the Joint Committee;
the obstacles to or impact on prudential consolidation pursuant to Article 8.’;
the following paragraphs are inserted:
Article 2
Amendments to Regulation (EU) No 1094/2010
Regulation (EU) No 1094/2010 is amended as follows:
Article 1 is amended as follows:
paragraphs 2 and 3 are replaced by the following:
The Authority shall contribute to the work of the European Supervisory Authority (European Banking Authority) established by Regulation (EU) No 1093/2010 of the European Parliament and of the Council ( *29 ) related to the prevention of the use of the financial system for the purpose of money laundering or terrorist financing in accordance with Directive (EU) 2015/849 of the European Parliament and of the Council ( *30 ) and Regulation (EU) No 1093/2010. The Authority shall decide on its agreement in accordance with Article 9a(9) of Regulation (EU) No 1093/2010.
paragraph 6 is amended as follows:
the first subparagraph is amended as follows:
ensuring that the taking of risks related to insurance, reinsurance and occupational pensions activities is appropriately regulated and supervised;
enhancing customer and consumer protection; and’;
enhancing supervisory convergence across the internal market.’;
the second subparagraph is replaced by the following:
‘For those purposes, the Authority shall contribute to ensuring the consistent, efficient and effective application of the acts referred to in paragraph 2 of this Article, foster supervisory convergence, and provide opinions in accordance with Article 16a to the European Parliament, to the Council, and to the Commission.’;
the fourth subparagraph is replaced by the following:
‘When carrying out its tasks, the Authority shall act independently, objectively and in a non-discriminatory and transparent manner, in the interests of the Union as a whole and shall respect, wherever relevant, the principle of proportionality. The Authority shall be accountable and act with integrity and shall ensure that all stakeholders are treated fairly.’;
the following subparagraph is added:
‘The content and form of the Authority’s actions and measures, in particular guidelines, recommendations, opinions, questions and answers, draft regulatory standards and draft implementing standards, shall fully respect the applicable provisions of this Regulation and of the legislative acts referred to in paragraph 2. To the extent permitted and relevant under those provisions, the Authority’s actions and measures shall, in accordance with the principle of proportionality, take due account of the nature, scale and complexity of the risks inherent in the business of a financial institution, undertaking, other subject or financial activity, that is affected by the Authority’s actions and measures.’;
the following paragraph is added:
Article 2 is amended as follows:
paragraph 1 is replaced by the following:
paragraph 4 is replaced by the following:
in paragraph 5, the following subparagraph is added:
‘Without prejudice to national competences, references in this Regulation to supervision shall include all relevant activities of all competent authorities to be carried out pursuant to the legislative acts referred to in Article 1(2).’;
Article 3 is replaced by the following:
‘Article 3
Accountability of the Authorities
in Article 4, point (2), point (ii) is replaced by the following:
with regard to Directive 2002/65/EC, the authorities and bodies competent for ensuring compliance with the requirements of that Directive by financial institutions;’;
In Article 7 the following paragraph is added:
‘The location of the seat of the Authority shall not affect the Authority’s execution of its tasks and powers, the organisation of its governance structure, the operation of its main organisation, or the main financing of its activities, while allowing, where applicable, for the sharing with Union agencies of administrative support services and facility management services which are not related to the core activities of the Authority.’;
Article 8 is amended as follows:
paragraph 1 is amended as follows:
point (a) is replaced by the following:
based on the legislative acts referred to in Article 1(2), to contribute to the establishment of high-quality common regulatory and supervisory standards and practices, in particular by developing draft regulatory and implementing technical standards, guidelines, recommendations, and other measures, including opinions;’;
the following point is inserted:
to develop and maintain an up-to-date Union supervisory handbook on the supervision of financial institutions in the Union which is to set out best practices and high-quality methodologies and processes, and takes into account, inter alia, changing business practices and business models and the size of financial institutions and of markets;’;
point (b) is replaced by the following:
to contribute to the consistent application of legally binding Union acts, in particular by contributing to a common supervisory culture, ensuring consistent, efficient and effective application of the legislative acts referred to in Article 1(2), preventing regulatory arbitrage, fostering and monitoring supervisory independence, mediating and settling disagreements between competent authorities, ensuring effective and consistent supervision of financial institutions, ensuring a coherent functioning of colleges of supervisors, and taking actions, inter alia, in emergency situations;’;
points (e) to (h) are replaced by the following:
to organise and conduct peer reviews of competent authorities, and, in that context, to issue guidelines and recommendations and to identify best practices, with a view to strengthening consistency in supervisory outcomes;
to monitor and assess market developments in the area of its competence including where relevant, developments relating to trends in insurance, reinsurance and occupational pensions, in particular, to households and SMEs and in innovative financial services duly considering developments relating to environmental, social and governance related factors;
to undertake market analyses to inform the discharge of the Authority’s functions;
to foster, where relevant, the protection of policyholders, pension scheme members and beneficiaries, consumers and investors, in particular with regards to shortcomings in a cross-border context and taking related risks into account;’;
the following point is inserted after point (i):
to contribute to the establishment of a common Union financial data strategy;’;
the following point is inserted after point (k):
to publish on its website, and to update regularly, all regulatory technical standards, implementing technical standards, guidelines, recommendations and questions and answers for each legislative act referred to in Article 1(2), including overviews that concern the state of play of ongoing work and the planned timing of the adoption of draft regulatory technical standards and draft implementing technical standards.’;
point (l) is deleted;
the following paragraph is inserted:
When carrying out its tasks in accordance with this Regulation, the Authority shall:
use the full powers available to it;
with due regard to the objective to ensure the safety and soundness of financial institutions, take fully into account the different types, business models and sizes of financial institutions; and
take account of technological innovation, innovative and sustainable business models such as cooperatives and mutuals, and the integration of environmental, social and governance related factors.’;
paragraph 2 is amended as follows:
the following points are inserted:
issue recommendations, as laid down in Article 29a;’,
issue warnings in accordance with Article 9(3);’;
point (g) is replaced by the following:
issue opinions to the European Parliament, to the Council, or to the Commission as provided for in Article 16a;’;
the following points are inserted:
issue answers to questions, as laid down in Article 16b;
take action in accordance with Article 9a;’;
the following paragraph is added:
The open public consultations referred to in Articles 10, 15, 16 and 16a shall be conducted as widely as possible to ensure an inclusive approach towards all interested parties and shall allow reasonable time for stakeholders to respond. The Authority shall publish a summary of the input received from stakeholders and an overview of how information and views gathered from the consultation were used in a draft regulatory technical standard and a draft implementing technical standard.’;
Article 9 is amended as follows:
paragraph 1 is amended as follows:
point (a) is replaced by the following:
collecting, analysing and reporting on consumer trends, such as the development of costs and charges of retail financial services and products in Member States;’;
the following points are inserted:
undertaking in-depth thematic reviews of market conduct, building a common understanding of markets practices in order to identify potential problems and analyse their impact;
developing retail risk indicators for the timely identification of potential causes of consumer and investor harm;’;
the following points are added:
contributing to a level playing field in the internal market where consumers and other users of financial services have fair access to financial services and products;
coordinating mystery shopping activities of competent authorities, if applicable.’;
paragraph 2 is replaced by the following:
paragraphs 4 and 5 are replaced by the following:
The Authority shall review the decision referred to in the first subparagraph at appropriate intervals and at least every six months. Following at least two consecutive renewals, and based on proper analysis which aims to assess the impact on the customer or consumer, the Authority may decide on the annual renewal of the prohibition.
A Member State may request the Authority to reconsider its decision. In that case, the Authority shall decide, in accordance with the procedure set out in the second subparagraph of Article 44(1), whether to maintain that decision.
The Authority may also assess the need to prohibit or restrict certain types of financial activity or practice and, where there is such a need, inform the Commission and the competent authorities in order to facilitate the adoption of any such prohibition or restriction.
the following article is inserted:
‘Article 9a
No action letters
The Authority shall take the measures referred to in paragraph 2 of this Article only in exceptional circumstances when it considers that the application of one of the legislative acts referred to in Article 1(2), or of any delegated or implementing acts based on those legislative acts, is liable to raise significant issues, for one of the following reasons:
the Authority considers that provisions contained in such act may directly conflict with another relevant act;
where the act is one of the legislative acts referred to in Article 1(2), the absence of delegated or implementing acts that would complement or specify the act in question would raise legitimate doubts concerning the legal consequences flowing from the legislative act or its proper application,
the absence of guidelines and recommendations as referred to in Article 16 would raise practical difficulties concerning the application of the relevant legislative act.
In the cases referred to in points (a) and (b) of paragraph 1, the Authority shall provide the Commission with an opinion on any action it considers appropriate, in the form of a new legislative proposal or a proposal for a new delegated or implementing act, and on the urgency that, in the Authority’s judgment, is attached to the issue. The Authority shall make its opinion public.
In the case referred to in point (c) of paragraph 1 of this Article, the Authority shall evaluate as soon as possible the need to adopt relevant guidelines or recommendations in accordance with Article 16.
The Authority shall act expeditiously, in particular with a view to contributing to the prevention of the issues referred to in paragraph 1, whenever possible.
Article 10 is amended as follows:
paragraph 1 is amended as follows:
the first subparagraph is replaced by the following:
the third subparagraph is replaced by the following:
‘Before submitting them to the Commission, the Authority shall conduct open public consultations on draft regulatory technical standards and shall analyse the potential related costs and benefits, unless such consultations and analyses are highly disproportionate in relation to the scope and impact of the draft regulatory technical standards concerned or in relation to the particular urgency of the matter. The Authority shall also request the advice of the relevant Stakeholder Group referred to in Article 37.’;
the fourth subparagraph is deleted;
the fifth and the sixth subparagraphs are replaced by the following:
‘Within three months of receipt of a draft regulatory technical standard, the Commission shall decide whether to adopt it. The Commission shall inform the European Parliament and the Council in due time where the adoption cannot take place within the three-month period. The Commission may adopt the draft regulatory technical standard in part only, or with amendments, where the Union’s interests so require.
Where the Commission intends not to adopt a draft regulatory technical standard or to adopt it in part or with amendments, it shall send the draft regulatory technical standard back to the Authority, explaining why it does not adopt it, or explaining the reasons for its amendments. The Commission shall send a copy of its letter to the European Parliament and to the Council. Within a period of six weeks, the Authority may amend the draft regulatory technical standard on the basis of the Commission’s proposed amendments and resubmit it in the form of a formal opinion to the Commission. The Authority shall send a copy of its formal opinion to the European Parliament and to the Council.’;
paragraph 2 is replaced by the following:
in paragraph 3, the second subparagraph is replaced by the following:
‘The Commission shall conduct open public consultations on draft regulatory technical standards and analyse the potential related costs and benefits, unless such consultations and analyses are disproportionate in relation to the scope and impact of the draft regulatory technical standards concerned or in relation to the particular urgency of the matter. The Commission shall also request the advice of the relevant Stakeholder Group referred to in Article 37.’;
paragraph 4 is replaced by the following:
in Article 13(1), the second subparagraph is deleted;
Article 15 is amended as follows:
paragraphs 1 and 2 are replaced by the following:
Before submitting draft implementing technical standards to the Commission, the Authority shall conduct open public consultations and shall analyse the potential related costs and benefits, unless such consultations and analyses are highly disproportionate in relation to the scope and impact of the draft implementing technical standards concerned or in relation to the particular urgency of the matter. The Authority shall also request the advice of the relevant Stakeholder Group referred to in Article 37.
Within three months of receipt of a draft implementing technical standard, the Commission shall decide whether to adopt it. The Commission may extend that period by one month. The Commission shall inform the European Parliament and the Council in due time where the adoption cannot take place within the three-month period. The Commission may adopt the draft implementing technical standard in part only, or with amendments, where the Union’s interests so require.
Where the Commission intends not to adopt a draft implementing technical standard or intends to adopt it in part or with amendments, it shall send it back to the Authority explaining why it does not intend to adopt it, or explaining the reasons for its amendments. The Commission shall send a copy of its letter to the European Parliament and to the Council. Within a period of six weeks, the Authority may amend the draft implementing technical standard on the basis of the Commission’s proposed amendments and resubmit it in the form of a formal opinion to the Commission. The Authority shall send a copy of its formal opinion to the European Parliament and to the Council.
If, on the expiry of the six-week period referred to in the fourth subparagraph, the Authority has not submitted an amended draft implementing technical standard, or has submitted a draft implementing technical standard that is not amended in a way consistent with the Commission’s proposed amendments, the Commission may adopt the implementing technical standard with the amendments it considers relevant or reject it.
The Commission shall not change the content of a draft implementing technical standard prepared by the Authority without prior coordination with the Authority, as set out in this Article.
in paragraph 3, the second subparagraph is replaced by the following:
‘The Commission shall conduct open public consultations on draft implementing technical standards and analyse the potential related costs and benefits, unless such consultations and analyses are disproportionate in relation to the scope and impact of the draft implementing technical standards concerned or in relation to the particular urgency of the matter. The Commission shall also request the advice of the relevant Stakeholder Group referred to in Article 37.’;
paragraph 4 is replaced by the following:
Article 16 is amended as follows:
paragraphs 1 and 2 are replaced by the following:
Guidelines and recommendations shall be in accordance with the empowerments conferred in the legislative acts referred to in Article 1(2) or in this Article.
the following paragraph is inserted:
paragraph 4 is replaced by the following:
the following articles are inserted:
‘Article 16a
Opinions
Article 16b
Questions and answers
Before submitting a question to the Authority, financial institutions shall consider whether to address the question in the first place to their competent authority.
Before publishing answers to admissible questions, the Authority may seek further clarification on questions asked by the natural or legal person referred to in this paragraph.
Article 17 is amended as follows:
paragraph 2 is amended as follows:
the first subparagraph is replaced by the following:
the following subparagraphs are added:
‘Without prejudice to the powers laid down in Article 35, the Authority may, after having informed the competent authority concerned, address a duly justified and reasoned request for information directly to other competent authorities whenever requesting information from the competent authority concerned has proven, or is deemed to be, insufficient to obtain the information that is deemed necessary for the purpose of investigating an alleged breach or non-application of Union law.
The addressee of such a request shall provide the Authority with clear, accurate and complete information without undue delay.’;
the following paragraph is inserted:
paragraphs 6 and 7 are replaced by the following:
The decision of the Authority shall be in conformity with the formal opinion issued by the Commission pursuant to paragraph 4.
When taking action in relation to issues which are subject to a formal opinion pursuant to paragraph 4 or to a decision pursuant to paragraph 6, competent authorities shall comply with the formal opinion or the decision, as the case may be.’;
the following article is inserted:
‘Article 17a
Protection of reporting persons
in Article 18, paragraph 3 is replaced by the following:
Article 19 is amended as follows:
paragraph 1 is replaced by the following:
In cases specified in the legislative acts referred to in Article 1(2) and without prejudice to the powers laid down in Article 17, the Authority may assist the competent authorities in reaching an agreement in accordance with the procedure set out in paragraphs 2 to 4 of this Article in either of the following circumstances:
at the request of one or more of the competent authorities concerned where a competent authority disagrees with the procedure or content of an action, proposed action, or inactivity of another competent authority;
in cases where the legislative acts referred to in Article 1(2) provide that the Authority may assist, on its own initiative, where on the basis of objective reasons, disagreement can be determined between competent authorities.
In cases where the legislative acts referred to in Article 1(2) require a joint decision to be taken by competent authorities, and where in accordance with those acts the Authority may assist, on its own initiative in reaching an agreement in accordance with the procedure set out in paragraphs 2 to 4 of this Article, the competent authorities concerned, a disagreement shall be presumed in the absence of a joint decision being taken by those authorities within the time limits set out in those acts.’;
the following paragraphs are inserted:
The competent authorities concerned shall, in the following cases, notify the Authority without undue delay that an agreement has not been reached:
where a time limit for reaching an agreement between competent authorities has been provided for in the legislative acts referred to in Article 1(2), and either of the following occurs:
the time limit has expired; or
at least two competent authorities concerned conclude that a disagreement exists, on the basis of objective reasons;
where no time limit for reaching an agreement between competent authorities has been provided for in the legislative acts referred to in Article 1(2), and either of the following occurs:
at least two competent authorities concerned conclude that a disagreement exists on the basis of objective reasons; or
two months have elapsed from the date of receipt by a competent authority of a request from another competent authority to take certain action in order to comply with those acts and the requested authority has not yet adopted a decision that satisfies the request.
Pending the Authority’s decision in accordance with the procedure set out in Article 44(4), in cases where the legislative acts referred to in Article 1(2) require a joint decision to be taken, all competent authorities involved in the joint decision shall defer their individual decisions. Where the Authority decides to act, all the competent authorities involved in the joint decision shall defer their decisions until the procedure set out in paragraphs 2 and 3 of this Article is concluded.’;
paragraph 3 is replaced by the following:
the following paragraph is inserted:
paragraph 4 is replaced by the following:
Article 21 is amended as follows:
paragraph 1 is replaced by the following:
paragraph 2 is amended as follows:
the first subparagraph is replaced by the following:
in the third subparagraph, point (b) is replaced by the following:
initiate and coordinate Union-wide stress tests in accordance with Article 32 to assess the resilience of financial institutions, in particular the systemic risk posed by financial institutions as referred to in Article 23, to adverse market developments, and evaluate the potential for systemic risk to increase in situations of stress, ensuring that a consistent methodology is applied at national level to such tests and, where appropriate, address a recommendation to the competent authority to correct issues identified in the stress test, including a recommendation to conduct specific assessments; it may recommend competent authorities to carry out on-site inspections, and may participate in such on-site inspections, in order to ensure comparability and reliability of methods, practices and results of Union-wide assessments;’;
paragraph 3 is replaced by the following:
Article 22 is amended as follows:
the title is replaced by the following:
‘General provisions on systemic risk’;
in paragraph 2, the first subparagraph is replaced by the following:
paragraph 4 is replaced by the following:
Following an inquiry conducted pursuant to the first subparagraph, the Board of Supervisors may make appropriate recommendations for action to the competent authorities concerned.
