# Commission Delegated Regulation (EU) No 524/2014Show full title

Commission Delegated Regulation (EU) No 524/2014 of 12 March 2014 supplementing Directive 2013/36/EU of the European Parliament            and of the Council with regard to regulatory technical standards specifying the information that competent authorities of            home and host Member States supply to one another (Text with EEA relevance)         

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# Commission Delegated Regulation (EU) No 524/2014                     

# of 12 March 2014

# supplementing Directive 2013/36/EU of the European Parliament and of the Council with regard to regulatory technical standards                        specifying the information that competent authorities of home and host Member States supply to one another                     

# (Text with EEA relevance)

THE EUROPEAN COMMISSION,

Having regard to the Treaty on the Functioning of the European Union,

Having regard to 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(1), and in particular Article 50(6) thereof,                        

Whereas:

(1)In order to ensure efficient cooperation between competent authorities of home and host Member States information exchange                              should be two-way, within the respective supervisory competences of those authorities. It is therefore necessary to specify                              which information concerning institutions, and where relevant, concerning the functioning of their branches, should be provided                              by the competent authorities of the home Member State to the competent authorities of the host Member State, as well as which                              information regarding branches needs to be provided by competent authorities of host Member States to the competent authorities                              of the home Member State.

(2)Exchange of information between competent authorities of home and host Member States should be seen in a wider context of                              supervision of cross-border banking groups and, were relevant, information could be provided at the consolidated level. In                              particular, if an institution has an ultimate parent undertaking in the Member State where it has its head office, and the                              competent authority concerned is also the consolidating supervisor, possibilities should be made available to provide information                              at the consolidated level rather than at the level of an institution operating through a branch. However, in this case the                              competent authority should notify competent authorities of host Member States that the information is provided at the consolidated                              level.

(3)Information exchange between competent authorities of home and host Member States is not limited to the types of information                              specified in Article 50 of Directive 2013/36/EU, and therefore to the types of information specified in this Regulation. In                              particular, Articles 35, 36, 39, 43 and 52 of Directive 2013/36/EU set out a separate provision for exchange of information                              regarding on-the-spot verification of branches, notifications of the exercise of the right of establishment and freedom to                              provide services, and measures, including precautionary ones, taken by competent authorities in relation to branches and their                              parent undertakings. This Regulation should therefore not specify exchange of information requirements in those areas.

(4)It is necessary to laid down requirements for the information to be exchanged between competent authorities of home and host                              Member States in order to harmonise regulatory and supervisory practices across the Union. This information should cover all                              the areas specified in Article 50 of Directive 2013/36/EU, namely management and ownership, including business lines such                              as those referred to in Article 317 of Regulation (EU) No 575/2013 of the European Parliament and of the Council(2), liquidity and findings pertaining to liquidity supervision, solvency, deposit guarantee, large exposures, systemic risk,                              administrative and accounting procedures, and internal control mechanisms. In order to facilitate the monitoring of institutions,                              the competent authorities of host and home Member States should keep each other informed about situations of non-compliance                              with national or Union law as well as about supervisory measures and sanctions imposed on institutions. Furthermore, additional                              information regarding leverage and preparation for emergency situations should be included into the scope of information to                              be exchanged between competent authorities of home and host Member States so that the latter are able to monitor institutions                              in an efficient way.

(5)Where a liquidity stress affects or is expected to affect an institution, the competent authorities of host Member States                              need to have a clear understanding of the situation in order to be able to take precautionary measures under the conditions                              set out in Article 43 of Directive 2013/36/EU. This Regulation should therefore provide clear rules on what types of information                              have to be exchanged between authorities when a liquidity stress occurs. It is also necessary to specify the information to                              be exchanged so that authorities should be prepared well in advance for emergency situations such as those referred to in                              Article 114(1) of Directive 2013/36/EU.

(6)Given the differences in the size, complexity and significance of branches operating in host Member States, it is important                              to apply the principle of proportionality in the exchange of information. To this end, a more extensive range of information                              should be exchanged between home and host competent authorities where the competent authorities in host Member States are                              responsible for branches identified as significant in accordance with Article 51 of Directive 2013/36/EU.

(7)To ensure that the relevant information is exchanged within reasonable limits while avoiding situations where the competent                              authorities of a home Member State are obliged to forward any information about an institution, regardless of its nature and                              importance, to all competent authorities of host Member States, in specific cases, only information that is relevant to a                              particular branch should be transmitted exclusively to the competent authorities in charge of supervising this branch. For                              similar purposes, in a number of specific areas, only information revealing situations of non-compliance should be exchanged                              between competent authorities of home and host Member States, meaning that no information should be exchanged where the institution                              is in conformity with national and Union law.

