This document is an excerpt from the EUR-Lex website
Prudential requirements of investment firms
Prudential requirements of investment firms
Prudential requirements of investment firms
Regulation (EU) 2019/2033 on the prudential requirements of investment firms
Capital requirements set out in the IFR consist of:
‘Class 3’ firms are subject to lighter requirements than ‘class 2’ firms: while capital requirements for a ‘class 3’ firm are equal to whichever of its FOR and PMR is higher, capital requirements for a ‘class 2’ firm are equal to whichever of its FOR, PMR and overall K-factor requirement is higher.
Disclosure rules for investment firms require them to provide annual information on:
In amending Regulation (EU) No 600/2014 (the markets in financial instruments regulation – see summary), the IFR has also enhanced and reinforced the regulation’s ‘equivalence framework’, which provides rules for the provision of markets in financial instruments directive (MiFID) services in the European Union (EU) by firms based in non-EU countries for which the European Commission has adopted an ‘equivalence decision’, i.e. has assessed that those countries’ legally binding prudential, organisational and business conduct rules are equivalent to those in place in the EU.
The IFR also amends Regulations (EU) No 1093/2010 (see summary), (EU) No 575/2013 and (EU) No 806/2014 (see summary).
The Commission has powers to adopt delegated acts in the form of regulatory and implementing technical standards developed by the European Banking Authority (EBA), in close cooperation with the European Securities and Markets Authority where applicable, to supplement the regulation and ensure that its requirements are applied uniformly.
EBA Roadmap
Report
The Commission, after consulting the EBA and the European Securities and Markets Authority, should submit a report on the application of the IFR to the European Parliament and the Council of the European Union by 26 June 2024, together with a legislative proposal to review the framework if needed.
It has applied since 26 June 2021.
Regulation (EU) 2019/2033 of the European Parliament and of the Council of 27 November 2019 on the prudential requirements of investment firms and amending Regulations (EU) No 1093/2010, (EU) No 575/2013, (EU) No 600/2014 and (EU) No 806/2014 (OJ L 314, 5.12.2019, pp. 1–63).
Successive amendments to Regulation (EU) 2019/2033 have been incorporated in the original text. This consolidated version is of documentary value only.
Commission Delegated Regulation (EU) 2022/1159 of 11 March 2022 supplementing Regulation (EU) 2019/2033 of the European Parliament and of the Council with regard to regulatory technical standards for public disclosure of investment policy by investment firms (OJ L 179, 6.7.2022, pp. 11–24).
Commission Delegated Regulation (EU) 2022/244 of 24 September 2021 supplementing Regulation (EU) 2019/2033 of the European Parliament and of the Council with regard to regulatory technical standards specifying the amount of total margin for the calculation of the K-factor ‘clear margin given’ (K-CMG) (OJ L 41, 22.2.2022, pp. 1–4).
Commission Implementing Regulation (EU) 2021/2284 of 10 December 2021 laying down implementing technical standards for the application of Regulation (EU) 2019/2033 of the European Parliament and of the Council with regard to supervisory reporting and disclosures of investment firms (OJ L 458, 22.12.2021, pp. 48–172).
Commission Delegated Regulation (EU) 2022/76 of 22 September 2021 supplementing Regulation (EU) 2019/2033 of the European Parliament and of the Council with regard to regulatory technical standards specifying adjustments to the K-factor ‘daily trading flow’ (K-DTF) coefficients (OJ L 13, 20.1.2022, pp. 1–3).
Commission Delegated Regulation (EU) 2022/25 of 22 September 2021 supplementing Regulation (EU) 2019/2033 of the European Parliament and of the Council with regard to regulatory technical standards specifying the methods for measuring the K-factors referred to in Article 15 of that Regulation (OJ L 6, 11.1.2022, pp. 1–6).
Commission Delegated Regulation (EU) 2022/26 of 24 September 2021 supplementing Regulation (EU) 2019/2033 of the European Parliament and of the Council with regard to regulatory technical standards specifying the notion of segregated accounts to ensure client money’s protection in the event of an investment firm’s failure (OJ L 6, 11.1.2022, pp. 7–8).
Directive (EU) 2019/2034 of the European Parliament and of the Council of 27 November 2019 on the prudential supervision of investment firms and amending Directives 2002/87/EC, 2009/65/EC, 2011/61/EU, 2013/36/EU, 2014/59/EU and 2014/65/EU (OJ L 314, 5.12.2019, pp. 64–114).
See consolidated version.
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, pp. 1–90).
See consolidated version.
Regulation (EU) No 600/2014 of the European Parliament and of the Council of 15 May 2014 on markets in financial instruments and amending Regulation (EU) No 648/2012 (OJ L 173, 12.6.2014, pp. 84–148).
See consolidated version.
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, pp. 349–496).
See consolidated version.
Regulation (EU) No 575/2013 of the European Parliament and of the Council of 26 June 2013 on prudential requirements for credit institutions and investment firms and amending Regulation (EU) No 648/2012 (OJ L 176, 27.6.2013, pp. 1–337).
See consolidated version.
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, pp. 12–47).
See consolidated version.
last update 28.06.2022