What changed, Directive (EU) 2019/2034

+ ### Article 1 — Subject matter
− ### art_1
− Article 1
− 
+ (a) the initial capital of investment firms;
− | (a) | the initial capital of investment firms; |
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+ (b) supervisory powers and tools for the prudential supervision of investment firms by competent authorities;
− | (b) | supervisory powers and tools for the prudential supervision of investment firms by competent authorities; |
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+ (c) the prudential supervision of investment firms by competent authorities in a manner that is consistent with the rules set out in Regulation (EU) 2019/2033;
− | (c) | the prudential supervision of investment firms by competent authorities in a manner that is consistent with the rules set out in Regulation (EU) 2019/2033; |
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+ (d) publication requirements for competent authorities in the field of prudential regulation and supervision of investment firms.
− | (d) | publication requirements for competent authorities in the field of prudential regulation and supervision of investment firms. |
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+ ### Article 2 — Scope
− ### art_2
+ **1.** This Directive applies to investment firms authorised and supervised under Directive 2014/65/EU.
− Article 2
+ **2.** By way of derogation from paragraph 1, Titles IV and V of this Directive do not apply to investment firms referred to in Article 1(2) and (5) of Regulation (EU) 2019/2033, which shall be supervised for compliance with prudential requirements under Titles VII and VIII of Directive 2013/36/EU i…
− 1. This Directive applies to investment firms authorised and supervised under Directive 2014/65/EU.
+ ### Article 3 — Definitions
− 2. By way of derogation from paragraph 1, Titles IV and V of this Directive do not apply to investment firms referred to in Article 1(2) and (5) of Regulation (EU) 2019/2033, which shall be supervised for compliance with prudential requirements under Titles VII and VIII of Directive 2013/36/EU in ac…
+ **1.** For the purposes of this Directive, the following definitions apply:(1) ‘ancillary services undertaking’ means an undertaking, the principal activity of which consists of owning or managing property, managing data‐processing services, or a similar activity which is ancillary to the principal …
− ### art_3
+ **2.** The Commission is empowered to adopt delegated acts in accordance with Article 58 to supplement this Directive by clarifying the definitions set out in paragraph 1 in order to:(a) ensure the uniform application of this Directive;(b) take account, in the application of this Directive, of devel…
− Article 3
+ ### Article 4 — Designation and powers of the competent authorities
− 1. For the purposes of this Directive, the following definitions apply:
+ **1.** Member States shall designate one or more competent authorities to carry out the functions and duties provided for in this Directive and in Regulation (EU) 2019/2033. The Member States shall inform the Commission, EBA and ESMA of that designation, and, where there is more than one competent a…
− | (1) | ‘ancillary services undertaking’ means an undertaking, the principal activity of which consists of owning or managing property, managing data‐processing services, or a similar activity which is ancillary to the principal activity of one or more investment firms; |
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+ **2.** Member States shall ensure that the competent authorities supervise the activities of investment firms, and, where applicable, of investment holding companies and mixed financial holding companies, to assess compliance with the requirements of this Directive and of Regulation (EU) 2019/2033.
− | (2) | ‘authorisation’ means authorisation of an investment firm in accordance with Article 5 of Directive 2014/65/EU; |
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+ **3.** Member States shall ensure that the competent authorities have all necessary powers, including the power to conduct on‐the‐spot checks in accordance with Article 14, to obtain the information needed to assess the compliance of investment firms and, where applicable, of investment holding comp…
− | (3) | ‘branch’ means a branch as defined in point (30) of Article 4(1) of Directive 2014/65/EU; |
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+ **4.** Member States shall ensure that the competent authorities have the expertise, resources, operational capacity, powers and independence necessary to carry out the functions relating to the prudential supervision, investigations and sanctions set out in this Directive.
− | (4) | ‘close links’ means close links as defined in point (35) of Article 4(1) of Directive 2014/65/EU; |
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+ **5.** Member States shall require investment firms to provide their competent authorities with all the information necessary for the assessment of the compliance of investment firms with the national provisions transposing this Directive and compliance with Regulation (EU) 2019/2033. Internal contr…
− | (5) | ‘competent authority’ means a public authority or body of a Member State that is officially recognised and empowered by national law to supervise investment firms in accordance with this Directive, as part of the supervisory system in operation in that Member State; |
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+ **6.** Member States shall ensure that investment firms record all their transactions and document the systems and processes which are subject to this Directive and to Regulation (EU) 2019/2033 in such a manner that the competent authorities are able to assess compliance with the national provisions…
− | (6) | ‘commodity and emission allowance dealer’ means a commodity and emission allowance dealer as defined in point (150) of Article 4(1) of Regulation (EU) No 575/2013; |
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+ ### Article 5 — Discretion of competent authorities to subject certain investment firms to the requirements of Regulation (EU) No 575/2013
− | (7) | ‘control’ means the relationship between a parent undertaking and a subsidiary, as described in Article 22 of Directive 2013/34/EU of the European Parliament and of the Council (17), or in the accounting standards to which an investment firm is subject under Regulation (EC) No 1606/2002 of t…
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+ **1.** Competent authorities may decide to apply the requirements of Regulation (EU) No 575/2013 pursuant to point (c) of the first subparagraph of Article 1(2) of Regulation (EU) 2019/2033 to an investment firm that carries out any of the activities listed in points (3) and (6) of Section A of Anne…
− | (8) | ‘compliance with the group capital test’ means compliance by a parent undertaking in an investment firm group with the requirements of Article 8 of Regulation (EU) 2019/2033; |
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+ **2.** Paragraph 1 shall not apply to commodity and emission allowance dealers, collective investment undertakings or insurance undertakings.