(8)This Regulation should also address exchange of information in relation to the carrying out of activities in a host Member                              State by way of the provision of cross-border services. Given the nature of cross-border services, competent authorities of                              host Member States are confronted with a lack of information regarding operations being conducted in their jurisdictions,                              and therefore it is essential to specify in detail what information needs to be exchanged for the purposes of safeguarding                              financial stability and monitoring conditions of authorisations, in particular monitoring whether the institution provides                              services in accordance with the notifications provided.This Regulation is based on the draft regulatory technical standards                              submitted by the European Supervisory Authority (European Banking Authority (EBA) to the Commission.

(9)EBA has conducted open public consultations on the draft regulatory technical standards on which this Regulation is based,                              analysed the potential related costs and benefits and requested the opinion of the Banking Stakeholder Group established in                              accordance with Article 37 of Regulation (EU) No 1093/2010 of the European Parliament and of the Council(3),

HAS ADOPTED THIS REGULATION:

## CHAPTER IU.K.**GENERAL PROVISIONS**

### Article 1U.K.Subject matter and scope

1.This Regulation specifies the information that the competent authorities of host and home Member States shall supply to one                        another in accordance with Article 50 of Directive 2013/36/EU.                  

2.It lays down rules on the information to be exchanged in relation to an institution which operates, through a branch or in                        the exercise of the freedom to provide services, in one or more Member States other than that in which its head office is                        situated.                  

### Article 2U.K.Information on a consolidated basis

Where the ultimate parent undertaking of an institution is set up in the same Member State as that in which the institution                     has its head office, and the competent authority of the institution's home Member State is also the consolidating supervisor,                     that competent authority shall, where appropriate in accordance with the requirements laid down in Regulation (EU) No 575/2013                     and Directive 2013/36/EU, provide information regarding this institution at the consolidated level and shall inform the competent                     authorities of host Member States that the information is provided at that level.                  

## CHAPTER IIU.K.**INFORMATION EXCHANGE REGARDING INSTITUTIONS OPERATING THROUGH A BRANCH**

### Article 3U.K.Information concerning management and ownership

1.The competent authorities of the home Member State shall provide to the competent authorities of a host Member State the organisational                        structure of an institution including its business lines and its relationships to entities within the group.                  

2.In addition to information specified in paragraph 1, the competent authorities of the home Member State shall provide to the                        competent authorities of a host Member State which supervise a significant branch, as referred to in Article 51 of Directive                        2013/36/EU, the following information in relation to an institution:                  

(a)the structure of the management body and senior management, including the allocation of responsibility for the oversight of                        a branch;                  

(b)the list of shareholders and members with qualifying holdings based on information provided by the credit institution in accordance                        with Article 26(1) of Directive 2013/36/EU.                  

### Article 4U.K.Information concerning liquidity and supervisory findings

1.The competent authorities of the home Member State shall provide to the competent authorities of a host Member State the following                        information:                  

(a)any material deficiencies in an institution's liquidity risk management which are known to the competent authorities and which                        may affect branches, any related supervisory measures which have been taken in relation to those deficiencies, and the extent                        of the institution's compliance with those supervisory measures;                  

(b)the overall assessment carried out by the competent authorities of the home Member State of an institution's liquidity risk                        profile and risk management, in particular in relation to a branch;                  

(c)an institution's ratios indicating its liquidity and stable funding position at the national or Union level in the domestic                        currency of the institution's home Member State and in all other currencies which are material for the institution;                  

(d)the components of an institution's liquidity buffer;                  

(e)the degree of asset encumbrance of an institution;                  

(f)the ratio of an institution's loans to its deposits;                  

(g)any domestic liquidity ratios that apply to an institution as a part of macro-prudential policy measures by the competent                        authorities or by the designated authority whether as binding requirements, guidelines, recommendations, warnings or otherwise,                        including the definitions of those ratios;                  

(h)any specific liquidity requirements applied in accordance with Article 105 of Directive 2013/36/EU;                  

(i)any obstacles to cash and collateral transfer to or from branches of an institution.                  

2.Where the competent authorities have waived in full or in part the application of Part Six of Regulation (EU) No 575/2013                        to an institution in accordance with Article 8 of that Regulation, the competent authorities of the home Member State shall                        provide the information referred to in paragraph 1 at the sub-consolidated level or, in accordance with Article 2 of this                        Regulation, at the consolidated level.                  