For those purposes, the Authority may use the powers conferred on it under this Regulation, including Article 35.’;
in Article 23, paragraph 1 is replaced by the following:
Article 29 is amended as follows:
paragraph 1 is amended as follows:
the following points are inserted:
establishing Union strategic supervisory priorities in accordance with Article 29a;
establishing coordination groups in accordance with Article 45b to promote supervisory convergence and identify best practices;’;
point (b) is replaced by the following:
promoting an effective bilateral and multilateral exchange of information between competent authorities, pertaining to all relevant issues, including cyber security and cyber-attacks, with full respect for the applicable confidentiality and data protection provisions provided for in the relevant Union legislative acts;’;
point (e) is replaced by the following:
establishing sectoral and cross-sectoral training programmes, including with respect to technological innovation, different forms of cooperatives and mutuals, facilitating personnel exchanges and encouraging competent authorities to intensify the use of secondment schemes and other tools;’;
the following point is added:
putting in place a monitoring system to assess material environmental, social and governance-related risks, taking into account the Paris Agreement to the United Nations Framework Convention on Climate Change;’;
paragraph 2 is replaced by the following:
For the purpose of establishing a common supervisory culture, the Authority shall develop and maintain an up-to-date Union supervisory handbook on the supervision of financial institutions in the Union, which duly takes into account the nature, scale and complexity of risks, business practices, business models and size of financial institutions and of markets. The Union supervisory handbook shall set out best practices and shall specify high- quality methodologies and processes.
The Authority shall, where appropriate, conduct open public consultations regarding the opinions referred to in point (a) of paragraph 1, tools and instruments referred to in this paragraph. It shall also, where appropriate, analyse the related potential costs and benefits. Such consultations and analyses shall be proportionate in relation to the scope, nature and impact of the opinions or tools and instruments. The Authority shall, where appropriate, also request advice from the relevant Stakeholder Group referred to in Article 37.’;
the following Article is inserted:
‘Article 29a
Union strategic supervisory priorities
Following a discussion in the Board of Supervisors and taking into account contributions received from competent authorities, existing work by the Union institutions, and analysis, warnings and recommendations published by the ESRB, the Authority shall, at least every three years, by 31 March, identify up to two priorities of Union-wide relevance which shall reflect future developments and trends. Competent authorities shall take those priorities into account when drawing up their work programmes and shall notify the Authority accordingly. The Authority shall discuss the relevant activities by the competent authorities in the following year and draw conclusions. The Authority shall discuss possible follow up which may include guidelines, recommendations to competent authorities, and peer reviews, in the respective area.
The priorities of Union-wide relevance identified by the Authority shall not prevent competent authorities from applying their best practices, acting on their additional priorities and developments, and national specificities shall be considered.’;
Article 30 is replaced by the following:
‘Article 30
Peer reviews of competent authorities
The peer review shall include an assessment of, but shall not be limited to:
the adequacy of resources, the degree of independence, and governance arrangements of the competent authority, with particular regard to the effective application of the legislative acts referred to in Article 1(2) and the capacity to respond to market developments;
the effectiveness and the degree of convergence reached in the application of Union law and in supervisory practice, including regulatory technical standards and implementing technical standards, guidelines and recommendations adopted pursuant to Articles 10 to 16, and the extent to which the supervisory practice achieves the objectives set out in Union law;
the application of best practices developed by competent authorities whose adoption might be of benefit for other competent authorities;
the effectiveness and the degree of convergence reached with regard to the enforcement of the provisions adopted in the implementation of Union law, including the administrative sanctions and other administrative measures imposed against persons responsible where those provisions have not been complied with.
In accordance with Article 16(3), the competent authorities shall make every effort to comply with any guidelines and recommendations issued.
When developing draft regulatory technical standards or draft implementing technical standards in accordance with Articles 10 to 15, or guidelines or recommendations in accordance with Article 16, the Authority shall take into account the outcome of the peer review, along with any other information acquired by the Authority in carrying out its tasks, in order to ensure convergence of the highest quality supervisory practices.
Article 31 is amended as follows:
the first paragraph is replaced by the following:
the second paragraph is amended as follows:
the introductory part is replaced by the following:
point (e) is replaced by the following:
taking appropriate measures in the event of developments which may jeopardise the functioning of the financial markets with a view to the coordination of actions undertaken by relevant competent authorities;’;
the following point is inserted:
taking appropriate measures to coordinate actions undertaken by relevant competent authorities with a view to facilitating the entry into the market of actors or products relying on technological innovation;’;
the following paragraph is added:
the following Article is inserted:
‘Article 31a
Information exchange on fitness and propriety
The Authority shall, together with the European Supervisory Authority (European Banking Authority) and with the European Supervisory Authority (European Securities and Markets Authority), establish a system for the exchange of information relevant to the assessment of the fitness and propriety of holders of qualifying holdings, directors and key function holders of financial institutions by competent authorities in accordance with the legislative acts referred to in Article 1(2).’;
Article 32 is amended as follows:
the title is replaced by the following:
‘Assessment of market developments, including stress tests’;
paragraph 1 is replaced by the following:
paragraph 2 is amended as follows:
the introductory part is replaced by the following:
point (a) is replaced by the following:
common methodologies for assessing the effect of economic scenarios on a financial institution’s financial position taking into account inter alia risks stemming from adverse environmental developments;’;
the following point is inserted:
common methodologies for identifying financial institutions to be included in Union-wide assessments;’;
the following point is added:
common methodologies for assessing the effect of environmental risks on the financial stability of financial institutions.’;
the following subparagraph is added:
‘For the purposes of this paragraph, the Authority shall cooperate with the ESRB.’;
in paragraph 3, the first subparagraph is replaced by the following:
Article 33 is replaced by the following:
‘Article 33
International relations including equivalence
Where a third country, in accordance with a delegated act, which is in force, adopted by the Commission pursuant to Article 9 of Directive (EU) 2015/849, is on the list of jurisdictions which have strategic deficiencies in their national anti-money laundering and in countering the financing of terrorism regimes that pose significant threats to the financial system of the Union, the Authority shall not conclude administrative arrangements with the regulatory and supervisory authorities of that third country. This shall not preclude other forms of cooperation between the Authority and the respective third-country authorities with a view to reducing threats to the financial system of the Union.
Furthermore, it shall verify whether the criteria on the basis of which those equivalence decisions have been taken, and any conditions set out therein are still fulfilled.
The Authority may liaise with relevant authorities in third countries. The Authority shall submit a confidential report to the European Parliament, to the Council, to the Commission and to the European Supervisory Authority (European Banking Authority) and to the European Supervisory Authority (European Securities and Markets Authority) summarising the findings of its monitoring of all equivalent third countries. The report shall focus in particular on implications for financial stability, market integrity, policy holder protection or the functioning of the internal market.
Where the Authority identifies relevant developments in relation to the regulation and supervision or the enforcement practices in the third countries referred to in this paragraph that may affect the financial stability of the Union or of one or more of its Member States, market integrity, policy holder protection or the functioning of the internal market, it shall inform the European Parliament, the Council and the Commission on a confidential basis and without undue delay.
Without prejudice to specific requirements set out in the legislative acts referred to in Article 1(2) and subject to the conditions set out in the second sentence of paragraph 1 of this Article, the Authority shall cooperate where possible with the relevant competent authorities of third countries whose regulatory and supervisory regimes have been recognised as equivalent. In principle, that cooperation shall be pursued on the basis of administrative arrangements concluded with the relevant authorities of those third countries. When negotiating such administrative arrangements, the Authority shall include provisions on the following:
the mechanisms which allow the Authority to obtain relevant information, including information on the regulatory regime, the supervisory approach, relevant market developments and any changes that may affect the equivalence decision;
to the extent necessary for the follow-up of such equivalence decisions, the procedures concerning the coordination of supervisory activities including, where necessary, on-site inspections
The Authority shall inform the Commission, where a third-country competent authority refuses to conclude such administrative arrangements or when it refuses to effectively cooperate.
In the report referred to in Article 43(5), the Authority shall include information on the administrative arrangements agreed upon with supervisory authorities, international organisations or administrations in third countries, the assistance provided by the Authority to the Commission in preparing equivalence decisions and the monitoring by the Authority in accordance with paragraph 3 of this Article.
Article 34 is deleted;
Article 36 is amended as follows:
paragraph 3 is deleted;
paragraphs 4 and 5 are replaced by the following:
It shall decide, by the relevant decision-making procedure, on any actions to be taken in accordance with the powers conferred upon it by this Regulation for addressing the issues identified in the warnings and recommendations.
If the Authority does not act on a warning or recommendation, it shall explain to the ESRB its reasons for not doing so. The ESRB shall inform the European Parliament thereof in accordance with Article 19(5) of Regulation (EU) No 1092/2010. The ESRB shall also inform the Council thereof.
Where the addressee intends not to follow the recommendation of the ESRB, it shall inform and discuss with the Board of Supervisors its reasons for not acting.
Where the competent authority, in accordance with Article 17(1) of Regulation (EU) No 1092/2010, informs the European Parliament, the Council, the Commission and the ESRB of the actions it has undertaken in response to a recommendation of the ESRB, it shall take due account of the views of the Board of Supervisors.’;
paragraph 6 is deleted;
Article 37 is amended as follows:
paragraphs 2, 3 and 4 are replaced by the following:
The Insurance and Reinsurance Stakeholder Group shall be composed of 30 members. Those members shall comprise of:
13 members representing, in balanced proportions, insurance and reinsurance undertakings and insurance intermediaries operating in the Union, of whom three shall represent cooperative and mutual insurers or reinsurers;
13 members representing employees’ representatives of insurance and reinsurance undertakings and insurance intermediaries operating in the Union, consumers, users of insurance and reinsurance services, representatives of SMEs and representatives of relevant professional associations; and
four members who are independent top-ranking academics.
The Occupational Pensions Stakeholder Group shall be composed of 30 members. Those members shall comprise of:
13 members representing in balanced proportions institutions for occupational retirement provision operating in the Union;
13 members representing representatives of employees, representatives of beneficiaries, representatives of SMEs and representatives of relevant professional associations; and
four members who are independent top-ranking academics.
the following paragraph is inserted:
The European Parliament may invite the Chair of any Stakeholder Group to make a statement before it and answer any questions from its members whenever so requested.’;
in paragraphs 5, the first subparagraph is replaced by the following:
paragraph 6 is replaced by the following:
Where members of the Stakeholder Groups cannot agree on advice, one third of their members or the members representing one group of stakeholders shall be permitted to issue separate advice.
The Insurance and Reinsurance Stakeholder Group, the Occupational Pensions Stakeholder Group, the Banking Stakeholder Group, and the Securities and Markets Stakeholder Group may issue joint advice on issues related to the work of the ESAs under Article 56 on joint positions and common acts.’;
paragraph 8 is replaced by the following:
Article 39 is replaced by the following:
‘Article 39
Decision-making procedures
Article 40 is amended as follows
in paragraph 1, point (a) is replaced by the following:
the Chairperson;’;
the following paragraph is added:
Articles 41 and 42 are replaced by the following:
‘Article 41
Internal committees
Each member of the panel shall have one vote.
Decisions of the panel shall be taken where at least four members vote in favour.
Each member of the panel shall have one vote.
Decisions of the panel shall be taken where at least four members vote in favour.
Each member of the panel shall have one vote.
Decisions of the panel shall be taken where at least four members vote in favour.
Article 42
Independence of the Board of Supervisors
Article 43 is amended as follows:
paragraph 1 is replaced by the following:
paragraphs 2 and 3 are deleted;
paragraph 5 is replaced by the following:
paragraph 8 is replaced by the following:
the following Article is inserted:
‘Article 43a
Transparency of decisions adopted by the Board of Supervisors
Notwithstanding Article 70, within six weeks of each meeting of the Board of Supervisors, the Authority shall, at least, provide the European Parliament with a comprehensive and meaningful record of the proceedings of that meeting that enables a full understanding of the discussions, including an annotated list of decisions. Such record shall not reflect discussions within the Board of Supervisors relating to individual financial institutions, unless otherwise provided for in Article 75(3) or in the legislative acts referred to in Article 1(2).’;
Article 44 is amended as follows:
paragraph 1 is replaced by the following:
With regard to the acts specified in Articles 10 to 16 of this Regulation and measures and decisions adopted under the third subparagraph of Article 9(5) of this Regulation and Chapter VI of this Regulation and, by way of derogation from the first subparagraph of this paragraph, the Board of Supervisors shall take decisions on the basis of a qualified majority of its members, as defined in Article 16(4) of the Treaty on European Union and in Article 3 of the Protocol No 36 on transitional provisions.
The Chairperson shall not vote on the decisions referred to in the second subparagraph.
With regard to the composition of the panels in accordance with Article 41(2), (3) and (4), and the members of the peer review committee referred to in Article 30(2), the Board of Supervisors, when considering the proposals by the Chairperson, shall strive for consensus. In the absence of consensus, decisions of the Board of Supervisors shall be taken by a majority of three quarters of its voting members. Each voting member shall have one vote.
With regard to decisions adopted under Article 18(3) and (4), and by way of derogation from the first subparagraph of this paragraph, the Board of Supervisors shall take decisions on the basis of a simple majority of its voting members.’;
paragraph 4 is replaced by the following:
The non-voting members and the observers, with the exception of the Executive Director, shall not attend any discussions within the Board of Supervisors relating to individual financial institutions, unless otherwise provided for in Article 75(3) or in the legislative acts referred to in Article 1(2).’;
the following paragraph is added:
Article 45 is replaced by the following:
‘Article 45
Composition
Other than the Chairperson, each member of the Management Board shall have an alternate who may replace him if he is prevented from attending.
the following Articles are inserted:
‘Article 45a
Decision-making
Article 45b
Coordination Groups
Article 46 is replaced by the following:
‘Article 46
Independence of the Management Board
The members of the Management Board shall act independently and objectively in the sole interest of the Union as a whole and shall neither seek nor take instructions from the Union institutions or bodies, from any government or from any other public or private body.
Member States, Union institutions or bodies and any other public or private body shall not seek to influence the members of the Management Board in the performance of their tasks.’;
Article 47 is amended as follows:
the following paragraph is inserted:
paragraph 6 is replaced by the following:
paragraph 8 is replaced by the following:
the following paragraph is added:
Article 48 is amended as follows:
in paragraph 1, the second subparagraph is replaced by the following:
‘The Chairperson shall be responsible for preparing the work of the Board of Supervisors, including setting the agenda to be adopted by the Board of Supervisors, convening the meetings and tabling items for decision, and shall chair the meetings of the Board of Supervisors.
The Chairperson shall be responsible for setting the agenda of the Management Board, to be adopted by the Management Board, and shall chair the meetings of the Management Board.
The Chairperson may invite the Management Board to consider setting up a coordination group in accordance with Article 45b.’;
paragraph 2 is replaced by the following:
Where the Chairperson no longer fulfils the conditions referred to in Article 49 or has been found guilty of serious misconduct, the Council may, acting on a proposal from the Commission which has been approved by the European Parliament, adopt a decision to remove him or her from office.
The Board of Supervisors shall also elect, from among its members, a Vice-Chairperson who shall carry out the functions of the Chairperson in the absence of the Chairperson. That Vice-Chairperson shall not be elected from among the members of the Management Board.’;
in paragraph 4, the second subparagraph is replaced by the following:
‘For the purpose of the evaluation referred to in the first subparagraph, the tasks of the Chairperson shall be carried out by the Vice-Chairperson.
The Council, acting on a proposal from the Board of Supervisors and with the assistance of the Commission, and taking into account the evaluation referred to in the first subparagraph, may extend the term of office of the Chairperson once.’;
paragraph 5 is replaced by the following:
Article 49 is amended as follows:
the title is replaced by the following:
‘Independence of the Chairperson’;
the first paragraph is replaced by the following:
‘Without prejudice to the role of the Board of Supervisors in relation to the tasks of the Chairperson, the Chairperson shall neither seek nor take instructions from the Union institutions or bodies, from any government or from any other public or private body.’;
the following article is inserted:
‘Article 49a
Expenses
The Chairperson shall make public all meetings held with external stakeholders within a period of two weeks following the meeting and any hospitality received. Expenses shall be recorded publicly in accordance with the Staff Regulations.’;
Article 50 is deleted;
Article 54 is amended as follows:
paragraph 2 is amended as follows:
the introductory part is replaced by the following:
the first indent is replaced by the following:
financial conglomerates and, where required by Union law, prudential consolidation,’;
the fifth indent is replaced by the following:
cybersecurity,’;
the sixth indent is replaced by the following:
information and best practice exchange with the ESRB and the other ESAs,’;
the following indents are added:
retail financial services and consumer and investor protection issues;
the following paragraph is inserted:
paragraph 3 is replaced by the following:
Article 55 is amended as follows:
paragraph 3 is replaced by the following:
in paragraph 4, the second subparagraph is replaced by the following:
‘The Joint Committee shall meet at least once every three months.’;
the following paragraph is added:
Articles 56 and 57 are replaced by the following:
‘Article 56
Joint positions and common acts
Within the scope of its tasks set out in Chapter II of this Regulation, and in particular with respect to the implementation of Directive 2002/87/EC, where relevant, the Authority shall reach joint positions by consensus with, as appropriate, the European Supervisory Authority (European Banking Authority) and with the European Supervisory Authority (European Securities and Markets Authority).
Where required by Union law, measures pursuant to Articles 10 to 16, and decisions pursuant to Articles 17, 18 and 19, of this Regulation in relation to the application of Directive 2002/87/EC and of any other legislative acts referred to in Article 1(2) of this Regulation that also fall within the area of competence of the European Supervisory Authority (European Banking Authority) or the European Supervisory Authority (European Securities and Markets Authority) shall be adopted, in parallel, by, as appropriate, the Authority, the European Supervisory Authority (European Banking Authority) and the European Supervisory Authority (European Securities and Markets Authority).