− | (9) | ‘credit institution’ means a credit institution as defined in point (1) of Article 4(1) of Regulation (EU) No 575/2013; |
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+ **3.** Where a competent authority decides to apply the requirements of Regulation (EU) No 575/2013 to an investment firm in accordance with paragraph 1, that investment firm shall be supervised for compliance with prudential requirements under Titles VII and VIII of Directive 2013/36/EU.
− | (10) | ‘derivatives’ means derivatives as defined in point (29) of Article 2(1) of Regulation (EU) No 600/2014 of the European Parliament and of the Council (19); |
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+ **4.** Where a competent authority decides to revoke a decision taken in accordance with paragraph 1, it shall inform the investment firm without delay.
− | (11) | ‘financial institution’ means a financial institution as defined in point (14) of Article 4(1) of Regulation (EU) 2019/2033; |
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− 
− | (12) | ‘gender neutral remuneration policy’ means gender neutral remuneration policy as defined in point (65) of Article 3(1) of Directive 2013/36/EU, as amended by Directive (EU) 2019/878 of the European Parliament and of the Council (20); |
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− 
− | (13) | ‘group’ means a group as defined in point (11) of Article 2 of Directive 2013/34/EU; |
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− 
− | (14) | ‘consolidated situation’ means a consolidated situation as defined in point (11) of Article 4(1) of Regulation (EU) 2019/2033; |
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− 
− | (15) | ‘group supervisor’ means a competent authority responsible for the supervision of compliance with the group capital test of Union parent investment firms and investment firms controlled by Union parent investment holding companies or Union parent mixed financial holding companies; |
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− 
− | (16) | ‘home Member State’ means a home Member State as defined in point (55)(a) of Article 4(1) of Directive 2014/65/EU; |
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− 
− | (17) | ‘host Member State’ means a host Member State as defined in point (56) of Article 4(1) of Directive 2014/65/EU; |
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− 
− | (18) | ‘initial capital’ means the capital which is required for the purposes of authorisation as an investment firm, the amount and type of which are specified in Articles 9 and 11; |
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− 
− | (19) | ‘investment firm’ means an investment firm as defined in point (1) Article 4(1) of Directive 2014/65/EU; |
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− 
− | (20) | ‘investment firm group’ means an investment firm group as defined in point (25) of Article 4(1) of Regulation (EU) 2019/2033; |
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− 
− | (21) | ‘investment holding company’ means an investment holding company as defined in point (23) of Article 4(1) of Regulation (EU) 2019/2033; |
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− 
− | (22) | ‘investment services and activities’ means investment services and activities as defined in point (2) of Article 4(1) of Directive 2014/65/EU; |
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− 
− | (23) | ‘management body’ means a management body as defined in point (36) of Article 4(1) of Directive 2014/65/EU; |
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− 
− | (24) | ‘management body in its supervisory function’ means the management body acting in its role of overseeing and monitoring management decision‐making; |
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− 
− | (25) | ‘mixed financial holding company’ means a mixed financial holding company as defined in point (15) of Article 2 of Directive 2002/87/EC of the European Parliament and of the Council (21); |
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− 
− | (26) | ‘mixed‐activity holding company’ means a parent undertaking other than a financial holding company, an investment holding company, a credit institution, an investment firm, or a mixed financial holding company within the meaning of Directive 2002/87/EC, the subsidiaries of which include at …
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− 
− | (27) | ‘senior management’ means senior management as defined in point (37) of Article 4(1) Directive 2014/65/EU; |
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− 
− | (28) | ‘parent undertaking’ means a parent undertaking as defined in point (32) of Article 4(1) of Directive 2014/65/EU; |
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− 
− | (29) | ‘subsidiary’ means a subsidiary as defined in point (33) of Article 4(1) of Directive 2014/65/EU; |
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− 
− | (30) | ‘systemic risk’ means systemic risk as defined in point (10) of Article 3(1) of Directive 2013/36/EU; |
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− 
− | (31) | ‘Union parent investment firm’ means a Union parent investment firm as defined in point (56) of Article 4(1) of Regulation (EU) 2019/2033; |
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− 
− | (32) | ‘Union parent investment holding company’ means a Union parent investment holding company as defined in point (57) of Article 4(1) of Regulation (EU) 2019/2033; |
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− 
− | (33) | ‘Union parent mixed financial holding company’ means a Union parent mixed financial holding company as defined in point (58) of Article 4(1) of Regulation (EU) 2019/2033. |
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− 
− 2. The Commission is empowered to adopt delegated acts in accordance with Article 58 to supplement this Directive by clarifying the definitions set out in paragraph 1 in order to:
− 
− | (a) | ensure the uniform application of this Directive; |
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− 
− | (b) | take account, in the application of this Directive, of developments on financial markets. |
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− 
− ### art_4
− 
− Article 4
− 1. Member States shall designate one or more competent authorities to carry out the functions and duties provided for in this Directive and in Regulation (EU) 2019/2033. The Member States shall inform the Commission, EBA and ESMA of that designation, and, where there is more than one competent autho…
− 
− 2. Member States shall ensure that the competent authorities supervise the activities of investment firms, and, where applicable, of investment holding companies and mixed financial holding companies, to assess compliance with the requirements of this Directive and of Regulation (EU) 2019/2033.
