Circular CSSF 22/814 is a CSSF circular on the monitoring of the threshold and other procedural aspects on the establishment of an intermediate EU parent undertaking under Article 21b of Directive 2013/36/EU (EBA/GL/2021/08), published 25 May 2022.
\nLegal basis: Loi du 20 mai 2021, Law of 5 April 1993 on the financial sector.
\nRelevant for: Credit institutions, Investment firms.
\nKeywords: Authorisation, Internal governance, Single Supervisory Mechanism (SSM).
\nCircular CSSF 22/814 on the monitoring of the threshold and other procedural aspects on the establishment of an intermediate EU parent undertaking under Article 21b of Directive 2013/36/EU (EBA/GL/2021/08)
\nCircular CSSF 22/814 Re: Application of the Guidelines of the European Banking Authority on the monitoring of the threshold and other procedural aspects on the establishment of an intermediate EU parent undertaking under Article 21b of Directive 2013/36/EU (EBA/GL/2021/08)
\nLuxembourg, 25 May 2022
\nPurpose of the Circular
\nTo all credit institutions designated as Less Significant Institutions under the Single Supervisory Mechanism, to investment firms, to Luxembourg branches of credit institutions or of investment firms incorporated in a thirdcountry, as well as financial holding companies, mixed financial holding companies and investment holding companies incorporated in Luxembourg
\nThe purpose of this circular is to inform you that the CSSF, in its capacity as competent authority, applies the Guidelines on the monitoring of the threshold and other procedural aspects on the establishment of an intermediate EU parent undertaking (an IPU) under Article 21b of Directive 2013/36/EU (EBA/GL/2021/08) (the Guidelines), published on 28 July 2021. Consequently, the CSSF has integrated the Guidelines into its administrative practices and regulatory approach with a view to promote supervisory convergence in this field at the European level. All the concerned institutions shall duly comply with the Guidelines. Background According to Article 34-4 of the law on the financial sector (the LFS) 1, two or more credit institutions and/or investment firms established in the EU, which are part of the same third-country group (a TCG), are required to set up an IPU (or, under exceptional cases, two IPUs) if the total value of assets in the EU of the TCG equals, or is greater than, EUR 40 billion (the IPU threshold). For the purpose of calculating the IPU threshold, TCGs shall include the assets of their third-country branches authorised in the EU. The Guidelines The purpose of the Guidelines is to specify a common methodology to calculate the total value of assets in the Union of the TCGs with the aim to establish a consistent application of the IPU requirement. In this respect, the IPU threshold is calculated by adding (see paragraphs 10 and 11 of the Guidelines):
\nArticle 34-4 LFS was inserted in the LFS by the law of 20 May 2021 transposing Directive (EU) 2019/878 of 20 May 2019 amending Directive 2013/36/EU (CRD V).
\nthe assets of the EU parent institutions 2 of a TCG consolidated in the EU in accordance with Article 18 of Regulation (EU) No 575/2013 (EU parent institutions); plus
\nthe assets of stand-alone institutions, namely credit institutions and investment firms whose parent undertaking is located in a thirdcountry and which are not part of a group that would be subject to a consolidated supervision pursuant to Article 111 of Directive 2013/36/EU (stand-alone institutions); plus
\nthe assets of the third-country branches of a TCG, that are authorised in the EU as a credit institution or as an investment firm (third-country branches).
\nIn addition, the Guidelines clarify the period of reference to consider when a TCG is deemed to equal, exceed or fall below the IPU threshold (see paragraphs 12, 13 and 14 of the Guidelines).
\nThe text above is the opening of the document; the PDF carries the whole.
\nDocument page, PDF. Source: Commission de Surveillance du Secteur Financier (CSSF), reproduced with the CSSF's consent. The French text prevails.
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