Article 57
Sub-Committees
Article 58 is amended as follows:
paragraph 1 is replaced by the following:
in paragraph 2, the first subparagraph is replaced by the following:
paragraph 3 is replaced by the following:
After having received the shortlist, the European Parliament may invite candidates for members and alternates to make a statement before it and answer any questions from its Members.
The European Parliament may invite the members of the Board of Appeal to make a statement before it and answer any questions from its Members whenever so requested, to the exclusion of statements, questions or answers pertaining to individual cases decided by, or pending before, the Board of Appeal.’;
in Article 59, paragraph 2 is replaced by the following:
in Article 60, paragraph 2 is replaced by the following:
The Board of Appeal shall decide upon the appeal within three months after the appeal has been lodged.’;
the following article is inserted:
‘Article 60a
Exceeding of competence by the Authority
Any natural or legal person may send reasoned advice to the Commission if that person is of the opinion that the Authority has exceeded its competence, including by failing to respect the principle of proportionality referred to in Article 1(5), when acting under Articles 16 and 16b, and that is of direct and individual concern to that person.’;
in Article 62, paragraph 1 is amended as follows:
the introductory part is replaced by the following:
the following points are added:
any voluntary contribution from Member States or observers;
agreed charges for publications, training and for any other services provided by the Authority where they have been specifically requested by one or more competent authorities.’;
the following sub-paragraph is added:
‘Any voluntary contribution from Member States or observers referred to in point d of the first sub-paragraph shall not be accepted if such acceptance would cast doubt on the independence and impartiality of the Authority. Voluntary contributions that constitute compensation for the cost of tasks delegated by a competent authority to the Authority shall not be considered to cast doubt on the independence of the latter.’;
Articles 63, 64 and 65 are replaced by the following:
‘Article 63
Establishment of the budget
Article 64
Implementation and control of the budget
The Authority’s accounting officer shall also send, by 15 June each year, a reporting package to the Commission’s accounting officer, in a standardised format as laid down by the Commission’s accounting officer for consolidation purposes.
Article 65
Financial rules
The financial rules applicable to the Authority shall be adopted by the Management Board after consulting the Commission. Those rules may not depart from Commission Delegated Regulation (EU) 2019/715 ( *35 ) unless the specific operational needs for the functioning of the Authority so require and only with the prior agreement of the Commission.
in Article 66, paragraph 1 is replaced by the following:
Article 70 is amended as follows:
paragraph 1 is replaced by the following:
in paragraph 2, the second subparagraph is replaced by the following:
‘The obligation under paragraph 1 of this Article and the first subparagraph of this paragraph shall not prevent the Authority and the competent authorities from using the information for the enforcement of the legislative acts referred to in Article 1(2), and in particular for legal procedures for the adoption of decisions.’;
the following paragraph is inserted:
The same requirements for professional secrecy shall also apply to observers who attend the meetings of the Management Board, and the Board of Supervisors and who take part in the activities of the Authority.’;
paragraphs 3 and 4 are replaced by the following:
That information shall be subject to the conditions of professional secrecy referred to in paragraphs 1 and 2. The Authority shall lay down in its internal rules of procedure the practical arrangements for implementing the confidentiality rules referred to in paragraphs 1 and 2.
Article 71 is replaced by the following:
‘Article 71
Data protection
This Regulation shall be without prejudice to the obligations of Member States relating to their processing of personal data under Regulation (EU) 2016/679 or the obligations of the Authority relating to its processing of personal data under Regulation (EU) 2018/1725 of the European Parliament and of the Council ( *38 ) when fulfilling its responsibilities.
in Article 72, paragraph 2 is replaced by the following:
in Article 74, the first paragraph is replaced by the following:
‘The necessary arrangements concerning the accommodation to be provided for the Authority in the Member State where its seat is located and the facilities to be made available by that Member State, as well as the specific rules applicable in that Member State to the staff of the Authority and members of their families, shall be laid down in a Headquarters Agreement between the Authority and that Member State which they concluded after obtaining the approval of the Management Board.’;
Article 76 is replaced by the following:
‘Article 76
Relationship with the Committee of European Insurance and Occupational Pensions Supervisors
The Authority shall be considered the legal successor of the Committee of European Insurance and Occupational Pensions Supervisors (CEIOPS). By the date of establishment of the Authority, all assets and liabilities and all pending operations of CEIOPS shall be automatically transferred to the Authority. CEIOPS shall establish a statement showing its closing asset and liability situation as of the date of that transfer. That statement shall be audited and approved by CEIOPS and by the Commission.’;
Article 81 is amended as follows:
paragraph 1 is amended as follows:
the introductory sentence is replaced by the following:
in point (a), the introductory sentence, and point (i) are replaced by the following:
the effectiveness and convergence in supervisory practices reached by competent authorities:
the independence of the competent authorities and convergence in standards equivalent to corporate governance;’;
the following point is added:
the functioning of the Joint Committee.’;
the following paragraph is inserted:
Article 3
Amendments to Regulation (EU) No 1095/2010
Regulation (EU) No 1095/2010 is amended as follows:
Article 1 is amended as follows:
paragraphs 2 and 3 are replaced by the following:
The Authority shall contribute to the work of the European Supervisory Authority (European Banking Authority) established by Regulation (EU) No 1093/2010 of the European Parliament and of the Council ( *42 ) related to the prevention of the use of the financial system for the purpose of money laundering or terrorist financing in accordance with Directive (EU) 2015/849 of the European Parliament and of the Council ( *43 ) and Regulation (EU) No 1093/2010. The Authority shall decide on its agreement in accordance with Article 9a(9) of Regulation (EU) No 1093/2010.
the following paragraph is inserted:
paragraph 5 is amended as follows:
the first subparagraph is amended as follows:
ensuring that the taking of investment and other risks are appropriately regulated and supervised;
enhancing customer and investor protection;’;
enhancing supervisory convergence across the internal market.’;
the second subparagraph is replaced by the following:
‘For those purposes, the Authority shall contribute to ensuring the consistent, efficient and effective application of the acts referred to in paragraph 2 of this Article, foster supervisory convergence, and provide opinions in accordance with Article 16a to the European Parliament, to the Council, and to the Commission.’;
the fourth subparagraph is replaced by the following:
‘When carrying out its tasks, the Authority shall act independently, objectively and in a non-discriminatory and transparent manner, in the interests of the Union as a whole, and shall respect, wherever relevant, the principle of proportionality. The Authority shall be accountable and act with integrity and shall ensure that all stakeholders are treated fairly.’;
the following subparagraph is added:
‘The content and form of the Authority’s actions and measures, in particular guidelines, recommendations, opinions, questions and answers, draft regulatory standards and draft implementing standards, shall fully respect the applicable provisions of this Regulation and of the legislative acts referred to in paragraph 2. To the extent permitted and relevant under those provisions, the Authority’s actions and measures shall, in accordance with the principle of proportionality, take due account of the nature, scale and complexity of the risks inherent in the business of a financial market participant, undertaking, other subject or financial activity, that is affected by the Authority’s actions and measures.’;
the following paragraph is added:
Article 2 is amended as follows:
paragraph 1 is replaced by the following:
paragraph 4 is replaced by the following:
in paragraph 5, the following subparagraph is added:
‘Without prejudice to national competences, references in this Regulation to supervision shall include all relevant activities of all competent authorities to be carried out pursuant to the legislative acts referred to in Article 1(2).’;
Article 3 is replaced by the following:
‘Article 3
Accountability of the Authorities
in Article 4, point (3), point (ii) is replaced by the following:
with regard to Directive 2002/65/EC, the authorities and bodies competent for ensuring compliance with the requirements of that Directive by firms providing investment services and by collective investment undertakings marketing their units or shares;’;
in Article 7, the following paragraph is added:
‘The location of the seat of the Authority shall not affect the Authority’s execution of its tasks and powers, the organisation of its governance structure, the operation of its main organisation, or the main financing of its activities, while allowing, where applicable, for the sharing with Union agencies of administrative support services and facility management services which are not related to the core activities of the Authority.’;
Article 8 is amended as follows:
paragraph 1 is amended as follows:
point (a) is replaced by the following:
based on the legislative acts referred to in Article 1(2), to contribute to the establishment of high-quality common regulatory and supervisory standards and practices, in particular by developing draft regulatory and implementing technical standards, guidelines, recommendations, and other measures, including opinions;’;
the following point is inserted:
to develop and maintain an up-to-date Union supervisory handbook on the supervision of financial market participants in the Union which is to set out best practices and high-quality methodologies and processes and takes into account, inter alia, changing business practices and business models and the size of financial market participants and of markets;’;
point (b) is replaced by the following:
to contribute to the consistent application of legally binding Union acts, in particular by contributing to a common supervisory culture, ensuring consistent, efficient and effective application of the legislative acts referred to in Article 1(2), preventing regulatory arbitrage, fostering and monitoring supervisory independence, mediating and settling disagreements between competent authorities, ensuring effective and consistent supervision of financial market participants, ensuring a coherent functioning of colleges of supervisors and taking actions, inter alia, in emergency situations;’;
points (e) to (h) are replaced by the following:
to organise and conduct peer reviews of competent authorities and, in that context, to issue guidelines and recommendations and to identify best practices, with a view to strengthening consistency in supervisory outcomes;
to monitor and assess market developments in the area of its competence including where relevant, developments relating to trends in innovative financial services duly considering developments relating to environmental, social and governance related factors;
to undertake market analyses to inform the discharge of the Authority’s functions;
to foster, where relevant, consumer and investor protection, in particular with regards to shortcomings in a cross-border context and taking related risks into account;’;
the following point is inserted:
to contribute to the establishment of a common Union financial data strategy;’;
the following point is inserted:
to publish on its website, and to update regularly, all regulatory technical standards, implementing technical standards, guidelines, recommendations and questions and answers for each legislative act referred to in Article 1(2), including overviews that concern the state of play of ongoing work and the planned timing of the adoption of draft regulatory technical standards and draft implementing technical standards.’;
point (l) is deleted;
the following paragraph is inserted:
When carrying out its tasks in accordance with this Regulation, the Authority shall:
use the full powers available to it;
with due regard to the objective to ensure the safety and soundness of financial market participants, take fully into account the different types, business models and sizes of financial market participants; and
take account of technological innovation, innovative and sustainable business models, and the integration of environmental, social and governance related factors.’;
paragraph 2 is amended as follows:
the following points are inserted:
issue recommendations, as laid down in Article 29a;’,
issue warnings in accordance with Article 9(3);’;
point (g) is replaced by the following:
issue opinions to the European Parliament, to the Council, or to the Commission as provided for in Article 16a;’;
the following points are inserted:
issue answers to questions, as laid down in Article 16b;
take action in accordance with Article 9a;’;
the following paragraph is added:
The open public consultations referred to in Articles 10, 15, 16 and 16a shall be conducted as widely as possible to ensure an inclusive approach towards all interested parties and shall allow reasonable time for stakeholders to respond. The Authority shall publish a summary of the input received from stakeholders and an overview of how information and views gathered from the consultations were used in a draft regulatory technical standard and a draft implementing technical standard.’;
Article 9 is amended as follows:
paragraph 1 is amended as follows:
point (a) is replaced by the following:
collecting, analysing and reporting on consumer trends, such as the development of costs and charges of retail financial services and products in Member States;’;
the following points are inserted:
undertaking in-depth thematic reviews of market conduct, building a common understanding of markets practices in order to identify potential problems and analyse their impact;
developing retail risk indicators for the timely identification of potential causes of consumer and investor harm;’;
the following points are added:
contributing to a level playing field in the internal market where consumers and other users of financial services have fair access to financial services and products;
coordinating mystery shopping activities of competent authorities, if applicable.’;
paragraph 2 is replaced by the following
paragraphs 4 and 5 are replaced by the following:
The Authority shall review the decision referred to in the first subparagraph at appropriate intervals and at least every six months. Following at least two consecutive renewals, and based on proper analysis which aims to assess the impact on the customer or consumer, the Authority may decide on the annual renewal of the prohibition.
A Member State may request the Authority to reconsider its decision. In that case, the Authority shall decide, in accordance with the procedure set out in the second subparagraph of Article 44(1), whether to maintain that decision.
The Authority may also assess the need to prohibit or restrict certain types of financial activity or practice and, where there is such a need, inform the Commission and the competent authorities in order to facilitate the adoption of any such prohibition or restriction.
the following article is inserted:
‘Article 9a
No action letters
The Authority shall take the measures referred to in paragraph 2 of this Article only in exceptional circumstances when it considers that the application of one of the legislative acts referred to in Article 1(2), or of any delegated or implementing acts based on those legislative acts, is liable to raise significant issues, for one of the following reasons:
the Authority considers that provisions contained in such act may directly conflict with another relevant act;
where the act is one of the legislative acts referred to in Article 1(2), the absence of delegated or implementing acts that would complement or specify the act in question would raise legitimate doubts concerning the legal consequences flowing from the legislative act or its proper application;
the absence of guidelines and recommendations as referred to in Article 16 would raise practical difficulties concerning the application of the relevant legislative act.
In the cases referred to in points (a) and (b) of paragraph 1, the Authority shall provide the Commission with an opinion on any action it considers appropriate, in the form of a new legislative proposal or a proposal for a new delegated or implementing act, and on the urgency that, in the Authority’s judgment, is attached to the issue. The Authority shall make its opinion public.
In the case referred to in point (c) of paragraph 1 of this Article, the Authority shall evaluate as soon as possible the need to adopt relevant guidelines or recommendations in accordance with Article 16.
The Authority shall act expeditiously, in particular with a view to contributing to the prevention of the issues as referred to in paragraph 1, whenever possible.
Article 10 is amended as follows:
paragraph 1 is amended as follows:
the first subparagraph is replaced by the following:
the third subparagraph is replaced by the following:
‘Before submitting them to the Commission, the Authority shall conduct open public consultations on draft regulatory technical standards and shall analyse the potential related costs and benefits, unless such consultations and analyses are highly disproportionate in relation to the scope and impact of the draft regulatory technical standards concerned or in relation to the particular urgency of the matter. The Authority shall also request the advice of the Securities and Markets Stakeholder Group referred to in Article 37.’;
the fourth subparagraph is deleted;
the fifth and the sixth subparagraphs are replaced by the following:
‘Within three months of receipt of a draft regulatory technical standard, the Commission shall decide whether to adopt it. The Commission shall inform the European Parliament and the Council, in due time, where the adoption cannot take place within the three-month period. The Commission may adopt the draft regulatory technical standard in part only, or with amendments, where the Union’s interests so require.
Where the Commission intends not to adopt a draft regulatory technical standard or to adopt it in part or with amendments, it shall send the draft regulatory technical standard back to the Authority, explaining why it does not adopt it, or explaining the reasons for its amendments. The Commission shall send a copy of its letter to the European Parliament and to the Council. Within a period of six weeks, the Authority may amend the draft regulatory technical standard on the basis of the Commission’s proposed amendments and resubmit it in the form of a formal opinion to the Commission. The Authority shall send a copy of its formal opinion to the European Parliament and to the Council.’;
paragraph 2 is replaced by the following:
in paragraph 3, the second subparagraph is replaced by the following:
‘The Commission shall conduct open public consultations on draft regulatory technical standards and analyse the potential related costs and benefits, unless such consultations and analyses are disproportionate in relation to the scope and impact of the draft regulatory technical standards concerned or in relation to the particular urgency of the matter. The Commission shall also request the advice of the Securities and Markets Stakeholder Group referred to in Article 37.’;
paragraph 4 is replaced by the following:
in Article 13(1), the second subparagraph is deleted;
Article 15 is amended as follows:
paragraphs 1 and 2 are replaced by the following:
Before submitting draft implementing technical standards to the Commission, the Authority shall conduct open public consultations and shall analyse the potential related costs and benefits, unless such consultations and analyses are highly disproportionate in relation to the scope and impact of the draft implementing technical standards concerned or in relation to the particular urgency of the matter. The Authority shall also request the advice of the Securities and Markets Stakeholder Group referred to in Article 37.
Within three months of receipt of a draft implementing technical standard, the Commission shall decide whether to adopt it. The Commission may extend that period by one month. The Commission shall inform the European Parliament and the Council in due time where the adoption cannot take place within the three-month period. The Commission may adopt the draft implementing technical standard in part only, or with amendments, where the Union’s interests so require.
Where the Commission intends not to adopt a draft implementing technical standard or intends to adopt it in part or with amendments, it shall send it back to the Authority explaining why it does not intend to adopt it or explaining the reasons for its amendments. The Commission shall send a copy of its letter to the European Parliament and to the Council. Within a period of six weeks, the Authority may amend the draft implementing technical standard on the basis of the Commission’s proposed amendments and resubmit it in the form of a formal opinion to the Commission. The Authority shall send a copy of its formal opinion to the European Parliament and to the Council.
If, on the expiry of the six-week period referred to in the fourth subparagraph, the Authority has not submitted an amended draft implementing technical standard, or has submitted a draft implementing technical standard that is not amended in a way consistent with the Commission’s proposed amendments, the Commission may adopt the implementing technical standard with the amendments it considers relevant or reject it.
The Commission shall not change the content of a draft implementing technical standard prepared by the Authority without prior coordination with the Authority, as set out in this Article.
in paragraph 3, the second subparagraph is replaced by the following:
‘The Commission shall conduct open public consultations on draft implementing technical standards and analyse the potential related costs and benefits, unless such consultations and analyses are disproportionate in relation to the scope and impact of the draft implementing technical standards concerned or in relation to the particular urgency of the matter. The Commission shall also request the advice of the Securities and Markets Stakeholder Group referred to in Article 37.’;
paragraph 4 is replaced by the following:
Article 16 is amended as follows:
paragraphs 1 and 2 are replaced by the following:
Guidelines and recommendations shall be in accordance with the empowerments conferred in the legislative acts referred to in Article 1(2) or in this Article.
the following paragraph is inserted:
paragraph 4 is replaced by the following:
the following articles are inserted:
‘Article 16a
Opinions
Article 16b
Questions and answers
Before submitting a question to the Authority, financial market participants shall consider whether to address the question in the first place to their competent authority.