− 
− 3. Member States shall ensure that the competent authorities have all necessary powers, including the power to conduct on‐the‐spot checks in accordance with Article 14, to obtain the information needed to assess the compliance of investment firms and, where applicable, of investment holding companie…
− 
− 4. Member States shall ensure that the competent authorities have the expertise, resources, operational capacity, powers and independence necessary to carry out the functions relating to the prudential supervision, investigations and sanctions set out in this Directive.
− 
− 5. Member States shall require investment firms to provide their competent authorities with all the information necessary for the assessment of the compliance of investment firms with the national provisions transposing this Directive and compliance with Regulation (EU) 2019/2033. Internal control m…
− 
− 6. Member States shall ensure that investment firms record all their transactions and document the systems and processes which are subject to this Directive and to Regulation (EU) 2019/2033 in such a manner that the competent authorities are able to assess compliance with the national provisions tra…
− 
− ### art_5
− 
− Article 5
− 
− 1. Competent authorities may decide to apply the requirements of Regulation (EU) No 575/2013 pursuant to point (c) of the first subparagraph of Article 1(2) of Regulation (EU) 2019/2033 to an investment firm that carries out any of the activities listed in points (3) and (6) of Section A of Annex I …
− 
− | (a) | the investment firm carries out those activities on such a scale that the failure or the distress of the investment firm could lead to systemic risk; |
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− 
− | (b) | the investment firm is a clearing member as defined in point (3) of Article 4(1) of Regulation (EU) 2019/2033; |
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− 
− | (c) | the competent authority considers it to be justified in light of the size, nature, scale and complexity of the activities of the investment firm concerned, taking into account the principle of proportionality and having regard to one or more of the following factors:(i)the importance of the …
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− | (i) | the importance of the investment firm for the economy of the Union or of the relevant Member State; |
− | (ii) | the significance of the investment firm’s cross‐border activities; |
− | (iii) | the interconnectedness of the investment firm with the financial system. |
− 
− 2. Paragraph 1 shall not apply to commodity and emission allowance dealers, collective investment undertakings or insurance undertakings.
− 
− 3. Where a competent authority decides to apply the requirements of Regulation (EU) No 575/2013 to an investment firm in accordance with paragraph 1, that investment firm shall be supervised for compliance with prudential requirements under Titles VII and VIII of Directive 2013/36/EU.
− 
− 4. Where a competent authority decides to revoke a decision taken in accordance with paragraph 1, it shall inform the investment firm without delay.
− 
+ **5.** Competent authorities shall inform EBA without delay of any decision taken pursuant to paragraphs 1, 3 and 4.
− 5. Competent authorities shall inform EBA without delay of any decision taken pursuant to paragraphs 1, 3 and 4.
+ **6.** EBA, in consultation with ESMA, shall develop draft regulatory technical standards to further specify the criteria set out in points (a) and (b) of paragraph 1, and shall ensure their consistent application.
− 6. EBA, in consultation with ESMA, shall develop draft regulatory technical standards to further specify the criteria set out in points (a) and (b) of paragraph 1, and shall ensure their consistent application.
+ ### Article 6 — Cooperation within a Member State
− ### art_6
+ **1.** Competent authorities shall cooperate closely with the public authorities or bodies responsible in their Member State for the supervision of credit institutions and financial institutions. Member States shall require that those competent authorities and those public authorities or bodies exch…
− Article 6
+ **2.** Competent authorities that are different from those designated in accordance with Article 67 of Directive 2014/65/EU shall establish a mechanism for cooperation with those authorities and for the exchange of all information that is relevant for the exercise of their respective functions and d…
− 1. Competent authorities shall cooperate closely with the public authorities or bodies responsible in their Member State for the supervision of credit institutions and financial institutions. Member States shall require that those competent authorities and those public authorities or bodies exchange…
+ ### Article 7 — Cooperation within the European System of Financial Supervision
− 2. Competent authorities that are different from those designated in accordance with Article 67 of Directive 2014/65/EU shall establish a mechanism for cooperation with those authorities and for the exchange of all information that is relevant for the exercise of their respective functions and dutie…
+ **1.** In the exercise of their duties, competent authorities shall take into account the convergence of supervisory tools and supervisory practices in the application of the legal provisions adopted pursuant to this Directive and to Regulation (EU) 2019/2033.
− ### art_7
+ **2.** Member States shall ensure that:(a) competent authorities, as parties to the ESFS, cooperate with trust and full mutual respect, in particular when ensuring the exchange of appropriate, reliable and exhaustive information between them and other parties to the ESFS;(b) competent authorities pa…
− Article 7
+ ### Article 8 — Union dimension of supervision
− 1. In the exercise of their duties, competent authorities shall take into account the convergence of supervisory tools and supervisory practices in the application of the legal provisions adopted pursuant to this Directive and to Regulation (EU) 2019/2033.
