Response to consultation on Regulatory Technical Standards on cooperation and colleges of supervisors for third-country branches
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Question 1: Do you consider that the provisions on the establishment and functioning of colleges of supervisors for third-country branches set out in Chapter 1 are appropriate and sufficiently clear?
We believe that further clarification is needed in the following areas:
- Articles 48p.2(a) and 48p.2(c) of CRD IV offer two different options for establishing a college of supervisors when a third-country group has both TCBs and subsidiaries within the EU. However, the draft RTS does not address the scenario where a third-country group has TCBs and subsidiaries subject to Article 116 of CRD IV, but no college of supervisors has yet been formed. It is unclear whether, upon the entry into force of CRD VI, a college should be established under Article 48p.2(a) or 48p.2(c). We respectfully request that the EBA clarify this point in the draft RTS. There is concern that a college may initially be formed with the National Competent Authority (NCA) of the largest TCB acting as the lead competent authority, only to be replaced later when a college is established for the group’s subsidiaries under Article 116. Such a transition could disrupt supervisory continuity and should be avoided.
- Regarding Article 14 of the draft RTS, which includes provisions on the exchange of Supervisory Review and Evaluation Process (SREP)-related information, we note that the requirements under Article 48n.6 of CRD VI will be developed in separate guidelines by the EBA. In light of this, we recommend that the draft RTS avoid overly prescriptive provisions and allow flexibility to accommodate future changes.
Question 2: Do you consider that the provisions on the general cooperation and information exchange for the supervision of third-country branches (outside of the college context) set out in Chapter 2 are appropriate and sufficiently clear?
While we support the objective of enhancing cooperation, we are concerned that the draft RTS may be overly prescriptive. We respectfully suggest that:
- Greater flexibility should be granted to competent authorities to exchange information in a manner they consider to be appropriate.
- Reducing the level of prescriptiveness in the draft RTS and allowing colleges to operate based on principles rather than detailed rules would promote a more pragmatic and proportionate approach to supervising third-country groups.
Question 3: Do you consider that the draft RTS provide an appropriate level of proportionality adapted to specific context and nature of third-country branches?
TCBs are part of the same legal entity as the head undertaking and are already considered within the scope of the group supervisory college and crisis management group at the head office level. Cooperation between colleges at both the EU and head office levels is essential to ensure effective and consistent supervision.