Before publishing answers to admissible questions, the Authority may seek further clarification on questions asked by the natural or legal person referred to in this paragraph.
Article 17 is amended as follows:
paragraph 2 is amended as follows:
the first subparagraph is replaced by the following:
the following subparagraphs are added:
‘Without prejudice to the powers laid down in Article 35, the Authority may, after having informed the competent authority concerned, address a duly justified and reasoned request for information directly to other competent authorities whenever requesting information from the competent authority concerned has proven, or is deemed to be, insufficient to obtain the information that is deemed necessary for the purpose of investigating an alleged breach or non-application of Union law.
The addressee of such a request shall provide the Authority with clear, accurate and complete information without undue delay.’;
the following paragraph is inserted:
paragraphs 6 and 7 are replaced by the following:
The decision of the Authority shall be in conformity with the formal opinion issued by the Commission pursuant to paragraph 4.
When taking action in relation to issues which are subject to a formal opinion pursuant to paragraph 4 or to a decision pursuant to paragraph 6, competent authorities shall comply with the formal opinion or the decision, as the case may be.’;
the following article is inserted:
‘Article 17a
Protection of reporting persons
in Article 18, paragraph 3 is replaced by the following:
Article 19 is amended as follows:
paragraph 1 is replaced by the following:
In cases specified in the legislative acts referred to in Article 1(2) and without prejudice to the powers laid down in Article 17, the Authority may assist the competent authorities in reaching an agreement in accordance with the procedure set out in paragraphs 2 to 4 of this Article in either of the following circumstances:
at the request of one or more of the competent authorities concerned where a competent authority disagrees with the procedure or content of an action, proposed action, or inactivity of another competent authority;
in cases where the legislative acts referred to in Article 1(2) provide that the Authority may assist, on its own initiative, where on the basis of objective reasons, disagreement can be determined between competent authorities.
In cases where the legislative acts referred to in Article 1(2) require a joint decision to be taken by competent authorities and, where, in accordance with those acts, the Authority may assist, on its own initiative, in reaching an agreement in accordance with the procedure set out in paragraphs 2 to 4 of this Article, the competent authorities concerned, a disagreement shall be presumed in the absence of a joint decision being taken by those authorities within the time limits set out in those acts.’;
the following paragraphs are inserted:
The competent authorities concerned shall, in the following cases, notify the Authority without undue delay that an agreement has not been reached:
where a time limit for reaching an agreement between competent authorities has been provided for in the legislative acts referred to in Article 1(2), and either of the following occurs:
the time limit has expired; or
at least two competent authorities concerned conclude that a disagreement exists, on the basis of objective reasons;
where no time limit for reaching an agreement between competent authorities has been provided for in the legislative acts referred to in Article 1(2), and either of the following occurs:
at least two competent authorities concerned conclude that a disagreement exists on the basis of objective reasons; or
two months have elapsed from the date of receipt by a competent authority of a request from another competent authority to take certain action in order to comply with those acts and the requested authority has not yet adopted a decision that satisfies the request.
Pending the Authority’s decision in accordance with the procedure set out in Article 44(4), in cases where the legislative acts referred to in Article 1(2) require a joint decision to be taken, all competent authorities involved in the joint decision shall defer their individual decisions. Where the Authority decides to act, all the competent authorities involved in the joint decision shall defer their decisions until the procedure set out in paragraphs 2 and 3 of this Article is concluded.’;
paragraph 3 is replaced by the following:
the following paragraph is inserted:
paragraph 4 is replaced by the following:
Article 21 is amended as follows:
paragraph 1 is replaced by the following:
paragraph 2 is amended as follows:
the first subparagraph is replaced by the following:
in the third subparagraph, point (b) is replaced by the following:
initiate and coordinate Union-wide stress tests in accordance with Article 32 to assess the resilience of financial market participants, in particular the systemic risk posed by financial market participants as referred to in Article 23, to adverse market developments, and evaluate the potential for systemic risk posed by key financial market participants to increase in situations of stress, ensuring that a consistent methodology is applied at national level to such tests and, where appropriate, address a recommendation to the competent authority to correct issues identified in the stress test, including a recommendation to conduct specific assessments; it may recommend competent authorities to carry out on-site inspections, and may participate in such on-site inspections, in order to ensure comparability and reliability of methods, practices and results of Union-wide assessments;’;
paragraph 3 is replaced by the following:
Article 22 is amended as follows:
the title is replaced by the following:
‘General provisions on systemic risk’;
paragraph 4 is replaced by the following:
Following an inquiry conducted pursuant to the first subparagraph, the Board of Supervisors may make appropriate recommendations for action to the competent authorities concerned.
For those purposes, the Authority may use the powers conferred on it under this Regulation, including Article 35.’;
in Article 23, paragraph 1 is replaced by the following:
in Article 27(2), the second subparagraph is deleted;
Article 29 is amended as follows:
paragraph 1 is amended as follows:
the following points are inserted:
establishing Union strategic supervisory priorities in accordance with Article 29a;
establishing coordination groups in accordance with Article 45b to promote supervisory convergence and identify best practices;’;
point (b) is replaced by the following:
promoting an effective bilateral and multilateral exchange of information between competent authorities, pertaining to all relevant issues, including cyber security and cyber-attacks, with full respect for the applicable confidentiality and data protection provisions provided for in the relevant Union legislative acts;’;
point (e) is replaced by the following:
establishing sectoral and cross-sectoral training programmes, including with respect to technological innovation, facilitating personnel exchanges and encouraging competent authorities to intensify the use of secondment schemes and other tools;’;
the following point is added:
putting in place a monitoring system to assess material environmental, social and governance-related risks, taking into account the Paris Agreement to the United Nations Framework Convention on Climate Change;’;
paragraph 2 is replaced by the following:
For the purpose of establishing a common supervisory culture, the Authority shall develop and maintain an up-to-date Union supervisory handbook on the supervision of financial markets participants in the Union, which duly takes into account the nature, scale and complexity of risks, business practices, business models and size of financial institutions and of markets, including changes due to technological innovation, of financial market participants and markets. The Union supervisory handbook shall set out best practices and shall specify high-quality methodologies and processes.
The Authority shall, where appropriate, conduct open public consultations regarding the opinions referred to in point (a) of paragraph 1, and tools and instruments referred to in this paragraph. It shall also, where appropriate, analyse the related potential costs and benefits. Such consultations and analyses shall be proportionate in relation to the scope, nature and impact of the opinions or tools and instruments. The Authority shall, where appropriate, also request advice from the Securities and Markets Stakeholder Group.’;
the following Article is inserted:
‘Article 29a
Union strategic supervisory priorities
Following a discussion in the Board of Supervisors and taking into account contributions received from competent authorities, existing work by the Union institutions, and analysis, warnings and recommendations published by the ESRB, the Authority shall, at least every three years, by 31 March, identify up to two priorities of Union-wide relevance which shall reflect future developments and trends. Competent authorities shall take those priorities into account when drawing up their work programmes and shall notify the Authority accordingly. The Authority shall discuss the relevant activities by the competent authorities in the following year and draw conclusions. The Authority shall discuss possible follow up which may include guidelines, recommendations to competent authorities, and peer reviews, in the respective area.
The priorities of Union-wide relevance identified by the Authority shall not prevent competent authorities from applying their best practices, acting on their additional priorities and developments, and national specificities shall be considered.’;
Article 30 is replaced by the following:
‘Article 30
Peer reviews of competent authorities
The peer review shall include an assessment of, but shall not be limited to:
the adequacy of resources, the degree of independence, and governance arrangements of the competent authority, with particular regard to the effective application of the legislative acts referred to in Article 1(2) and the capacity to respond to market developments;
the effectiveness and the degree of convergence reached in the application of Union law and in supervisory practice, including regulatory technical standards and implementing technical standards, guidelines and recommendations adopted pursuant to Articles 10 to 16, and the extent to which the supervisory practice achieves the objectives set out in Union law;
the application of best practices developed by competent authorities whose adoption might be of benefit for other competent authorities;
the effectiveness and the degree of convergence reached with regard to the enforcement of the provisions adopted in the implementation of Union law, including the administrative sanctions and other administrative measures imposed against persons responsible where those provisions have not been complied with.
In accordance with Article 16(3), the competent authorities shall make every effort to comply with any guidelines and recommendations issued.
When developing draft regulatory technical standards or draft implementing technical standards in accordance with Articles 10 to 15, or guidelines or recommendations in accordance with Article 16, the Authority shall take into account the outcome of the peer review, along with any other information acquired by the Authority in carrying out its tasks, in order to ensure convergence of the highest quality supervisory practices.
Article 31 is amended as follows:
the first paragraph is replaced by the following:
the second paragraph is amended as follows:
the introductory part is replaced by the following:
point (e) is replaced by the following:
taking appropriate measures in the event of developments which may jeopardise the functioning of the financial markets with a view to the coordination of actions undertaken by relevant competent authorities;’;
the following point is inserted:
taking appropriate measures to coordinate actions undertaken by relevant competent authorities with a view to facilitating the entry into the market of actors or products relying on technological innovation;’;
the following paragraph is added:
the following Articles are inserted:
‘Article 31a
Information exchange on fitness and propriety
The Authority shall, together with the European Supervisory Authority (European Banking Authority) and with the European Supervisory Authority (European Insurance and Occupational Pensions Authority), establish a system for the exchange of information relevant to the assessment of the fitness and propriety of holders of qualifying holdings, directors and key function holders of financial market participant by competent authorities in accordance with the legislative acts referred to in Article 1(2).
Article 31b
Coordination function in relation to orders, transactions and activities with significant cross-border effects
Where a competent authority has evidence or clear indications from several different sources to suspect that orders, transactions or any other activity with significant cross-border effects threaten the orderly functioning and integrity of financial markets or the financial stability in the Union, it shall promptly notify the Authority and provide the relevant information. The Authority may issue an opinion on appropriate follow-up to the competent authorities of the Member States where the suspected activity has occurred.’;
Article 32 is amended as follows:
the title is replaced by the following:
‘Assessment of market developments, including stress tests’;
paragraph 1 is replaced by the following:
paragraph 2 is amended as follows:
the introductory part is replaced by the following:
point (a) is replaced by the following:
common methodologies for assessing the effect of economic scenarios on the financial position of a financial market participant, taking into account inter alia risks stemming from adverse environmental developments;’;
the following point is inserted:
common methodologies for identifying financial market participants to be included in Union-wide assessments;’;
the following point is added:
common methodologies for assessing the effect of environmental risks on the financial stability of financial market participants.’;
the following subparagraph is added:
‘For the purposes of this paragraph, the Authority shall cooperate with the ESRB.’;
in paragraph 3, the first subparagraph is replaced by the following:
Article 33 is replaced by the following:
‘Article 33
International relations including equivalence
Where a third country, in accordance with a delegated act, which is in force, adopted by the Commission pursuant to Article 9 of Directive (EU) 2015/849, is on the list of jurisdictions which have strategic deficiencies in their national anti-money laundering and countering the financing of terrorism regimes that pose significant threats to the financial system of the Union, the Authority shall not conclude administrative arrangements with the regulatory and supervisory authorities of that third country. This shall not preclude other forms of cooperation between the Authority and the respective third-country authorities with a view to reduce threats to the financial system of the Union.
Furthermore, it shall verify whether the criteria, on the basis of which those equivalence decisions have been taken, and any conditions set out therein, are still fulfilled.
The Authority may liaise with relevant authorities in third countries. The Authority shall submit a confidential report to the European Parliament, to the Council, to the Commission and to the European Supervisory Authority (European Banking Authority) and to the European Supervisory Authority (European Insurance and Occupational Pensions Authority) summarising the findings of its monitoring of all equivalent third countries. The report shall focus in particular on implications for financial stability, market integrity, investor protection or the functioning of the internal market.
Where the Authority identifies relevant developments in relation to the regulation and supervision or the enforcement practices in the third countries referred to in this paragraph that may affect the financial stability of the Union or of one or more of its Member States, market integrity, investor protection or the functioning of the internal market, it shall inform the European Parliament, the Council and the Commission on a confidential basis and without undue delay.
Without prejudice to specific requirements set out in the legislative acts referred to in Article 1(2) and subject to the conditions set out in the second sentence of paragraph 1 of this Article, the Authority shall cooperate where possible with the relevant competent authorities, of third countries whose regulatory and supervisory regimes have been recognised as equivalent. In principle, that cooperation shall be pursued on the basis of administrative arrangements concluded with the relevant authorities of those third countries. When negotiating such administrative arrangements, the Authority shall include provisions on the following:
the mechanisms which allow the Authority to obtain relevant information, including information on the regulatory regime, the supervisory approach, relevant market developments and any changes that may affect the equivalence decision;
to the extent necessary for the follow-up of such equivalence decisions, the procedures concerning the coordination of supervisory activities including, where necessary, on-site inspections
The Authority shall inform the Commission where a third-country competent authority refuses to conclude such administrative arrangements or when it refuses to effectively cooperate.
In the report referred to in Article 43(5), the Authority shall include information on the administrative arrangements agreed upon with supervisory authorities, international organisations or administrations in third countries, the assistance provided by the Authority to the Commission in preparing equivalence decisions and the monitoring by the Authority in accordance with paragraph 3 of this Article.
Article 34 is deleted;
Article 36 is amended as follows:
paragraph 3 is deleted;
paragraphs 4 and 5 are replaced by the following:
It shall decide, by the relevant decision-making procedure, on any actions to be taken in accordance with the powers conferred upon it by this Regulation for addressing the issues identified in the warnings and recommendations.
If the Authority does not act on a warning or recommendation, it shall explain to the ESRB its reasons for not doing so. The ESRB shall inform the European Parliament thereof in accordance with Article 19(5) of Regulation (EU) No 1092/2010. The ESRB shall also inform the Council thereof.
Where the addressee intends not to follow the recommendation of the ESRB, it shall inform and discuss with the Board of Supervisors its reasons for not acting.
Where the competent authority, in accordance with Article 17(1) of Regulation (EU) No 1092/2010, informs the European Parliament, the Council, the Commission and the ESRB of the actions it has undertaken in response to a recommendation of the ESRB, it shall take due account of the views of the Board of Supervisors.’;
paragraph 6 is deleted;
Article 37 is amended as follows:
paragraphs 2 and 3 are replaced by the following:
The Securities and Markets Stakeholder Group shall be composed of 30 members. Those members shall comprise of:
13 members representing, in balanced proportions, financial market participants operating in the Union;
13 members representing employees’ representatives of financial market participants operating in the Union, consumers, users of financial services and representatives of SMEs; and
four members who are independent top-ranking academics.
the following paragraph is inserted:
The European Parliament may invite the Chair of the Securities and Markets Stakeholder Group to make a statement before it and answer any questions from its members whenever so requested.’;
in paragraph 4, the first subparagraph is replaced by the following:
paragraph 5 is replaced by the following:
Where members of the Securities and Markets Stakeholder Group cannot agree on advice, one third of its members or the members representing one group of stakeholders shall be permitted to issue separate advice.
The Securities and Markets Stakeholder Group, the Banking Stakeholder Group, the Insurance and Reinsurance Stakeholder Group, and the Occupational Pensions Stakeholder Group may issue a joint advice on issues related to the work of the ESAs under Article 56 on joint positions and common acts.’;
paragraph 7 is replaced by the following:
Article 39 is replaced by the following:
‘Article 39
Decision-making procedures
Article 40 is amended as follows
in paragraph 1, point (a) is replaced by the following:
the Chairperson;’;
the following paragraph is added:
Articles 41 and 42 are replaced by the following:
‘Article 41
Internal committees
Each member of the panel shall have one vote.
Decisions of the panel shall be taken where at least four members vote in favour.
Each member of the panel shall have one vote.
Decisions of the panel shall be taken where at least four members vote in favour.
Each member of the panel shall have one vote.
Decisions of the panel shall be taken where at least four members vote in favour.
Article 42
Independence of the Board of Supervisors
Article 43 is amended as follows:
paragraph 1 is replaced by the following:
paragraphs 2 and 3 are deleted;
paragraph 5 is replaced by the following
paragraph 8 is replaced by the following:
the following article is inserted:
‘Article 43a
Transparency of decisions adopted by the Board of Supervisors
Notwithstanding Article 70, within six weeks of each meeting of the Board of Supervisors, the Authority shall, at least, provide the European Parliament with a comprehensive and meaningful record of the proceedings of that meeting that enables a full understanding of the discussions, including an annotated list of decisions. Such record shall not reflect discussions within the Board of Supervisors relating to individual financial market participants, unless otherwise provided for in Article 75(3) or in the legislative acts referred to in Article 1(2).’;
Article 44 is amended as follows:
paragraph 1 is replaced by the following:
With regard to the acts specified in Articles 10 to 16 of this Regulation and measures and decisions adopted under the third subparagraph of Article 9(5) of this Regulation, and Chapter VI of this Regulation and, by way of derogation from the first subparagraph of this paragraph, the Board of Supervisors shall take decisions on the basis of a qualified majority of its members, as defined in Article 16(4) TEU and in Article 3 of the Protocol No 36 on transitional provisions
The Chairperson shall not vote on the decisions referred to in the second subparagraph.
With regard to the composition of the panels in accordance with Article 41(2), (3) and (4), and the members of the peer review committee referred to in Article 30(2), the Board of Supervisors, when considering the proposals by the Chairperson, shall strive for consensus. In the absence of consensus, decisions of the Board of Supervisors shall be taken by a majority of three quarters of its voting members. Each voting member shall have one vote.