− 
− 2. Member States shall ensure that:
− 
− | (a) | competent authorities, as parties to the ESFS, cooperate with trust and full mutual respect, in particular when ensuring the exchange of appropriate, reliable and exhaustive information between them and other parties to the ESFS; |
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− 
− | (b) | competent authorities participate in the activities of EBA, and, as appropriate, in the colleges of supervisors referred to in Article 48 of this Directive and in Article 116 of Directive 2013/36/EU; |
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− 
− | (c) | competent authorities make every effort to ensure compliance with the guidelines and recommendations issued by EBA pursuant to Article 16 of Regulation (EU) No 1093/2010 and to respond to the warnings and recommendations issued by the European Systemic Risk Board (ESRB) pursuant to Article 1…
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− 
− | (d) | competent authorities cooperate closely with the ESRB; |
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− 
− | (e) | tasks and powers conferred on the competent authorities do not inhibit the performance of the duties of those competent authorities as members of EBA or of the ESRB, or under this Directive and under Regulation (EU) 2019/2033. |
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− 
− ### art_8
− 
− Article 8
+ ### Article 9 — Initial capital
− ### art_9
+ **1.** The initial capital of an investment firm required pursuant to Article 15 of Directive 2014/65/EU for the authorisation to provide any of the investment services or perform any of the investment activities listed in points (3) and (6) of Section A of Annex I to Directive 2014/65/EU shall be E…
− Article 9
+ **2.** The initial capital of an investment firm required pursuant to Article 15 of Directive 2014/65/EU for the authorisation to provide any of the investment services or perform any of the investment activities listed in points (1), (2), (4), (5) and (7) of Section A of Annex I to Directive 2014/6…
− 1. The initial capital of an investment firm required pursuant to Article 15 of Directive 2014/65/EU for the authorisation to provide any of the investment services or perform any of the investment activities listed in points (3) and (6) of Section A of Annex I to Directive 2014/65/EU shall be EUR 7…
− 
− 2. The initial capital of an investment firm required pursuant to Article 15 of Directive 2014/65/EU for the authorisation to provide any of the investment services or perform any of the investment activities listed in points (1), (2), (4), (5) and (7) of Section A of Annex I to Directive 2014/65/EU…
+ **3.** The initial capital of an investment firm required pursuant to Article 15 of Directive 2014/65/EU for investment firms other than those referred to in paragraphs 1, 2 and 4 of this Article shall be EUR 150 000 .
− 3. The initial capital of an investment firm required pursuant to Article 15 of Directive 2014/65/EU for investment firms other than those referred to in paragraphs 1, 2 and 4 of this Article shall be EUR 150 000.
+ **4.** The initial capital of an investment firm authorised to provide the investment services or perform the investment activity listed in point (9) of Section A of Annex I to Directive 2014/65/EU, where that investment firm engages in dealing on own account or is permitted to do so, shall be EUR 7…
− 4. The initial capital of an investment firm authorised to provide the investment services or perform the investment activity listed in point (9) of Section A of Annex I to Directive 2014/65/EU, where that investment firm engages in dealing on own account or is permitted to do so, shall be EUR 750 0…
− 
− ### art_10
+ ### Article 10 — References to initial capital in Directive 2013/36/EU
− Article 10
+ (a) references to initial capital of investment firms in Article 28 of Directive 2013/36/EU shall be construed as references to Article 9(1) of this Directive;
− | (a) | references to initial capital of investment firms in Article 28 of Directive 2013/36/EU shall be construed as references to Article 9(1) of this Directive; |
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+ (b) references to initial capital of investment firms in Articles 29 and 31 of Directive 2013/36/EU shall be construed as references to Article 9(2), (3) or (4) of this Directive, depending on the types of investment services and activities of the investment firm;
− | (b) | references to initial capital of investment firms in Articles 29 and 31 of Directive 2013/36/EU shall be construed as references to Article 9(2), (3) or (4) of this Directive, depending on the types of investment services and activities of the investment firm; |
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+ (c) references to initial capital in Article 30 of Directive 2013/36/EU shall be construed as references to Article 9(1) of this Directive.
− | (c) | references to initial capital in Article 30 of Directive 2013/36/EU shall be construed as references to Article 9(1) of this Directive. |
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+ ### Article 11 — Composition of initial capital
− ### art_11
− 
− Article 11
− 
− ### art_12
+ ### Article 12 — Competence of the competent authorities of the home and host Member State
− Article 12
+ ### Article 13 — Cooperation between competent authorities of different Member States
− ### art_13
+ **1.** Competent authorities of different Member States shall cooperate closely for the purposes of their duties pursuant to this Directive and to Regulation (EU) 2019/2033, in particular by exchanging information about investment firms without delay, including the following:(a) information about th…
− Article 13
+ **2.** The competent authorities of the home Member State shall immediately provide the competent authorities of the host Member State with any information and findings about any potential problems and risks posed by an investment firm to the protection of clients or the stability of the financial s…
− 1. Competent authorities of different Member States shall cooperate closely for the purposes of their duties pursuant to this Directive and to Regulation (EU) 2019/2033, in particular by exchanging information about investment firms without delay, including the following:
+ **3.** The competent authorities of the home Member State shall act upon information provided by the competent authorities of the host Member State by taking all measures necessary to avert or remedy potential problems and risks as referred to in paragraph 2. Upon request, the competent authorities …
− | (a) | information about the management and ownership structure of the investment firm; |
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+ **4.** Where, following the communication of the information and findings referred to in paragraph 2, the competent authorities of the host Member State consider that the competent authorities of the home Member State have not taken the necessary measures referred to in paragraph 3, the competent au…
− | (b) | information about compliance with own funds requirements by the investment firm; |
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− 
− | (c) | information about compliance with the concentration risk requirements and liquidity requirements of the investment firm; |
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− 
− | (d) | information about the administrative and accounting procedures and internal control mechanisms of the investment firm; |
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− 
− | (e) | any other relevant factors that may influence the risk posed by the investment firm. |
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− 
− 2. The competent authorities of the home Member State shall immediately provide the competent authorities of the host Member State with any information and findings about any potential problems and risks posed by an investment firm to the protection of clients or the stability of the financial syste…
− 
− 3. The competent authorities of the home Member State shall act upon information provided by the competent authorities of the host Member State by taking all measures necessary to avert or remedy potential problems and risks as referred to in paragraph 2. Upon request, the competent authorities of t…
− 
− 4. Where, following the communication of the information and findings referred to in paragraph 2, the competent authorities of the host Member State consider that the competent authorities of the home Member State have not taken the necessary measures referred to in paragraph 3, the competent author…
+ **5.** Competent authorities of the home Member State that disagree with the measures of the competent authorities of the host Member State may refer the matter to EBA, which shall act in accordance with the procedure laid down in Article 19 of Regulation (EU) No 1093/2010. Where EBA acts in accorda…
− 5. Competent authorities of the home Member State that disagree with the measures of the competent authorities of the host Member State may refer the matter to EBA, which shall act in accordance with the procedure laid down in Article 19 of Regulation (EU) No 1093/2010. Where EBA acts in accordance …
+ **6.** For the purpose of assessing the condition in point (c) of the first subparagraph of Article 23(1) of Regulation (EU) 2019/2033, the competent authority of an investment firm’s home Member State may request the competent authority of a clearing member’s home Member State to provide informatio…
− 6. For the purpose of assessing the condition in point (c) of the first subparagraph of Article 23(1) of Regulation (EU) 2019/2033, the competent authority of an investment firm’s home Member State may request the competent authority of a clearing member’s home Member State to provide information re…
+ **7.** EBA, in consultation with ESMA, shall develop draft regulatory technical standards to specify requirements for the type and nature of the information referred to in paragraphs 1 and 2 of this Article.
− 7. EBA, in consultation with ESMA, shall develop draft regulatory technical standards to specify requirements for the type and nature of the information referred to in paragraphs 1 and 2 of this Article.
+ **8.** EBA, in consultation with ESMA, shall develop draft implementing technical standards to establish standard forms, templates and procedures for the information sharing requirements for the purpose of facilitating the supervision of investment firms.
− 8. EBA, in consultation with ESMA, shall develop draft implementing technical standards to establish standard forms, templates and procedures for the information sharing requirements for the purpose of facilitating the supervision of investment firms.
+ **9.** EBA shall submit the draft technical standards referred to in paragraphs 7 and 8 to the Commission by 26 June 2021.
− 9. EBA shall submit the draft technical standards referred to in paragraphs 7 and 8 to the Commission by 26 June 2021.
+ ### Article 14 — On‐the‐spot checking and inspection of branches established in another Member State
− ### art_14
+ **1.** Host Member States shall provide that, where an investment firm authorised in another Member State carries out its activities through a branch, the competent authorities of the home Member State may, after having informed the competent authorities of the host Member State, carry out, themselv…
− Article 14
+ **2.** The competent authorities of the host Member State shall, for supervisory purposes and where they consider it to be relevant for reasons of stability of the financial system in the host Member State, have the power to carry out, on a case‐by‐case basis, on‐the‐spot checks and inspections of t…
− 1. Host Member States shall provide that, where an investment firm authorised in another Member State carries out its activities through a branch, the competent authorities of the home Member State may, after having informed the competent authorities of the host Member State, carry out, themselves o…
− 2. The competent authorities of the host Member State shall, for supervisory purposes and where they consider it to be relevant for reasons of stability of the financial system in the host Member State, have the power to carry out, on a case‐by‐case basis, on‐the‐spot checks and inspections of the a…
− 
+ ### Article 15 — Professional secrecy and exchange of confidential information
− ### art_15
+ **1.** Member States shall ensure that competent authorities and all persons who work or who have worked for those competent authorities, including the persons referred to in Article 76(1) of Directive 2014/65/EU, are bound by the obligation of professional secrecy for the purposes of this Directive…
− Article 15
− 1. Member States shall ensure that competent authorities and all persons who work or who have worked for those competent authorities, including the persons referred to in Article 76(1) of Directive 2014/65/EU, are bound by the obligation of professional secrecy for the purposes of this Directive and…
− 
+ **2.** Competent authorities shall use the confidential information collected, exchanged or transmitted pursuant to this Directive and to Regulation (EU) 2019/2033 only for the purpose of carrying out their duties, and in particular for the following purposes:(a) to monitor the prudential rules set …
− 2. Competent authorities shall use the confidential information collected, exchanged or transmitted pursuant to this Directive and to Regulation (EU) 2019/2033 only for the purpose of carrying out their duties, and in particular for the following purposes:
+ **3.** Natural and legal persons and other bodies, other than competent authorities, that receive confidential information pursuant to this Directive and to Regulation (EU) 2019/2033 shall use that information only for the purposes for which the competent authority expressly provides or in accordanc…
− | (a) | to monitor the prudential rules set out in this Directive and in Regulation (EU) 2019/2033; |
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+ **4.** Competent authorities may exchange confidential information for the purposes of paragraph 2, may expressly state how that information is to be treated and may expressly restrict any further transmission of that information.