With regard to decisions adopted under Article 18(3) and (4), and by way of derogation from the first subparagraph of this paragraph, the Board of Supervisors shall take decisions on the basis of a simple majority of its voting members.’;
paragraph 4 is replaced by the following:
The non-voting members and the observers, with the exception of the Executive Director, shall not attend any discussions within the Board of Supervisors relating to individual financial market participants, unless otherwise provided for in Article 75(3) or in the legislative acts referred to in Article 1(2).’;
the following paragraph is added:
Article 45 is replaced by the following:
‘Article 45
Composition
Other than the Chairperson, each member of the Management Board shall have an alternate, who may replace him or her if he or she is prevented from attending.
the following articles are inserted:
‘Article 45a
Decision-making
Article 45b
Coordination Groups
Article 46 is replaced by the following:
‘Article 46
Independence of the Management Board
The members of the Management Board shall act independently and objectively in the sole interest of the Union as a whole and shall neither seek nor take instructions from the Union institutions or bodies, from any government or from any other public or private body.
Member States, Union institutions or bodies and any other public or private body shall not seek to influence the members of the Management Board in the performance of their tasks.’;
Article 47 is amended as follows:
the following paragraph is inserted:
paragraph 6 is replaced by the following:
paragraph 8 is replaced by the following:
the following paragraph is added:
Article 48 is amended as follows:
in paragraph 1, the second subparagraph is replaced by the following:
‘The Chairperson shall be responsible for preparing the work of the Board of Supervisors, including setting the agenda to be adopted by the Board of Supervisors, convening the meetings and tabling items for decision, and shall chair the meetings of the Board of Supervisors.
The Chairperson shall be responsible for setting the agenda of the Management Board, to be adopted by the Management Board, and shall chair the meetings of the Management Board.
The Chairperson may invite the Management Board to consider setting up a coordination group in accordance with Article 45b.’;
paragraph 2 is replaced by the following:
Where the Chairperson no longer fulfils the conditions referred to in Article 49 or has been found guilty of serious misconduct, the Council may, acting on a proposal from the Commission which has been approved by the European Parliament, adopt a decision to remove him or her from office.
The Board of Supervisors shall also elect, from among its members, a Vice-Chairperson who shall carry out the functions of the Chairperson in the absence of the Chairperson. That Vice-Chairperson shall not be elected from among the members of the Management Board.’;
in paragraph 4, the second subparagraph is replaced by the following:
‘For the purpose of the evaluation referred to in the first subparagraph, the tasks of the Chairperson shall be carried out by the Vice-Chairperson.
The Council, acting on a proposal from the Board of Supervisors and with the assistance of the Commission, and taking into account the evaluation referred to in the first subparagraph, may extend the term of office of the Chairperson once.’;
paragraph 5 is replaced by the following:
Article 49 is amended as follows:
the title is replaced by the following:
‘Independence of the Chairperson’;
the first paragraph is replaced by the following:
‘Without prejudice to the role of the Board of Supervisors in relation to the tasks of the Chairperson, the Chairperson shall neither seek nor take instructions from the Union institutions or bodies, from any government or from any other public or private body.’;
the following article is inserted:
‘Article 49a
Expenses
The Chairperson shall make public all meetings held with external stakeholders within a period of two weeks following the meeting and any hospitality received. Expenses shall be recorded publicly in accordance with the Staff Regulations.’;
Article 50 is deleted;
Article 54 is amended as follows:
paragraph 2 is amended as follows:
the introductory part is replaced by the following:
the first indent is replaced by the following:
financial conglomerates and, where required by Union law, prudential consolidation,’;
the fifth indent is replaced by the following:
cybersecurity,’;
the sixth indent is replaced by the following:
information and best practice exchange with the ESRB and the other ESAs,’;
the following indents are added:
retail financial services and consumer and investor protection issues;
the following paragraph is inserted:
paragraph 3 is replaced by the following:
Article 55 is amended as follows:
paragraph 3 is replaced by the following:
in paragraph 4, the second subparagraph is replaced by the following:
‘The Joint Committee shall meet at least once every three months.’;
the following paragraph is added:
Articles 56 and 57 are replaced by the following:
‘Article 56
Joint positions and common acts
Within the scope of its tasks set out in Chapter II of this Regulation, and, in particular with respect to the implementation of Directive 2002/87/EC, where relevant, the Authority shall reach joint positions by consensus with, as appropriate, the European Supervisory Authority (European Insurance and Occupational Pensions Authority) and with the European Supervisory Authority (European Banking Authority).
Where required by Union law, measures pursuant to Articles 10 to 16, and decisions pursuant to Articles 17, 18 and 19, of this Regulation in relation to the application of Directive 2002/87/EC and of any other legislative acts referred to in Article 1(2) of this Regulation that also fall within the area of competence of the European Supervisory Authority (European Banking Authority) or the European Supervisory Authority (European Insurance and Occupational Pensions Authority) shall be adopted, in parallel, by, as appropriate, the Authority, the European Supervisory Authority (European Banking Authority) and the European Supervisory Authority (European Insurance and Occupational Pensions Authority),.
Article 57
Sub-Committees
Article 58 is amended as follows:
paragraph 1 is replaced by the following:
in paragraph 2, the first subparagraph is replaced by the following:
paragraph 3 is replaced by the following:
After having received the shortlist, the European Parliament may invite candidates for members and alternates to make a statement before it and answer any questions from its Members.
The European Parliament may invite the members of the Board of Appeal to make a statement before it and answer any questions from its Members whenever so requested, to the exclusion of statements, questions or answers pertaining to individual cases decided by, or pending before, the Board of Appeal.’;
in Article 59, paragraph 2 is replaced by the following:
in Article 60, paragraph 2 is replaced by the following:
The Board of Appeal shall decide upon the appeal within three months after the appeal has been lodged.’;
the following article is inserted:
‘Article 60a
Exceeding of competence by the Authority
Any natural or legal person may send reasoned advice to the Commission if that person is of the opinion that the Authority has exceeded its competence, including by failing to respect the principle of proportionality referred to in Article 1(5), when acting under Articles 16 and 16b, and that is of direct and individual concern to that person.’;
in Article 62, paragraph 1 is amended as follows:
the introductory part is replaced by the following:
the following points are added:
any voluntary contribution from Member States or observers;
agreed charges for publications, training and for any other services provided by the Authority where they have been specifically requested by one or more competent authorities.’;
the following sub-paragraph is added:
‘Any voluntary contribution from Member States or observers referred to in point d of the first sub-paragraph shall not be accepted if such acceptance would cast doubt on the independence and impartiality of the Authority. Voluntary contributions that constitute compensation for the cost of tasks delegated by a competent authority to the Authority shall not be considered to cast doubt on the independence of the latter.’;
Articles 63, 64 and 65 are replaced by the following:
‘Article 63
Establishment of the budget
Article 64
Implementation and control of the budget
The Authority’s accounting officer shall also send, by 15 June each year, a reporting package to the Commission’s accounting officer, in a standardised format as laid down by the Commission’s accounting officer for consolidation purposes.
Article 65
Financial rules
The financial rules applicable to the Authority shall be adopted by the Management Board after consulting the Commission. Those rules may not depart from Commission Delegated Regulation (EU) 2019/715 ( *48 ) unless the specific operational needs for the functioning of the Authority so require and only with the prior agreement of the Commission.
in Article 66, paragraph 1 is replaced by the following:
Article 70 is amended as follows:
paragraph 1 is replaced by the following:
in paragraph 2, the second subparagraph is replaced by the following:
‘The obligation under paragraph 1 of this Article and the first subparagraph of this paragraph shall not prevent the Authority and the competent authorities from using the information for the enforcement of the legislative acts referred to in Article 1(2), and in particular for legal procedures for the adoption of decisions.’;
the following paragraph is inserted:
The same requirements for professional secrecy shall also apply to observers who attend the meetings of the Management Board, and the Board of Supervisors and who take part in the activities of the Authority.’;
paragraphs 3 and 4 are replaced by the following:
That information shall be subject to the conditions of professional secrecy referred to in paragraphs 1 and 2. The Authority shall lay down in its internal rules of procedure the practical arrangements for implementing the confidentiality rules referred to in paragraphs 1 and 2.
Article 71 is replaced by the following:
‘Article 71
Data protection
This Regulation shall be without prejudice to the obligations of Member States relating to their processing of personal data under Regulation (EU) 2016/679 or the obligations of the Authority relating to its processing of personal data under Regulation (EU) 2018/1725 of the European Parliament and of the Council ( *51 ) when fulfilling its responsibilities.
in Article 72, paragraph 2 is replaced by the following:
in Article 74, the first paragraph is replaced by the following:
‘The necessary arrangements concerning the accommodation to be provided for the Authority in the Member State where its seat is located and the facilities to be made available by that Member State, as well as the specific rules applicable in that Member State to the staff of the Authority and members of their families, shall be laid down in a Headquarters Agreement between the Authority and that Member State which they concluded after obtaining the approval of the Management Board.’;
Article 76 is replaced by the following:
‘Article 76
Relationship with the Committee of European Securities Regulators
The Authority shall be considered the legal successor of the Committee of European Securities Regulators (CESR). By the date of establishment of the Authority, all assets and liabilities and all pending operations of CESR shall be automatically transferred to the Authority. CESR shall establish a statement showing its closing asset and liability situation as of the date of that transfer. That statement shall be audited and approved by CESR and by the Commission.’;
Article 81 is amended as follows:
paragraph 1 is amended as follows:
the introductory sentence is replaced by the following:
in point (a), the introductory sentence, and point (i)are replaced by the following:
the effectiveness and convergence in supervisory practices reached by competent authorities:
the independence of the competent authorities and convergence in standards equivalent to corporate governance;’;
the following point is added:
the functioning of the Joint Committee.’;
the following paragraphs are inserted:
Article 4
Amendments to Regulation (EU) No 600/2014
Regulation (EU) No 600/2014 is amended as follows:
in Article 1(1), the following point is added:
the authorisation and supervision of data reporting services providers.’;
Article 2 is amended as follows:
paragraph 1 is amended as follows:
point (18) is replaced by the following:
“competent authority” means a competent authority as defined in point (26) of Article 4(1) of Directive 2014/65/EU and, for the authorisation and supervision of data reporting services providers, ESMA, with the exception of those approved reporting mechanisms (ARMs) and approved publication arrangements (APAs) with a derogation in accordance with paragraph 3 of this Article;’;
the following point is inserted:
“senior management” means senior management as defined in point (37) of Article 4(1) of Directive 2014/65/EU;’;
points (34), (35) and (36) are replaced by the following:
“approved publication arrangement” or “APA” means a person authorised under this Regulation to provide the service of publishing trade reports on behalf of investment firms pursuant to Articles 20 and 21;
“consolidated tape provider” or “CTP” means a person authorised under this Regulation to provide the service of collecting trade reports for financial instruments listed in Articles 6, 7, 10, 12 and 13, 20 and 21 from regulated markets, MTFs, OTFs and APAs and consolidating them into a continuous electronic live data stream providing price and volume data per financial instrument;
“approved reporting mechanism” or “ARM” means a person authorised under this Regulation to provide the service of reporting details of transactions to competent authorities or to ESMA on behalf of investment firms;’;
the following point is inserted:
“data reporting services provider” means a person referred to in points (34) to (36) and a person referred to in Article 27b(2);’;
the following paragraph is added:
When adopting the delegated act, the Commission shall take into account one or more of the following elements:
the extent to which the services are provided to investment firms authorised in one Member State only;
the number of trade reports or transactions;
whether the ARM or APA is part of a group of financial market participants operating cross border.
Where an entity is supervised by ESMA for any services provided in its capacity as a data reporting services provider under this Regulation, none of its activities as an ARM or APA shall be excluded from ESMA supervision under any delegated act adopted pursuant to this paragraph.’;
Article 22 is replaced by the following:
‘Article 22
Providing information for the purposes of transparency and other calculations
In order to carry out calculations for determining the requirements for the pre- and post-trade transparency and the trading obligation regimes referred to in Articles 3 to 11, Articles 14 to 21 and Article 32, which are applicable to financial instruments and for determining whether an investment firm is a systematic internaliser, ESMA and competent authorities may require information from:
trading venues;
APAs; and
CTPs.
Power is delegated to the Commission to supplement this Regulation by adopting the regulatory technical standards referred to in the first subparagraph in accordance with Articles 10 to 14 of Regulation (EU) No 1095/2010.’;
in Article 26(1), the third subparagraph is replaced by the following:
‘The competent authorities shall without undue delay make available to ESMA any information reported in accordance with this Article.’;
Article 27 is replaced by the following:
‘Article 27
Obligation to supply financial instrument reference data
With regard to other financial instruments covered by Article 26(2) traded on its system, each systematic internaliser shall provide ESMA with reference data relating to those financial instruments.
Identifying reference data shall be made ready for submission to ESMA in an electronic and standardised format before trading commences in the financial instrument that it refers to. The financial instrument reference data shall be updated whenever there are changes to the data with respect to a financial instrument. ESMA shall publish those reference data immediately on its website. ESMA shall give competent authorities access without undue delay to those reference data.
In order to allow competent authorities to monitor, pursuant to Article 26, the activities of investment firms to ensure that they act honestly, fairly and professionally and in a manner which promotes the integrity of the market, ESMA shall, after consulting the competent authorities, establish the necessary arrangements in order to ensure that:
ESMA effectively receives the financial instrument reference data pursuant to paragraph 1 of this Article;
the quality of the financial instrument reference data received pursuant to paragraph 1 of this Article is appropriate for the purpose of transaction reporting under Article 26;
the financial instrument reference data received pursuant to paragraph 1 of this Article is efficiently and without undue delay transmitted to the relevant competent authorities;
there are effective mechanisms in place between ESMA and the competent authorities to resolve data delivery or data quality issues.
ESMA shall develop draft regulatory technical standards to specify:
data standards and formats for the financial instrument reference data in accordance with paragraph 1, including the methods and arrangements for supplying the data and any update thereto to ESMA and transmitting it to competent authorities in accordance with paragraph 1, and the form and content of such data;
the technical measures that are necessary in relation to the arrangements to be made by ESMA and the competent authorities pursuant to paragraph 2.
Power is delegated to the Commission to supplement this Regulation by adopting the regulatory technical standards referred to in the first subparagraph in accordance with Articles 10 to 14 of Regulation (EU) No 1095/2010.
ESMA may suspend the reporting obligations specified in paragraph 1 for certain or all financial instruments where all of the following conditions are met:
the suspension is necessary in order to preserve the integrity and quality of the reference data subject to reporting obligation as specified in paragraph 1 which may be put at risk by any of the following:
serious incompleteness, inaccuracy or corruption of the submitted data, or
unavailability in a timely manner, disruption or damage of the functioning of systems used for the submitting, collecting, processing or storing the respective reference data by ESMA, national competent authorities, market infrastructures, clearing and settlement systems, and important market participants;
the existing Union regulatory requirements that are applicable do not address the threat;
the suspension does not have any detrimental effect on the efficiency of financial markets or investors that is disproportionate to the benefits of the action;
the suspension does not create any regulatory arbitrage.
When taking the measure referred to in the first subparagraph of this paragraph, ESMA shall take into account the extent to which the measure ensures the accuracy and completeness of the reported data for the purposes specified in paragraph 2.
Before deciding to take the measure referred to in the first subparagraph, ESMA shall notify the relevant competent authorities.
The Commission is empowered to adopt delegated acts in accordance with Article 50 in order to supplement this Regulation by specifying the conditions referred to in the first subparagraph and the circumstances under which the suspension referred to in that subparagraph ceases to apply.’;
the following Title is inserted:
‘TITLE IVa
DATA REPORTING SERVICES
CHAPTER 1
Authorisation of data reporting services providers
Article 27a
For the purposes of this Title, a national competent authority means a competent authority as defined in point (26) of Article 4(1) of Directive 2014/65/EU.
Article 27b
Requirement for authorisation
By way of derogation from the first subparagraph of this paragraph, an APA or ARM identified in accordance with the delegated act referred to in Article 2(3) shall be subject to prior authorisation and supervision by the relevant national competent authority in accordance with this Title.
Where ESMA, or a national competent authority where relevant, has withdrawn an authorisation in accordance with Article 27e, that withdrawal shall be published in the register for a period of five years.
Article 27c
Authorisation of data reporting services providers
Data reporting services providers shall be authorised by ESMA, or the national competent authority where relevant, for the purposes of this Title where:
the data reporting services provider is a legal person established in the Union; and
the data reporting services provider meets the requirements laid down in this Title.
Article 27d
Procedures for granting and refusing applications for authorisation
Where the application is not complete, ESMA, or the national competent authority where relevant, shall set a deadline by which the data reporting services provider is to provide additional information.
After assessing an application as complete, ESMA, or the national competent authority where relevant, shall notify the data reporting services provider accordingly.
ESMA shall develop draft regulatory technical standards to determine:
the information to be provided under paragraph 1, including the programme of operations;
the information included in the notifications under Article 27f(2).
Power is delegated to the Commission to supplement this Regulation by adopting the regulatory technical standards referred to in the first subparagraph in accordance with Articles 10 to 14 of Regulation (EU) No 1095/2010.
Power is conferred on the Commission to adopt the implementing technical standards referred to in the first subparagraph in accordance with Article 15 of Regulation (EU) No 1095/2010.
Article 27e
Withdrawal of authorisation
ESMA, or the national competent authority where relevant, may withdraw the authorisation of a data reporting services provider where the latter:
does not make use of the authorisation within 12 months, expressly renounces the authorisation or has provided no services for the preceding six months;
obtained the authorisation by making false statements or by any other irregular means;
no longer meets the conditions under which it was authorised;
has seriously and systematically infringed this Regulation.
Article 27f
Requirements for the management body of a data reporting services provider
The management body shall possess adequate collective knowledge, skills and experience to be able to understand the activities of the data reporting services provider. Each member of the management body shall act with honesty, integrity and independence of mind to effectively challenge the decisions of the senior management where necessary and to effectively oversee and monitor management decision-making where necessary.