− | (b) | to impose sanctions; |
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+ **5.** The obligation referred to in paragraph 1 shall not prevent competent authorities from transmitting confidential information to the Commission when that information is necessary for the exercise of the powers of the Commission.
− | (c) | in administrative appeals against decisions of the competent authorities; |
− | --- | --- |
+ **6.** Competent authorities may provide EBA, ESMA, the ESRB, central banks of the Member States, the European System of Central Banks (ESCB) and the European Central Bank in their capacity as monetary authorities, and, where appropriate, public authorities responsible for overseeing payment and set…
− | (d) | in court proceedings initiated under Article 23. |
− | --- | --- |
+ ### Article 16 — Cooperation arrangements with third countries for the exchange of information
− 3. Natural and legal persons and other bodies, other than competent authorities, that receive confidential information pursuant to this Directive and to Regulation (EU) 2019/2033 shall use that information only for the purposes for which the competent authority expressly provides or in accordance wi…
− 
− 4. Competent authorities may exchange confidential information for the purposes of paragraph 2, may expressly state how that information is to be treated and may expressly restrict any further transmission of that information.
− 
− 5. The obligation referred to in paragraph 1 shall not prevent competent authorities from transmitting confidential information to the Commission when that information is necessary for the exercise of the powers of the Commission.
− 
− 6. Competent authorities may provide EBA, ESMA, the ESRB, central banks of the Member States, the European System of Central Banks (ESCB) and the European Central Bank in their capacity as monetary authorities, and, where appropriate, public authorities responsible for overseeing payment and settlem…
− 
− ### art_16
− 
− Article 16
− 
− | (a) | the supervision of financial institutions and financial markets, including the supervision of financial entities licensed to operate as central counterparties, where central counterparties have been recognised under Article 25 of Regulation (EU) No 648/2012 of the European Parliament and of …
− | --- | --- |
+ (a) the supervision of financial institutions and financial markets, including the supervision of financial entities licensed to operate as central counterparties, where central counterparties have been recognised under Article 25 of Regulation (EU) No 648/2012 of the European Parliament and of the …
− | (b) | the liquidation and bankruptcy of investment firms and similar procedures; |
− | --- | --- |
+ (b) the liquidation and bankruptcy of investment firms and similar procedures;
− | (c) | oversight of the bodies involved in the liquidation and bankruptcy of investment firms and similar procedures; |
− | --- | --- |
+ (c) oversight of the bodies involved in the liquidation and bankruptcy of investment firms and similar procedures;
− | (d) | the carrying out of statutory audits of financial institutions or institutions which administer compensation schemes; |
− | --- | --- |
+ (d) the carrying out of statutory audits of financial institutions or institutions which administer compensation schemes;
− | (e) | oversight of persons charged with carrying out statutory audits of the accounts of financial institutions; |
− | --- | --- |
+ (e) oversight of persons charged with carrying out statutory audits of the accounts of financial institutions;
− | (f) | oversight of persons active on emission allowance markets for the purpose of ensuring a consolidated overview of financial and spot markets; |
− | --- | --- |
+ (f) oversight of persons active on emission allowance markets for the purpose of ensuring a consolidated overview of financial and spot markets;
− | (g) | oversight of persons active on agricultural commodity derivatives markets for the purpose of ensuring a consolidated overview of financial and spot markets. |
− | --- | --- |
+ (g) oversight of persons active on agricultural commodity derivatives markets for the purpose of ensuring a consolidated overview of financial and spot markets.
− ### art_17
+ ### Article 17 — Duties of persons responsible for the control of annual and consolidated accounts
− Article 17
+ Member States shall provide that any person who is authorised in accordance with Directive 2006/43/EC of the European Parliament and of the Council (8) and who performs in an investment firm the tasks described in Article 73 of Directive 2009/65/EC or in Article 34 of Directive 2013/34/EU, or any ot…
− Member States shall provide that any person who is authorised in accordance with Directive 2006/43/EC of the European Parliament and of the Council (24) and who performs in an investment firm the tasks described in Article 73 of Directive 2009/65/EC or in Article 34 of Directive 2013/34/EU, or any o…
+ (a) constitutes a material breach of the laws, regulations or administrative provisions laid down pursuant to this Directive;
− | (a) | constitutes a material breach of the laws, regulations or administrative provisions laid down pursuant to this Directive; |
− | --- | --- |
+ (b) may affect the continuous functioning of the investment firm; or
− | (b) | may affect the continuous functioning of the investment firm; or |
− | --- | --- |
+ (c) may lead to a refusal to certify the accounts or can lead to the expression of reservations.
− | (c) | may lead to a refusal to certify the accounts or can lead to the expression of reservations. |
− | --- | --- |
+ ### Article 18 — Administrative sanctions and other administrative measures
− ### art_18
+ **1.** Without prejudice to the supervisory powers referred to in Section 4 of Chapter 2 of Title IV of this Directive, including investigatory powers and powers of competent authorities to impose remedies, and the right of Member States to provide for and impose criminal sanctions, Member States sh…
− Article 18
− 
− 1. Without prejudice to the supervisory powers referred to in Section 4 of Chapter 2 of Title IV of this Directive, including investigatory powers and powers of competent authorities to impose remedies, and the right of Member States to provide for and impose criminal sanctions, Member States shall …
− 
− | (a) | fails to have in place internal governance arrangements as set out in Article 26; |
− | --- | --- |
− 
− | (b) | fails to report information or provides incomplete or inaccurate information on compliance with the obligation to meet own funds requirements set out in Article 11 of Regulation (EU) 2019/2033 to the competent authorities, in breach of point (b) of Article 54(1) of that Regulation; |
− | --- | --- |
− | (c) | fails to report to the competent authorities, in breach of point (e) of Article 54(1) of Regulation (EU) 2019/2033, information about concentration risk or provides incomplete or inaccurate information; |
− | --- | --- |
− 
− | (d) | incurs a concentration risk in excess of the limits set out in Article 37 of Regulation (EU) 2019/2033, without prejudice to Articles 38 and 39 of that Regulation; |
− | --- | --- |
− 
− | (e) | repeatedly or persistently fails to hold liquid assets in breach of Article 43 of Regulation (EU) 2019/2033, without prejudice to Article 44 of that Regulation; |
− | --- | --- |
− 
− | (f) | fails to disclose information, or provides incomplete or inaccurate information, in breach of the provisions set out in Part Six of Regulation (EU) 2019/2033; |
− | --- | --- |
− 
− | (g) | makes payments to holders of instruments included in the own funds of the investment firm where Article 28, 52 or 63 of Regulation (EU) No 575/2013 prohibit such payments to holders of instruments included in own funds; |
− | --- | --- |
− 
− | (h) | is found liable for a serious breach of national provisions adopted pursuant to Directive (EU) 2015/849 of the European Parliament and of the Council (25); |
− | --- | --- |
− 
− | (i) | allows one or more persons that do not comply with Article 91 of Directive 2013/36/EU to become or remain a member of the management body. |
− | --- | --- |
− 
+ **2.** The administrative sanctions and other administrative measures referred to in the first subparagraph of paragraph 1 shall include the following:(a) a public statement which identifies the natural or legal person, investment firm, investment holding company or mixed financial holding company r…
− 2. The administrative sanctions and other administrative measures referred to in the first subparagraph of paragraph 1 shall include the following:
− | (a) | a public statement which identifies the natural or legal person, investment firm, investment holding company or mixed financial holding company responsible and the nature of the breach; |
− | --- | --- |
− 
− | (b) | an order requiring the natural or legal person responsible to cease the conduct and to desist from repeating that conduct; |
− | --- | --- |
− 
− | (c) | a temporary ban for members of the investment firm’s management body or any other natural persons who are held responsible on exercising functions in investment firms; |
− | --- | --- |
− 
− | (d) | in case of a legal person, administrative pecuniary sanctions of up to 10 % of the total annual net turnover, including the gross income consisting of interest receivable and similar income, income from shares and other variable or fixed‐yield securities, and commissions or fees of the under…
− | --- | --- |
− 
− | (e) | in the case of a legal person, administrative pecuniary sanctions of up to twice the amount of the profits gained or losses avoided due to the breach where those profits or losses can be determined; |
− | --- | --- |
− 
− | (f) | in the case of a natural person, administrative pecuniary sanctions of up to EUR 5 000 000, or in the Member States whose currency is not the euro, the corresponding value in the national currency on 25 December 2019. |
− | --- | --- |
− 
+ **3.** Member States shall ensure that, when determining the type of administrative sanctions or other administrative measures referred to in paragraph 1 and the level of administrative pecuniary sanctions, competent authorities shall take into account all relevant circumstances, including, where ap…
− 3. Member States shall ensure that, when determining the type of administrative sanctions or other administrative measures referred to in paragraph 1 and the level of administrative pecuniary sanctions, competent authorities shall take into account all relevant circumstances, including, where approp…
+ ### Article 19 — Investigatory powers
− | (a) | the gravity and the duration of the breach; |
− | --- | --- |
− | (b) | the degree of responsibility of the natural or legal persons responsible for the breach; |
− | --- | --- |
− 
− | (c) | the financial strength of the natural or legal persons responsible for the breach, including the total turnover of legal persons or the annual income of natural persons; |
− | --- | --- |
− 
− | (d) | the importance of profits gained or losses avoided by the legal persons responsible for the breach; |
− | --- | --- |
− 
− | (e) | any losses incurred by third parties as a result of the breach; |
− | --- | --- |
− 
− | (f) | the level of cooperation with the relevant competent authorities; |
− | --- | --- |
− 
− | (g) | previous breaches by the natural or legal persons responsible for the breach; |
− | --- | --- |
− 
− | (h) | any potential systemic consequences of the breach. |
− | --- | --- |
− 
− ### art_19
− 
− Article 19
− 
+ (a) the power to require information from the following natural or legal persons: (i) investment firms established in the Member State concerned; (ii) investment holding companies established in the Member State concerned; (iii) mixed financial holding companies established in the Member State conce…
− | (a) | the power to require information from the following natural or legal persons:(i)investment firms established in the Member State concerned;(ii)investment holding companies established in the Member State concerned;(iii)mixed financial holding companies established in the Member State concern…