Where a market operator seeks authorisation to operate an APA, a CTP or an ARM pursuant to Article 27d and the members of the management body of the APA, the CTP or the ARM are the same as the members of the management body of the regulated market, those persons are deemed to comply with the requirements laid down in the first subparagraph.
Power is delegated to the Commission to supplement this Regulation by adopting the regulatory technical standards referred to in the first subparagraph in accordance with Articles 10 to 14 of Regulation (EU) No 1095/2010.
CHAPTER 2
Conditions for APAs, CTPs and ARMs
Article 27g
Organisational requirements for APAs
The information made public by an APA in accordance with paragraph 1 shall include, at least, the following details:
the identifier of the financial instrument;
the price at which the transaction was concluded;
the volume of the transaction;
the time of the transaction;
the time the transaction was reported;
the price notation of the transaction;
the code for the trading venue the transaction was executed on, or where the transaction was executed via a systematic internaliser the code “SI” or otherwise the code “OTC”;
if applicable, an indicator that the transaction was subject to specific conditions.
Power is delegated to the Commission to supplement this Regulation by adopting the regulatory technical standards referred to in the first subparagraph in accordance with Articles 10 to 14 of Regulation (EU) No 1095/2010.
ESMA shall develop draft regulatory technical standards specifying:
the means by which an APA may comply with the information obligation referred to in paragraph 1;
the content of the information published under paragraph 1, including at least the information referred to in paragraph 2 in such a way as to enable the publication of information required under this Article;
the concrete organisational requirements laid down in paragraphs 3, 4 and 5.
Power is delegated to the Commission to supplement this Regulation by adopting the regulatory technical standards referred to in the first subparagraph in accordance with Articles 10 to 14 of Regulation (EU) No 1095/2010.
Article 27h
Organisational requirements for CTPs
That information shall include, at least, the following details:
the identifier of the financial instrument;
the price at which the transaction was concluded;
the volume of the transaction;
the time of the transaction;
the time the transaction was reported;
the price notation of the transaction;
the code for the trading venue the transaction was executed on, or where the transaction was executed via a systematic internaliser the code “SI” or otherwise the code “OTC”;
where applicable, the fact that a computer algorithm within the investment firm was responsible for the investment decision and the execution of the transaction;
if applicable, an indicator that the transaction was subject to specific conditions;
if the obligation to make public the information referred to in Article 3(1) was waived in accordance with point (a) or (b) of Article 4(1), a flag to indicate which of those waivers the transaction was subject to.
The information shall be made available free of charge 15 minutes after the CTP has published it. The CTP shall be able to efficiently and consistently disseminate such information in a way that ensures fast access to the information, on a non-discriminatory basis and in formats that are easily accessible and utilisable for market participants.
A CTP shall have adequate policies and arrangements in place to collect the information made public in accordance with Article 10 and Article 21, consolidate it into a continuous electronic data stream, and make information available to the public as close to real time as is technically possible, on a reasonable commercial basis including, at least, the following details:
the identifier or identifying features of the financial instrument;
the price at which the transaction was concluded;
the volume of the transaction;
the time of the transaction;
the time the transaction was reported;
the price notation of the transaction;
the code for the trading venue the transaction was executed on, or where the transaction was executed via a systematic internaliser the code “SI” or otherwise the code “OTC”;
if applicable, an indicator that the transaction was subject to specific conditions.
The information shall be made available free of charge 15 minutes after the CTP has published it. The CTP shall be able to efficiently and consistently disseminate such information in a way that ensures fast access to the information, on a non-discriminatory basis, and in generally accepted formats that are interoperable and easily accessible and utilisable for market participants.
Power is delegated to the Commission to supplement this Regulation by adopting the regulatory technical standards referred to in the first subparagraph in accordance with Articles 10 to 14 of Regulation (EU) No 1095/2010.
ESMA shall develop draft regulatory technical standards specifying:
the means by which the CTP may comply with the information obligation referred to in paragraphs 1 and 2;
the content of the information published under paragraphs 1 and 2;
the financial instruments data of which must be provided in the data stream and for non-equity instruments the trading venues and APAs which need to be included;
other means to ensure that the data published by different CTPs is consistent and allows for comprehensive mapping and cross-referencing against similar data from other sources, and is capable of being aggregated at Union level;
the concrete organisational requirements laid down in paragraphs 4 and 5.
Power is delegated to the Commission to supplement this Regulation by adopting the regulatory technical standards referred to in the first subparagraph in accordance with Articles 10 to 14 of Regulation (EU) No 1095/2010.
Article 27i
Organisational requirements for ARMs
The ARM shall have systems in place to enable the ARM to detect errors or omissions caused by the ARM itself and to enable the ARM to correct and transmit, or re-transmit as the case may be, correct and complete transaction reports to the competent authority.
ESMA shall develop draft regulatory technical standards specifying:
the means by which the ARM may comply with the information obligation referred to in paragraph 1; and
the concrete organisational requirements laid down in paragraphs 2, 3 and 4.
Power is delegated to the Commission to supplement this Regulation by adopting the regulatory technical standards referred to in the first subparagraph in accordance with Articles 10 to 14 of Regulation (EU) No 1095/2010.’;
the following Title is inserted:
‘TITLE VIa
ESMA POWERS AND COMPETENCES
CHAPTER 1
Competences and procedures
Article 38a
Exercise of ESMA’s powers
The powers conferred on ESMA or any official of or other person authorised by ESMA by Articles 38b to 38e shall not be used to require the disclosure of information or documents which are subject to legal privilege.
Article 38b
Request for information
ESMA may by simple request or by decision require the following persons to provide all information to enable ESMA to carry out its duties under this Regulation:
an APA, a CTP, an ARM, where they are supervised by ESMA, and an investment firm or a market operator operating a trading venue to operate the data reporting services of an APA, a CTP or an ARM, and the persons that control them or are controlled by them;
the managers of the persons referred to in point (a);
the auditors and advisors of the persons referred to in point (a);
Any simple request for information referred to in paragraph 1 shall:
refer to this Article as the legal basis of that request;
state the purpose of the request;
specify the information required;
include a time limit within which the information is to be provided;
include a statement that there is no obligation on the person from whom the information is requested to provide that information but that in the event of a voluntary reply to the request, the information provided must not be incorrect or misleading;
indicate the amount of the fine to be imposed in accordance with Article 38h where the information provided is incorrect or misleading.
When requiring to supply information under paragraph 1 by decision, ESMA shall:
refer to this Article as the legal basis of that request;
state the purpose of the request;
specify the information required;
set a time limit within which the information is to be provided;
indicate the periodic penalty payments provided for in Article 38i where the production of the required information is incomplete;
indicate the fine provided for in Article 38h, where the answers to questions asked are incorrect or misleading;
indicate the right to appeal the decision before ESMA’s Board of Appeal and to have the decision reviewed by the Court of Justice of the European Union (Court of Justice) in accordance with Articles 60 and 61 of Regulation (EU) No 1095/2010.
Article 38c
General investigations
In order to carry out its duties under this Regulation, ESMA may conduct necessary investigations of persons referred to in Article 38b(1). To that end, the officials and other persons authorised by ESMA shall be empowered to:
examine any records, data, procedures and any other material relevant to the execution of its tasks irrespective of the medium on which they are stored;
take or obtain certified copies of or extracts from such records, data, procedures and other material;
summon and ask any person referred to in Article 38b(1) or their representatives or staff for oral or written explanations on facts or documents relating to the subject matter and purpose of the inspection and to record the answers;
interview any other natural or legal person who consents to be interviewed for the purpose of collecting information relating to the subject matter of an investigation;
request records of telephone and data traffic.
Where a national judicial authority receives an application for the authorisation of a request for records of telephone or data traffic referred to in point (e) of paragraph 1, that authority shall verify the following:
the decision adopted by ESMA referred to in paragraph 3 is authentic;
any measures to be taken are proportionate and not arbitrary or excessive.
For the purposes of point (b), the national judicial authority may ask ESMA for detailed explanations, in particular relating to the grounds ESMA has for suspecting that an infringement of this Regulation has taken place and the seriousness of the suspected infringement and the nature of the involvement of the person subject to the coercive measures. However, the national judicial authority shall not review the necessity for the investigation or demand that it be provided with the information on ESMA’s file. The lawfulness of ESMA’s decision shall be subject to review only by the Court of Justice following the procedure set out in Regulation (EU) No 1095/2010.
Article 38d
On-site inspections
Where a national judicial authority receives an application for the authorisation of an on-site inspection provided for in paragraph 1 or the assistance provided for in paragraph 7, that authority shall verify the following:
the decision adopted by ESMA referred to in paragraph 5 is authentic;
any measures to be taken are proportionate and not arbitrary or excessive.
For the purposes of point (b), the national judicial authority may ask ESMA for detailed explanations, in particular relating to the grounds ESMA has for suspecting that an infringement of this Regulation has taken place and the seriousness of the suspected infringement and the nature of the involvement of the person subject to the coercive measures. However, the national judicial authority shall not review the necessity for the investigation or demand that it be provided with the information on ESMA’s file. The lawfulness of ESMA’s decision shall be subject to review only by the Court of Justice following the procedure set out in Regulation (EU) No 1095/2010.
Article 38e
Exchange of information
ESMA and the competent authorities shall, without undue delay, provide each other with the information required for the purposes of carrying out their duties under this Regulation.
Article 38f
Professional secrecy
The obligation of professional secrecy referred to in Article 76 of Directive 2014/65/EU shall apply to ESMA and all persons who work or who have worked for ESMA or for any other person to whom ESMA has delegated tasks, including auditors and experts contracted by ESMA.
Article 38g
Supervisory measures by ESMA
Where ESMA finds that a person listed in point (a) of Article 38b(1) has committed one of the infringements of requirements provided for in Title IVa, it shall take one or more of the following actions:
adopt a decision requiring the person to bring the infringement to an end;
adopt a decision imposing fines or periodic penalty payments pursuant to Articles 38h and 38i;
issue public notices.
When taking the actions referred to in paragraph 1, ESMA shall take into account the nature and seriousness of the infringement, having regard to the following criteria:
the duration and frequency of the infringement;
whether financial crime has been occasioned, facilitated or otherwise attributable to the infringement;
whether the infringement has been committed intentionally or negligently;
the degree of responsibility of the person responsible for the infringement;
the financial strength of the person responsible for the infringement, as indicated by the total turnover of the responsible legal person or the annual income and net assets of the responsible natural person;
the impact of the infringement on investors’ interests;
the importance of the profits gained, losses avoided by the person responsible for the infringement or the losses for third parties derived from the infringement, insofar as they can be determined;
the level of cooperation of the person responsible for the infringement with ESMA, without prejudice to the need to ensure disgorgement of profits gained or losses avoided by that person;
previous infringements by the person responsible for the infringement;
measures taken after the infringement by the person responsible for the infringement to prevent its repetition.
The disclosure to the public referred to in the first subparagraph shall include the following:
a statement affirming the right of the person responsible for the infringement to appeal the decision;
where relevant, a statement affirming that an appeal has been lodged and specifying that such an appeal does not have suspensive effect;
a statement asserting that it is possible for ESMA’s Board of Appeal to suspend the application of the contested decision in accordance with Article 60(3) of Regulation (EU) No 1095/2010.
CHAPTER 2
Administrative sanctions and other administrative measures
Article 38h
Fines
An infringement shall be considered to have been committed intentionally if ESMA finds objective factors which demonstrate that a person acted deliberately to commit the infringement.
Article 38i
Periodic penalty payments
ESMA shall, by decision, impose periodic penalty payments in order to compel:
a person to put an end to an infringement in accordance with a decision taken pursuant to point (a) of Article 38g(1);
a person referred to in Article 38b(1):
to supply complete information which has been requested by a decision pursuant to Article 38b;
to submit to an investigation and in particular to produce complete records, data, procedures or any other material required and to complete and correct other information provided in an investigation launched by a decision pursuant to Article 38c;
to submit to an on-site inspection ordered by a decision taken pursuant to Article 38d.
Article 38j
Disclosure, nature, enforcement and allocation of fines and periodic penalty payments
Enforcement shall be governed by the rules of procedure in force in the Member State in the territory of which it is carried out.
Article 38k
Procedural rules for taking supervisory measures and imposing fines
Article 38l
Hearing of the persons concerned
The first subparagraph shall not apply if urgent action is needed in order to prevent significant and imminent damage to the financial system. In such a case ESMA may adopt an interim decision and shall give the persons concerned the opportunity to be heard as soon as possible after taking its decision.
Article 38m
Review by the Court of Justice
The Court of Justice shall have unlimited jurisdiction to review decisions whereby ESMA has imposed a fine or a periodic penalty payment. It may annul, reduce or increase the fine or periodic penalty payment imposed.
Article 38n
Authorisation and supervisory fees
Article 38o
Delegation of tasks by ESMA to competent authorities
Prior to delegation of a task, ESMA shall consult the relevant competent authority about:
the scope of the task to be delegated;
the timetable for the performance of the task; and
the transmission of necessary information by and to ESMA.
in Article 40, paragraph 6 is replaced by the following:
in Article 41, paragraph 6 is replaced by the following:
Article 50 is amended as follows:
paragraph 2 is replaced by the following:
in paragraph 3, the first sentence is replaced by the following:
‘The delegation of power referred to in Article 1(9), Article 2(2) and (3), Article 13(2), Article 15(5), Article 17(3), Article 19(2) and (3), Article 27(4), Article 27g(7), Article 27h(7), Article 31(4), Article 38k(10), Article 38n(3), Article 40(8), Article 41(8), Article 42(7), Article 45(10) and Article 52(10), (12) and (14) may be revoked at any time by the European Parliament or by the Council.’;
in paragraph 5, the first sentence is replaced by the following:
‘A delegated act adopted pursuant to Article 1(9), Article 2(2) and (3), Article 13(2), Article 15(5), Article 17(3), Article 19(2) and (3), Article 27(4), Article 27g(7), Article 27h(7), Article 31(4), Article 38k(10), Article 38n(3), Article 40(8), Article 41(8), Article 42(7), Article 45(10) and Article 52(10), (12) and (14) shall enter into force only if no objection has been expressed either by the European Parliament or by the Council within a period of three months of notification of that act to the European Parliament and to the Council or if, before the expiry of that period, the European Parliament and the Council have both informed the Commission that they will not object.’;
in Article 52, the following paragraphs are added:
The reports referred to in the first subparagraph shall assess the functioning of the consolidated tape against the following criteria:
the availability and timeliness of post trade information in a consolidated format capturing all transactions irrespective of whether they are carried out on trading venues or not;
the availability and timeliness of full and partial post trade information that is of a high quality, in formats that are easily accessible and usable for market participants and available on a reasonable commercial basis.
Where the Commission concludes that the CTPs have failed to provide information in a way that meets the criteria set out in the second subparagraph, the Commission shall attach a request to its report for ESMA to launch a negotiated procedure for the appointment though a public procurement process run by ESMA of a commercial entity operating a consolidated tape. ESMA shall launch the procedure after receiving the request from the Commission on the conditions specified in the Commission’s request and in accordance with Regulation (EU, Euratom) 2018/1046 of the European Parliament and of the Council ( *53 ).
Where the procedure outlined in paragraph 14 of this Article has been initiated, the Commission is empowered to adopt delegated acts in accordance with Article 50 in order to supplement this Regulation, by specifying measures in order to:
provide for the contract duration of the commercial entity operating a consolidated tape and the process and conditions for renewing the contract and the launching of new public procurement;
provide that the commercial entity operating a consolidated tape shall do so on an exclusive basis and that no other entity shall be authorised as a CTP in accordance with Article 27b;
empower ESMA to ensure adherence with tender conditions by the commercial entity operating a consolidated tape appointed through a public procurement;
ensure that the post-trade information provided by the commercial entity operating a consolidated tape is of a high quality, in formats that are easily accessible and usable for market participants and in a consolidated format capturing the entire market;
ensure that the post trade information is provided on a reasonable commercial basis, on both a consolidated and unconsolidated basis, and meets the needs of the users of that information across the Union;
ensure that trading venues and APAs shall make their trade data available to the commercial entity operating a consolidated tape appointed through a public procurement process run by ESMA at a reasonable cost;
specify arrangements applicable where the commercial entity operating a consolidated tape appointed through a public procurement fails to fulfil the tender conditions;
specify arrangements under which CTPs authorised under Article 27b may continue to operate a consolidated tape where the empowerment provided for in point (b) of this paragraph is not used or, where no entity is appointed through the public procurement, until such time as a new public procurement is completed and a commercial entity is appointed to operate a consolidated tape.
the following articles are inserted:
‘Article 54a
Transitional measures related to ESMA
However, an application for authorisation that has been received by competent authorities before 1 October 2021 shall not be transferred to ESMA, and the decision to register or refuse registration shall be taken by the relevant competent authority.
Article 54b
Relations with auditors
Any person authorised within the meaning of Directive 2006/43/EC of the European Parliament and of the Council ( *54 ), performing in a data reporting services provider the task described in Article 34 of Directive 2013/34/EU of the European Parliament and of the Council ( *55 ) or Article 73 of Directive 2009/65/EC or any other task prescribed by law, shall have a duty to report promptly to ESMA any fact or decision concerning that data reporting services provider of which that person has become aware while carrying out that task and which is liable to:
constitute a material infringement of the laws, regulations or administrative provisions which lay down the conditions governing authorisation or which specifically govern pursuit of the activities of data reporting services provider;
affect the continuous functioning of the data reporting services provider;
lead to refusal to certify the accounts or to the expression of reservations.
That person shall also have a duty to report any facts and decisions of which the person becomes aware in the course of carrying out one of the tasks referred to in the first subparagraph in an undertaking having close links with the data reporting services provider within which he or she is carrying out that task.