− | --- | --- |
− | (i) | investment firms established in the Member State concerned; |
− | (ii) | investment holding companies established in the Member State concerned; |
− | (iii) | mixed financial holding companies established in the Member State concerned; |
− | (iv) | mixed‐activity holding companies established in the Member State concerned; |
− | (v) | persons belonging to the entities referred to in points (i) to (iv); |
− | (vi) | third parties to whom the entities referred to in points (i) to (iv) have outsourced operational functions or activities; |
+ (b) the power to conduct all necessary investigations of any person referred to in point (a) that is established or located in the Member State concerned, including the right: (i) to require the submission of documents by the persons referred to in point (a); (ii) to examine the books and records of…
− | (b) | the power to conduct all necessary investigations of any person referred to in point (a) that is established or located in the Member State concerned, including the right:(i)to require the submission of documents by the persons referred to in point (a);(ii)to examine the books and records of…
− | --- | --- |
− | (i) | to require the submission of documents by the persons referred to in point (a); |
− | (ii) | to examine the books and records of the persons referred to in point (a) and to make copies or extracts from those books and records; |
− | (iii) | to obtain written or oral explanations from the persons referred to in point (a) or from their representatives or staff; |
− | (iv) | to interview any other relevant person for the purpose of collecting information on the subject matter of an investigation; |
+ (c) the power to conduct all necessary inspections at the business premises of the legal persons referred to in point (a) and any other undertakings included in the supervision of compliance with the group capital test, where the competent authority is the group supervisor, subject to the prior noti…
− | (c) | the power to conduct all necessary inspections at the business premises of the legal persons referred to in point (a) and any other undertakings included in the supervision of compliance with the group capital test, where the competent authority is the group supervisor, subject to the prior …
− | --- | --- |
+ ### Article 20 — Publication of administrative sanctions and other administrative measures
− ### art_20
+ **1.** Member States shall ensure that competent authorities publish on their official website without undue delay any administrative sanctions and other administrative measures imposed in accordance with Article 18 and which have not been appealed or can no longer be appealed. That publication shal…
− Article 20
+ **2.** Where Member States permit the publication of administrative sanctions or other administrative measures imposed in accordance with Article 18 against which there has been an appeal, competent authorities shall also publish on their official website information on the appeal status and on the …
− 1. Member States shall ensure that competent authorities publish on their official website without undue delay any administrative sanctions and other administrative measures imposed in accordance with Article 18 and which have not been appealed or can no longer be appealed. That publication shall in…
+ **3.** Competent authorities shall publish the administrative sanctions or other administrative measures imposed in accordance with Article 18 on an anonymous basis in any of the following circumstances:(a) the sanction or measure has been imposed on a natural person and publication of that person’s…
− 2. Where Member States permit the publication of administrative sanctions or other administrative measures imposed in accordance with Article 18 against which there has been an appeal, competent authorities shall also publish on their official website information on the appeal status and on the outc…
+ **4.** Competent authorities shall ensure that information published pursuant to this Article remains on their official website for at least five years. Personal data may only be retained on the official website of the competent authority where permitted by the applicable data protection rules.
− 3. Competent authorities shall publish the administrative sanctions or other administrative measures imposed in accordance with Article 18 on an anonymous basis in any of the following circumstances:
− 
− | (a) | the sanction or measure has been imposed on a natural person and publication of that person’s personal data is found to be disproportionate; |
− | --- | --- |
+ ### Article 21 — Reporting sanctions to EBA
− | (b) | the publication would jeopardise an ongoing criminal investigation or the stability of financial markets; |
− | --- | --- |
− 
− | (c) | the publication would cause disproportionate damage to the investment firms or natural persons involved. |
− | --- | --- |
− 
− 4. Competent authorities shall ensure that information published pursuant to this Article remains on their official website for at least five years. Personal data may only be retained on the official website of the competent authority where permitted by the applicable data protection rules.
− 
− ### art_21
− 
− Article 21
− 
− ### art_22
+ ### Article 22 — Reporting of breaches
− Article 22
+ **1.** Member States shall ensure that competent authorities establish effective and reliable mechanisms to enable prompt reporting of potential or actual breaches of national provisions transposing this Directive and of Regulation (EU) 2019/2033 to competent authorities.
− 1. Member States shall ensure that competent authorities establish effective and reliable mechanisms to enable prompt reporting of potential or actual breaches of national provisions transposing this Directive and of Regulation (EU) 2019/2033 to competent authorities.
+ (a) specific procedures for the reception, treatment and following up of such reports, including the establishment of secure communication channels;
− | (a) | specific procedures for the reception, treatment and following up of such reports, including the establishment of secure communication channels; |
− | --- | --- |
+ (b) appropriate protection against retaliation, discrimination or other types of unfair treatment by the investment firm for employees of investment firms who report breaches committed within the investment firm;
− | (b) | appropriate protection against retaliation, discrimination or other types of unfair treatment by the investment firm for employees of investment firms who report breaches committed within the investment firm; |
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