Article 5
Amendments to Regulation (EU) 2016/1011
Regulation (EU) 2016/1011 is amended as follows:
in Article 3(1), point (24)(a) is amended as follows:
the introductory part is replaced by the following:
input data contributed entirely from:’;
point (vii) is replaced by the following:
a service provider to which the benchmark administrator has outsourced the data collection in accordance with Article 10, with the exception of point (f) of Article 10(3), provided that the service provider receives the data entirely from an entity referred to in points (i) to (vi) of this point;’;
in Article 4, the following paragraph is added:
ESMA shall submit those draft regulatory technical standards to the Commission by 1 October 2020.
Power is delegated to the Commission to supplement this Regulation by adopting the regulatory technical standards referred to in the first subparagraph in accordance with Articles 10 to 14 of Regulation (EU) No 1095/2010.’;
in Article 12, the following paragraph is added:
ESMA shall submit those draft regulatory technical standards to the Commission by 1 October 2020.
Power is delegated to the Commission to supplement this Regulation by adopting the regulatory technical standards referred to in the first subparagraph in accordance with Articles 10 to 14 of Regulation (EU) No 1095/2010.’;
in Article 14, the following paragraph is added:
ESMA shall submit those draft regulatory technical standards to the Commission by 1 October 2020.
Power is delegated to the Commission to supplement this Regulation by adopting the regulatory technical standards referred to in the first subparagraph in accordance with Articles 10 to 14 of Regulation (EU) No 1095/2010.’;
in Article 20, the following paragraph is inserted:
After receiving that documented request, the Commission shall adopt an implementing act in accordance with paragraph 1.
ESMA shall review its assessment of the criticality of the benchmark at least every two years and shall notify and transmit the assessment to the Commission.’;
Article 21 is amended as follows:
paragraph 2 is replaced by the following:
Upon receipt of the assessment by the administrator referred to in paragraph 1, the competent authority shall:
inform ESMA and the college established under Article 46;
within four weeks following the receipt of that assessment, make its own assessment of how the benchmark is to be transitioned to a new administrator or be ceased to be provided, taking into account the procedure established in accordance with Article 28(1).
During the period referred to in point (b) of the first subparagraph, the administrator shall not cease the provision of the benchmark without the written consent of ESMA or the competent authority, where relevant.’;
paragraph 5 is added:
ESMA shall submit those draft regulatory technical standards to the Commission by 1 October 2020.
Power is delegated to the Commission to supplement this Regulation by adopting the regulatory technical standards referred to in the first subparagraph in accordance with Articles 10 to 14 of Regulation (EU) No 1095/2010.’;
in Article 23, paragraphs 3 and 4 are replaced by the following:
The competent authority of the critical benchmark administrator shall inform the competent authority of that supervised contributor, and where applicable ESMA, thereof without undue delay. The administrator shall submit to its competent authority an assessment of the implications on the capability of the critical benchmark to measure the underlying market or economic reality, as soon as possible but no later than 14 days after the notification made by the supervised contributor.
in Article 26, the following paragraph is added:
ESMA shall submit those draft regulatory technical standards to the Commission by 1 October 2020.
Power is delegated to the Commission to supplement this Regulation by adopting the regulatory technical standards referred to in the first subparagraph in accordance with Articles 10 to 14 of Regulation (EU) No 1095/2010.’;
Article 30 is amended as follows:
in paragraph 2, the following subparagraph is inserted after point (b):
‘The Commission may subject the application of the implementing decision referred to in the first subparagraph to the effective fulfilment by that third country of any condition, aiming at ensuring equivalent supervisory and regulatory standards, set out in that implementing decision on an ongoing basis and to the ability of ESMA to effectively exercise the monitoring responsibilities referred to in Article 33 of Regulation (EU) No 1095/2010.’;
the following paragraph 2a is inserted:
in paragraph 3, the following subparagraph is inserted after point (b):
‘The Commission may subject the application of the implementing decision referred to in the first subparagraph to the effective fulfilment by that third country of any condition, aiming at ensuring equivalent supervisory and regulatory standards, set out in that implementing decision on an ongoing basis and to the ability of ESMA to effectively exercise the monitoring responsibilities referred to in Article 33 of Regulation (EU) No 1095/2010.’;
the following paragraph is inserted:
the introductory part of paragraph 4 is replaced by the following:
Article 32 is amended as follows:
paragraph 1 is replaced by the following:
the second subparagraph of paragraph 2 is replaced by the following:
‘To determine whether the condition referred to in the first subparagraph is fulfilled and to assess compliance with the IOSCO principles for financial benchmarks or the IOSCO principles for PRAs, as applicable, ESMA may take into account an assessment by an independent external auditor or, a certification provided by the competent authority of the administrator in the third country where the administrator is located.’;
paragraph 3 is replaced by the following:
‘An administrator located in a third country intending to obtain prior recognition as referred to in paragraph 1 shall have a legal representative. The legal representative shall be a natural or legal person located in the Union and expressly appointed by that administrator to act on behalf of that administrator with regard to the administrator’s obligations under this Regulation. The legal representative shall, together with the administrator, perform the oversight function relating to the provision of benchmarks performed by the administrator under this Regulation and, in that respect, be accountable to ESMA.’;
paragraph 4 is deleted;
paragraph 5 is replaced by the following:
Within 90 working days of receipt of the application referred to in the first subparagraph of this paragraph, ESMA shall verify that the conditions laid down in paragraphs 2 and 3 are fulfilled.
Where ESMA considers that the conditions laid down in paragraphs 2 and 3 are not fulfilled, it shall refuse the recognition request and set out the reasons for that refusal. In addition, no recognition shall be granted unless the following additional conditions are fulfilled:
where an administrator located in a third country is subject to supervision, an appropriate cooperation arrangement is in place between ESMA and the competent authority of the third country where the administrator is located, in compliance with the regulatory technical standards adopted pursuant to Article 30(5), to ensure an efficient exchange of information that enables the competent authority of that third country to carry out its duties in accordance with this Regulation;
the effective exercise by ESMA of its supervisory functions under this Regulation is neither prevented by the laws, regulations or administrative provisions of the third country where the administrator is located, nor, where applicable, by limitations in the supervisory and investigatory powers of that third country’s competent authority.’;
paragraphs 6 and 7 are deleted;
paragraph 8 is replaced by the following:
ESMA shall suspend or, where appropriate, withdraw the recognition granted in accordance with paragraph 5 where it has well-founded reasons, based on documented evidence, to consider that the administrator:
is acting in a manner which is clearly prejudicial to the interests of users of its benchmarks or to the orderly functioning of markets;
has seriously infringed the relevant requirements set out in this Regulation;
made false statements or used any other irregular means to obtain the recognition.’;
in Article 34, the following paragraph is inserted:
Article 40 is replaced by the following:
‘Article 40
Competent authorities
For the purposes of this Regulation, ESMA shall be the competent authority for:
administrators of critical benchmarks as referred to in points (a) and (c) of Article 20(1);
administrators of the benchmarks referred to in Article 32.
Article 41 is amended as follows:
in paragraph 1, the introductory part is replaced by the following:
in paragraph 2, the introductory part is replaced by the following:
in Article 43(1), the introductory part is replaced by the following:
Article 44 is replaced by the following:
‘Article 44
Obligation to cooperate
in Article 45(5), the first subparagraph is replaced by the following:
in Article 46, paragraphs 1 and 2 are replaced by the following:
in Article 47, paragraphs 1 and 2 are replaced by the following:
in Title VI, the following Chapter is added:
‘CHAPTER 4
ESMA powers and competences
Article 48a
Exercise of the powers by ESMA
The powers conferred on ESMA, on any official of ESMA or on any other person authorised by ESMA by Articles 48b to 48d shall not be used to require the disclosure of information or documents that are subject to legal privilege.
Article 48b
Request for information
ESMA may by simple request or by decision require the following persons to provide all necessary information to enable ESMA to carry out its duties under this Regulation:
persons involved in the provision of benchmarks, as referred to in Article 40(1);
third parties to whom the persons referred to in point (a) have outsourced functions or activities in accordance with Article 10;
persons otherwise closely and substantially related or connected to the persons referred to in point (a).
In accordance with Article 35 of Regulation (EU) No 1095/2010 and at the request of ESMA, competent authorities shall submit that request for information to contributors to critical benchmarks referred to in points (a) and (c) of Article 20(1) of this Regulation and shall share the information received without undue delay with ESMA.
Any simple request for information as referred to paragraph 1 shall:
refer to this Article as the legal basis of that request;
state the purpose of that request;
specify what information is required;
include a time limit within which the information is to be provided;
include a statement that there is no obligation on the person from whom the information is requested to provide that information but that in the event of a voluntary reply to the request, the information provided must not be incorrect or misleading;
indicate the amount of the fine to be imposed in accordance with Article 48f where information provided is incorrect or misleading.
When requiring to supply information under paragraph 1 by decision, ESMA shall:
refer to this Article as the legal basis of that request;
state the purpose of that request;
specify what information is required;
set a time limit within which the information is to be provided;
indicate the periodic penalty payments provided for in Article 48g where the required information is incomplete;
indicate the fine provided for in Article 48f, where the answers to the questions asked are incorrect or misleading;
indicate the right to appeal the decision before ESMA’s Board of Appeal and to have the decision reviewed by the Court of Justice of the European Union (Court of Justice) in accordance with Article 48k of this Regulation and Articles 60 and 61 of Regulation (EU) No 1095/2010.
Article 48c
General investigations
In order to carry out its duties under this Regulation, ESMA may conduct necessary investigations of the persons referred to in Article 48b(1). To that end, the officials and other persons authorised by ESMA shall be empowered to:
examine any records, data, procedures and any other material relevant to the execution of its tasks, irrespective of the medium on which they are stored;
take or obtain certified copies of or extracts from such records, data, procedures and other material;
summon and ask any of those persons or their representatives, or staff, for oral or written explanations on facts or documents relating to the subject matter and purpose of the inspection, and to record the answers;
interview any other natural or legal person who consents to be interviewed for the purpose of collecting information relating to the subject matter of an investigation;
request records of telephone and data traffic.
Where a national judicial authority receives an application for the authorisation of a request for records of telephone or data traffic referred to in point (e) of paragraph 1 that authority shall verify the following:
the decision referred to in paragraph 3 is authentic;
any measures to be taken are proportionate and not arbitrary or excessive.
For the purposes of point (b), the national judicial authority may ask ESMA for detailed explanations, in particular relating to the grounds ESMA has for suspecting that an infringement of this Regulation has taken place and the seriousness of the suspected infringement and the nature of the involvement of the person subject to the coercive measures. However, the national judicial authority shall not review the necessity for the investigation or demand that it be provided with the information on ESMA’s file. The lawfulness of ESMA’s decision shall be subject to review only by the Court of Justice following the procedure set out in Article 61 of Regulation (EU) No 1095/2010.
Article 48d
On-site inspections
Where a national judicial authority receives an application for the authorisation of an on-site inspection provided for in paragraph 1 or the assistance provided for in paragraph 7, that authority shall verify the following:
the decision adopted by ESMA referred to in paragraph 5 is authentic;
any measures to be taken are proportionate and not arbitrary or excessive.
For the purposes of point (b), the national judicial authority may ask ESMA for detailed explanations, in particular relating to the grounds ESMA has for suspecting that an infringement of this Regulation has taken place and the seriousness of the suspected infringement and the nature of the involvement of the person subject to the coercive measures. However, the national judicial authority shall not review the necessity of the investigation or demand that it be provided with the information on ESMA’s file. The lawfulness of ESMA’s decision shall be subject to review only by the Court of Justice following the procedure set out in Article 61 Regulation (EU) No 1095/2010.
Article 48e
Supervisory measures by ESMA
Where, in accordance with Article 48i(5), ESMA finds that a person has committed one of the infringements listed in point (a) of Article 42(1), it shall take one or more of the following actions:
adopt a decision requiring the person to bring the infringement to an end;
adopt a decision imposing fines pursuant to Article 48f;
issue public notices.
When taking the actions referred to in paragraph 1, ESMA shall take into account the nature and seriousness of the infringement, having regard to the following criteria:
the duration and frequency of the infringement;
whether financial crime has been occasioned, facilitated or otherwise attributable to the infringement;
whether the infringement has been committed intentionally or negligently;
the degree of responsibility of the person responsible for the infringement;
the financial strength of the person responsible for the infringement, as indicated by the total turnover of the responsible legal person or the annual income and net assets of the responsible natural person;
the impact of the infringement on retail investors’ interests;
the importance of the profits gained, losses avoided by the person responsible for the infringement or the losses for third parties derived from the infringement, insofar as they can be determined;
the level of cooperation of the person responsible for the infringement with ESMA, without prejudice to the need to ensure disgorgement of profits gained or losses avoided by that person;
previous infringements by the person responsible for the infringement;
measures taken after the infringement by the person responsible for the infringement to prevent its repetition.
The disclosure to the public referred to in the first subparagraph shall include the following:
a statement affirming the right of the person responsible for the infringement to appeal the decision;
where relevant, a statement affirming that an appeal has been lodged and specifying that such an appeal does not have suspensive effect;
a statement asserting that it is possible for ESMA’s Board of Appeal to suspend the application of the contested decision in accordance with Article 60(3) of Regulation (EU) No 1095/2010.
Article 48f
Fines
An infringement shall be considered to have been committed intentionally if ESMA finds objective factors which demonstrate that a person acted deliberately to commit the infringement.
The maximum amount of the fine referred to in paragraph 1 shall be:
in the case of a legal person, EUR 1 000 000 , or, in the Member States whose currency is not the euro, the corresponding value in the national currency on 30 June 2016, or 10 % of the total annual turnover of that legal person according to the last available financial statements approved by the management body, whichever is the higher;
in the case of a natural person, EUR 500 000 , or, in the Member States whose currency is not the euro, the corresponding value in the national currency on 30 June 2016.
Notwithstanding the first subparagraph, the maximum amount of the fine for infringements of point (d) of Article 11(1) or of Article 11(4) shall be EUR 250 000 or, in the Member States whose official currency is not the euro, the corresponding value in the national currency on 30 June 2016 or 2 % of the total annual turnover of that legal person according to the last available financial statements approved by the management body, whichever is the higher for legal persons, and EUR 100 000 or, in the Member States whose official currency is not the euro, the corresponding value in the national currency on 30 June 2016 for natural persons.
For the purposes of point (a), where the legal person is a parent undertaking or a subsidiary of a parent undertaking which is required to prepare consolidated financial accounts in accordance with Directive 2013/34/EU, the relevant total annual turnover shall be the total annual turnover or the corresponding type of income in accordance with the relevant Union law in the area of accounting according to the last available consolidated accounts approved by the management body of the ultimate parent undertaking.
Article 48g
Periodic penalty payments
ESMA shall, by decision, impose periodic penalty payments to compel:
a person to put an end to an infringement in accordance with a decision taken pursuant to point (a) of Article 48e(1);
persons referred to in Article 48b(1):
to supply complete information which has been requested by a decision pursuant to Article 48b;
to submit to an investigation and in particular to produce complete records, data, procedures or any other material required and to complete and correct other information provided in an investigation launched by a decision pursuant to Article 48c;
to submit to an on-site inspection ordered by a decision taken pursuant to Article 48d.
Article 48h
Disclosure, nature, enforcement and allocation of fines and periodic penalty payments
Enforcement shall be governed by the rules of procedure in force in the Member State or third country in which it is carried out.
Article 48i
Procedural rules for taking supervisory measures and imposing fines
Article 48j
Hearing of the persons subject to investigations
The first subparagraph shall not apply if urgent action pursuant to Article 48e is needed in order to prevent significant and imminent damage to the financial system. In such a case ESMA may adopt an interim decision and shall give the persons concerned the opportunity to be heard as soon as possible after taking its decision.
Article 48k
Review by the Court of Justice
The Court of Justice shall have unlimited jurisdiction to review decisions whereby ESMA has imposed a fine or a periodic penalty payment. It may annul, reduce or increase the fine or periodic penalty payment imposed.
Article 48l
Supervisory fees
Article 48m
Delegation of tasks by ESMA to competent authorities
By way of derogation from the first subparagraph, the authorisation of critical benchmarks shall not be delegated.
Prior to the delegation of a task in accordance with paragraph 1, ESMA shall consult the relevant competent authority about:
the scope of the task to be delegated;
the timetable for the performance of the task; and
the transmission of necessary information by and to ESMA.
Article 48n
Transition measures related to ESMA
However, applications for authorisation by administrators of a critical benchmark referred to in points (a) and (c) of Article 20(1) and applications for recognition in accordance with Article 32 that have been received by competent authorities before 1 October 2021 shall not be transferred to ESMA, and the decision to authorise or recognise shall be taken by the relevant competent authority.
Article 49 is amended as follows:
the following paragraph is inserted:
paragraph 3 is replaced by the following:
paragraph 6 is replaced by the following:
Article 53 is replaced as follows:
‘Article 53
ESMA reviews
ESMA shall issue an opinion to each competent authority that has endorsed a third-country benchmark assessing how that competent authority applies the relevant requirements of Article 33 and the requirements of any relevant delegated act and regulatory or implementing technical standards based on this Regulation.
Article 6
Amendments to Regulation (EU) 2015/847
Regulation (EU) 2015/847 is amended as follows:
in Article 15, paragraph 1 is replaced by the following
in Article 17, paragraph 3 is replaced by the following:
in Article 22, paragraph 2 is replaced by the following:
Article 25 is replaced by the following:
‘Article 25
Guidelines
By 26 June 2017, the ESAs shall issue guidelines addressed to the competent authorities and the payment service providers in accordance with Article 16 of Regulation (EU) No 1093/2010 on measures to be taken in accordance with this Regulation, in particular as regards the implementation of Articles 7, 8, 11 and 12 thereof. From 1 January 2020, EBA shall, where appropriate, issue such guidelines.’.
Article 7
Entry into force and entry into application
This Regulation shall enter into force on the third day following that of its publication in the Official Journal of the European Union.
Articles 1, 2, 3 and 6 shall apply from 1 January 2020. Articles 4 and 5 shall apply from 1 January 2022.
This Regulation shall be binding in its entirety and directly applicable in the Member States in accordance with the Treaties.
( *1 ) Directive 2008/48/EC of the European Parliament and of the Council of 23 April 2008 on credit agreements for consumers and repealing Council Directive 87/102/EEC (OJ L 133, 22.5.2008, p. 66).
( *2 ) Regulation (EU) No 575/2013 of the European Parliament and of the Council of 26 June 2013 on prudential requirements for credit institutions and amending Regulation (EU) No 648/2012 (OJ L 176, 27.6.2013, p. 1).
( *3 ) Directive 2013/36/EU 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).
( *4 ) Directive 2014/49/EU of the European Parliament and of the Council of 16 April 2014 on deposit guarantee schemes (OJ L 173, 12.6.2014, p. 149).
( *5 ) Directive 2014/92/EU of the European Parliament and of the Council of 23 July 2014 on the comparability of fees related to payment accounts, payment account switching and access to payment accounts with basic features (OJ L 257, 28.8.2014, p. 214).
( *6 ) Directive (EU) 2015/2366 of the European Parliament and of the Council of 25 November 2015 on payment services in the internal market, amending Directives 2002/65/EC, 2009/110/EC and 2013/36/EU and Regulation (EU) No 1093/2010, and repealing Directive 2007/64/EC (OJ L 337, 23.12.2015, p. 35).
( *7 ) Council Regulation (EU) No 1024/2013 of 15 October 2013 conferring specific tasks on the European Central Bank concerning policies relating to the prudential supervision of credit institutions (OJ L 287, 29.10.2013, p. 63).
( *8 ) Directive (EU) 2015/849 of the European Parliament and of the Council of 20 May 2015 on the prevention of the use of the financial system for the purposes of money laundering or terrorist financing, amending Regulation (EU) No 648/2012 of the European Parliament and of the Council, and repealing Directive 2005/60/EC of the European Parliament and of the Council and Commission Directive 2006/70/EC (OJ L 141, 5.6.2015, p. 73).
( *9 ) Regulation (EU) 2015/847 of the European Parliament and of the Council of 20 May 2015 on information accompanying transfers of funds and repealing Regulation (EC) No 1781/2006 (OJ L 141, 5.6.2015, p. 1).
( *10 ) Regulation (EU) No 1094/2010 of the European Parliament and of the Council of 24 November 2010 establishing a European Supervisory Authority (European Insurance and Occupational Pensions Authority), amending Decision No 716/2009/EC and repealing Commission Decision 2009/79/EC (OJ L 331, 15.12.2010, p. 48).
( *11 ) Regulation (EU) No 1095/2010 of the European Parliament and of the Council of 24 November 2010 establishing a European Supervisory Authority (European Securities and Markets Authority), amending Decision No 716/2009/EC and repealing Commission Decision 2009/77/EC (OJ L 331, 15.12.2010, p. 84).’;
( *12 ) Directive 2014/59/EU of the European Parliament and of the Council of 15 May 2014 establishing a framework for the recovery and resolution of credit institutions and investment firms and amending Council Directive 82/891/EEC, and Directives 2001/24/EC, 2002/47/EC, 2004/25/EC, 2005/56/EC, 2007/36/EC, 2011/35/EU, 2012/30/EU and 2013/36/EU, and Regulations (EU) No 1093/2010 and (EU) No 648/2012, of the European Parliament and of the Council (OJ L 173, 12.6.2014, p. 190).
( *13 ) Regulation (EU) No 806/2014 of the European Parliament and of the Council of 15 July 2014 establishing uniform rules and a uniform procedure for the resolution of credit institutions and certain investment firms in the framework of a Single Resolution Mechanism and a Single Resolution Fund and amending Regulation (EU) No 1093/2010 (OJ L 225, 30.7.2014, p. 1).
( *14 ) Directive 2014/17/EU of the European Parliament and of the Council of 4 February 2014 on credit agreements for consumers relating to residential immovable property and amending Directives 2008/48/EC and 2013/36/EU and Regulation (EU) No 1093/2010 (OJ L 60, 28.2.2014, p. 34).
( *15 ) Regulation (EU) 2015/751 of the European Parliament and of the Council of 29 April 2015 on interchange fees for card-based payment transactions (OJ L 123, 19.5.2015, p. 1).
( *16 ) Directive 2009/110/EC of the European Parliament and of the Council of 16 September 2009 on the taking up, pursuit and prudential supervision of the business of electronic money institutions amending Directives 2005/60/EC and 2006/48/EC and repealing Directive 2000/46/EC (OJ L 267, 10.10.2009, p. 7).
( *17 ) Regulation (EU) No 260/2012 of the European Parliament and of the Council of 14 March 2012 establishing technical and business requirements for credit transfers and direct debits in euro and amending Regulation (EC) No 924/2009 (OJ L 94, 30.3.2012, p. 22).’;
( *18 ) Regulation (EU) 2016/679 of the European Parliament and of the Council of 27 April 2016 on the protection of natural persons with regard to the processing of personal data and on the free movement of such data, and repealing Directive 95/46/EC (General Data Protection Regulation) (OJ L 119, 4.5.2016, p. 1).’;
( *19 ) Council Regulation (EU) 2017/1939 of 12 October 2017 implementing enhanced cooperation on the establishment of the European Public Prosecutor’s Office (“the EPPO”) (OJ L 283, 31.10.2017, p. 1).’;
( *20 ) Directive (EU) 2019/1937 of the European Parliament and of the Council of 23 October 2019 on the protection of persons who report breaches of Union law (OJ L 305, 26.11.2019, p. 17).’;
( *21 ) OJ L 56, 4.3.1968, p. 1.’;
( *22 ) Regulation (EU, Euratom) 2018/1046 of the European Parliament and of the Council of 18 July 2018 on the financial rules applicable to the general budget of the Union, amending Regulations (EU) No 1296/2013, (EU) No 1301/2013, (EU) No 1303/2013, (EU) No 1304/2013, (EU) No 1309/2013, (EU) No 1316/2013, (EU) No 223/2014, (EU) No 283/2014, and Decision No 541/2014/EU and repealing Regulation (EU, Euratom) No 966/2012 (OJ L 193, 30.7.2018, p. 1).’;
( *23 ) Commission Delegated Regulation (EU) 2019/715 of 18 December 2018 on the framework financial regulation for the bodies set up under the TFEU and Euratom Treaty and referred to in Article 70 of Regulation (EU, Euratom) 2018/1046 of the European Parliament and of the Council (OJ L 122, 10.5.2019, p. 1).’;
( *24 ) Regulation (EU, Euratom) No 883/2013 of the European Parliament and of the Council of 11 September 2013 concerning investigations conducted by the European Anti-Fraud Office (OLAF) and repealing Regulation (EC) No 1073/1999 of the European Parliament and of the Council and Council Regulation (Euratom) No 1074/1999 (OJ L 248, 18.9.2013, p. 1).’;
( *25 ) Commission Decision (EU, Euratom) 2015/444 of 13 March 2015 on the security rules for protecting EU classified information (OJ L 72, 17.3.2015, p. 53).’;
( *26 ) Regulation (EU) 2018/1725 of the European Parliament and of the Council of 23 October 2018 on the protection of natural persons with regard to the processing of personal data by the Union institutions, bodies, offices and agencies and on the free movement of such data, and repealing Regulation (EC) No 45/2001 and Decision No 1247/2002/EC (OJ L 295, 21.11.2018, p. 39).’;
( *27 ) Directive (EU) 2016/97 of the European Parliament and of the Council of 20 January 2016 on insurance distribution (OJ L 26, 2.2.2016, p. 19).
( *28 ) Directive (EU) 2016/2341 of the European Parliament and of the Council of 14 December 2016 on the activities and supervision of institutions for occupational retirement provision (IORPs) (OJ L 354, 23.12.2016, p. 37).
( *29 ) Regulation (EU) No 1093/2010 of the European Parliament and of the Council of 24 November 2010 establishing a European Supervisory Authority (European Banking Authority), amending Decision No 716/2009/EC and repealing Commission Decision 2009/78/EC (OJ L 331, 15.12.2010, p. 12).
( *30 ) Directive (EU) 2015/849 of the European Parliament and of the Council of 20 May 2015 on the prevention of the use of the financial system for the purposes of money laundering or terrorist financing, amending Regulation (EU) No 648/2012 of the European Parliament and of the Council, and repealing Directive 2005/60/EC of the European Parliament and of the Council and Commission Directive 2006/70/EC (OJ L 141, 5.6.2015, p. 73).’;
( *31 ) Regulation (EU) 2016/679 of the European Parliament and of the Council of 27 April 2016 on the protection of natural persons with regard to the processing of personal data and on the free movement of such data, and repealing Directive 95/46/EC (General Data Protection Regulation) (OJ L 119, 4.5.2016, p. 1).’;
( *32 ) Directive (EU) 2019/1937 of the European Parliament and of the Council of 23 October 2019 on the protection of persons who report breaches of Union law (OJ L 305, 26.11.2019, p. 17).’;
( *33 ) OJ L 56, 4.3.1968, p. 1.’;
( *34 ) Regulation (EU, Euratom) 2018/1046 of the European Parliament and of the Council of 18 July 2018 on the financial rules applicable to the general budget of the Union, amending Regulations (EU) No 1296/2013, (EU) No 1301/2013, (EU) No 1303/2013, (EU) No 1304/2013, (EU) No 1309/2013, (EU) No 1316/2013, (EU) No 223/2014, (EU) No 283/2014, and Decision No 541/2014/EU and repealing Regulation (EU, Euratom) No 966/2012 (OJ L 193, 30.7.2018, p. 1).’;
( *35 ) Commission Delegated Regulation (EU) 2019/715 of 18 December 2018 on the framework financial regulation for the bodies set up under the TFEU and Euratom Treaty and referred to in Article 70 of Regulation (EU, Euratom) 2018/1046 of the European Parliament and of the Council (OJ L 122, 10.5.2019, p. 1).’;
( *36 ) Regulation (EU, Euratom) No 883/2013 of the European Parliament and of the Council of 11 September 2013 concerning investigations conducted by the European Anti-Fraud Office (OLAF) and repealing Regulation (EC) No 1073/1999 of the European Parliament and of the Council and Council Regulation (Euratom) No 1074/1999 (OJ L 248, 18.9.2013, p. 1).’;
( *37 ) Commission Decision (EU, Euratom) 2015/444 of 13 March 2015 on the security rules for protecting EU classified information (OJ L 72, 17.3.2015, p. 53).’;
( *38 ) Regulation (EU) 2018/1725 of the European Parliament and of the Council of 23 October 2018 on the protection of natural persons with regard to the processing of personal data by the Union institutions, bodies, offices and agencies and on the free movement of such data, and repealing Regulation (EC) No 45/2001 and Decision No 1247/2002/EC (OJ L 295, 21.11.2018, p. 39).’;
( *39 ) Directive 2011/61/EU of the European Parliament and of the Council of 8 June 2011 on Alternative Investment Fund Managers and amending Directives 2003/41/EC and 2009/65/EC and Regulations (EC) No 1060/2009 and (EU) No 1095/2010 (OJ L 174, 1.7.2011, p. 1).
( *40 ) Directive 2014/65/EU of the European Parliament and of the Council of 15 May 2014 on markets in financial instruments and amending Directive 2002/92/EC and Directive 2011/61/EU (OJ L 173, 12.6.2014, p. 349).
( *41 ) Regulation (EU) 2017/1129 of the European Parliament and of the Council of 14 June 2017 on the prospectus to be published when securities are offered to the public or admitted to trading on a regulated market, and repealing Directive 2003/71/EC (OJ L 168, 30.6.2017, p. 12).
( *42 ) Regulation (EU) No 1093/2010 of the European Parliament and of the Council of 24 November 2010 establishing a European Supervisory Authority (European Banking Authority), amending Decision No 716/2009/EC and repealing Commission Decision 2009/78/EC (OJ L 331, 15.12.2010, p. 12).
( *43 ) Directive (EU) 2015/849 of the European Parliament and of the Council of 20 May 2015 on the prevention of the use of the financial system for the purposes of money laundering or terrorist financing, amending Regulation (EU) No 648/2012 of the European Parliament and of the Council, and repealing Directive 2005/60/EC of the European Parliament and of the Council and Commission Directive 2006/70/EC (OJ L 141, 5.6.2015, p. 73).’;
( *44 ) Regulation (EU) 2016/679 of the European Parliament and of the Council of 27 April 2016 on the protection of natural persons with regard to the processing of personal data and on the free movement of such data, and repealing Directive 95/46/EC (General Data Protection Regulation) (OJ L 119, 4.5.2016, p. 1).’;
( *45 ) Directive (EU) 2019/1937 of the European Parliament and of the Council of 23 October 2019 on the protection of persons who report breaches of Union law (OJ L 305, 26.11.2019, p. 17).’;
( *46 ) OJ L 56, 4.3.1968, p. 1.’;
( *47 ) Regulation (EU, Euratom) 2018/1046 of the European Parliament and of the Council of 18 July 2018 on the financial rules applicable to the general budget of the Union, amending Regulations (EU) No 1296/2013, (EU) No 1301/2013, (EU) No 1303/2013, (EU) No 1304/2013, (EU) No 1309/2013, (EU) No 1316/2013, (EU) No 223/2014, (EU) No 283/2014, and Decision No 541/2014/EU and repealing Regulation (EU, Euratom) No 966/2012 (OJ L 193, 30.7.2018, p. 1).’;
( *48 ) Commission Delegated Regulation (EU) 2019/715 of 18 December 2018 on the framework financial regulation for the bodies set up under the TFEU and Euratom Treaty and referred to in Article 70 of Regulation (EU, Euratom) 2018/1046 of the European Parliament and of the Council (OJ L 122, 10.5.2019, p. 1).’;
( *49 ) Regulation (EU, Euratom) No 883/2013 of the European Parliament and of the Council of 11 September 2013 concerning investigations conducted by the European Anti-Fraud Office (OLAF) and repealing Regulation (EC) No 1073/1999 of the European Parliament and of the Council and Council Regulation (Euratom) No 1074/1999 (OJ L 248, 18.9.2013, p. 1).’;
( *50 ) Commission Decision (EU, Euratom) 2015/444 of 13 March 2015 on the security rules for protecting EU classified information (OJ L 72, 17.3.2015, p. 53).’;
( *51 ) Regulation (EU) 2018/1725 of the European Parliament and of the Council of 23 October 2018 on the protection of natural persons with regard to the processing of personal data by the Union institutions, bodies, offices and agencies and on the free movement of such data, and repealing Regulation (EC) No 45/2001 and Decision No 1247/2002/EC (OJ L 295, 21.11.2018, p. 39).’;
( *52 ) Regulation (EU) 2018/1725 of the European Parliament and of the Council of 23 October 2018 on the protection of natural persons with regard to the processing of personal data by the Union institutions, bodies, offices and agencies and on the free movement of such data, and repealing Regulation (EC) No 45/2001 and Decision No 1247/2002/EC (OJ L 295, 21.11.2018, p. 39).’;
( *53 ) Regulation (EU, Euratom) 2018/1046 of the European Parliament and of the Council of 18 July 2018 on the financial rules applicable to the general budget of the Union, amending Regulations (EU) No 1296/2013, (EU) No 1301/2013, (EU) No 1303/2013, (EU) No 1304/2013, (EU) No 1309/2013, (EU) No 1316/2013, (EU) No 223/2014, (EU) No 283/2014, and Decision No 541/2014/EU and repealing Regulation (EU, Euratom) No 966/2012 (OJ L 193, 30.7.2018, p. 1).’;
( *54 ) Directive 2006/43/EC of the European Parliament and of the Council of 17 May 2006 on statutory audits of annual accounts and consolidated accounts, amending Council Directives 78/660/EEC and 83/349/EEC and repealing Council Directive 84/253/EEC (OJ L 157, 9.6.2006, p. 87).
( *55 ) Directive 2013/34/EU of the European Parliament and of the Council of 26 June 2013 on the annual financial statements, consolidated financial statements and related reports of certain types of undertakings, amending Directive 2006/43/EC of the European Parliament and of the Council and repealing Council Directives 78/660/EEC and 83/349/EEC (OJ L 182, 29.6.2013, p. 19).’.
( *56 ) Directive (EU) 2015/849 of the European Parliament and of the Council of 20 May 2015 on the prevention of the use of the financial system for the purposes of money laundering or terrorist financing, amending Regulation (EU) No 648/2012 of the European Parliament and of the Council, and repealing Directive 2005/60/EC of the European Parliament and of the Council and Commission Directive 2006/70/EC (OJ L 141, 5.6.2015, p. 73).’;
( *57 ) Regulation (EU) 2018/1725 of the European Parliament and of the Council of 23 October 2018 on the protection of natural persons with regard to the processing of personal data by the Union institutions, bodies, offices and agencies and on the free movement of such data, and repealing Regulation (EC) No 45/2001 and Decision No 1247/2002/EC (OJ L 295, 21.11.2018, p. 39).’;
( *58 ) Regulation (EU) 2016/679 of the European Parliament and of the Council of 27 April 2016 on the protection of natural persons with regard to the processing of personal data and on the free movement of such data, and repealing Directive 95/46/EC (General Data Protection Regulation) (OJ L 119, 4.5.2016, p. 1).
( *59 ) Regulation (EU) 2018/1725 of the European Parliament and of the Council of 23 October 2018 on the protection of natural persons with regard to the processing of personal data by the Union institutions, bodies, offices and agencies and on the free movement of such data, and repealing Regulation (EC) No 45/2001 and Decision No 1247/2002/EC (OJ L 295, 21.11.2018, p. 39).’;