3.In addition to the information specified in paragraph 1, the competent authorities of the home Member State shall provide                        to the competent authorities of a host Member State which supervise a significant branch the following information:                  

(a)the liquidity and funding policy of the institution, including descriptions of the funding arrangements for its branches,                        any intra-group support arrangements, and procedures for centralised cash pooling;                  

(b)the liquidity and funding contingency plans of the institution, including information on the assumed stress scenarios.                  

### Article 5U.K.Information concerning solvency

1.The competent authorities of the home Member State shall inform the competent authorities of a host Member State whether an                        institution is compliant with the following requirements:                  

(a)the own fund requirements laid down in Article 92 of Regulation (EU) No 575/2013, taking into account any measures adopted                        or recognised in accordance with Article 458 of that Regulation and, where relevant, taking into account the transitional                        arrangements laid down in Part Ten of that Regulation;                  

(b)any additional own fund requirements imposed in accordance with Article 104 of Directive 2013/36/EU;                  

(c)the capital buffer requirements set out in Chapter 4 of Title VII of Directive 2013/36/EU.                  

2.In addition to the information specified in paragraph 1, the competent authorities of the home Member State shall provide                        to the competent authorities of a host Member State which supervise a significant branch of an institution which is subject                        to own funds requirements the following information:                  

(a)the institution's Common Equity Tier 1 capital ratio, within the meaning of Article 92(2)(a) of Regulation (EU) No 575/2013;                  

(b)the institution's Tier 1 capital ratio, within the meaning of Article 92(2)(b) of Regulation (EU) No 575/2013;                  

(c)the institution's total capital ratio, within the meaning of Article 92(2)(c) of Regulation (EU) No 575/2013;                  

(d)the institution's total risk exposure amount, within the meaning of Article 92(3) of Regulation (EU) No 575/2013;                  

(e)the own funds requirements applicable in the home Member State in accordance with Article 92 of Regulation (EU) No 575/2013,                        taking into account any measures adopted or recognised in accordance with Article 458 of that Regulation and, where relevant,                        taking into account the transitional arrangements laid down in Part Ten of that Regulation;                  

(f)the level of the capital conservation buffer that the institution is required to maintain in accordance with Article 129 of                        Directive 2013/36/EU;                  

(g)the level of any institution-specific countercyclical capital buffer that the institution is required to maintain in accordance                        with Article 130 of Directive 2013/36/EU;                  

(h)the level of any systemic risk buffer that the institution is required to maintain in accordance with Article 133 of Directive                        2013/36/EU;                  

(i)the level of any G-SII buffer or O-SII buffer that the institution is required to maintain in accordance with Article 131(4)                        and (5) of Directive 2013/36/EU;                  

(j)the level of any additional own funds requirements imposed in accordance with point (a) of Article 104(1) of Directive 2013/36/EU                        and of any other requirements imposed relating to the institution's solvency in accordance with that Article.                  

3.Where the application of the relevant provisions of Regulation (EU) No 575/2013 has been waived in accordance with Articles                        7, 10 or 15 of that Regulation, or the requirements set out in Articles 10 and 12 and Article 13(1) of Directive 2013/36/EU                        have been waived in accordance with Article 21 of that Directive 2013/36/EU, or an institution has received permission to                        apply the treatment referred to in Article 9(1) of Regulation (EU) No 575/2013, the competent authorities of the home Member                        State shall provide the information set out in paragraph 2 at the sub-consolidated level or, in accordance with Article 2                        of this Regulation, at the consolidated level.                  

### Article 6U.K.Information concerning deposit-guarantee schemes

1.The competent authorities of the home Member State shall inform the competent authorities of a host Member State of the name                        of the deposit-guarantee scheme to which an institution belongs in accordance with Article 3(1) of Directive 94/19/EC of the                        European Parliament and of the Council(4).                  

2.The competent authorities of the home Member State shall provide to the competent authorities of a host Member State the following                        information in relation to the deposit-guarantee scheme referred to in paragraph 1:                  

(a)the maximum coverage of the deposit-guarantee scheme per eligible depositor;                  

(b)the scope of coverage and the types of deposits covered;                  

(c)any exclusion from the coverage, including products and types of depositors;                  

(d)funding arrangements of the deposit guarantee scheme, in particular whether the scheme is funded *ex-ante* or *ex-post*, and the volume of the scheme;                  

(e)contact details of the administrator of the scheme.                  

3.The information set out in paragraph 2 shall only be provided to the competent authorities of a host Member State once in                        relation to each deposit-guarantee scheme concerned. Where there is a change in the information provided, the competent authorities                        of the home Member State shall provide updated information to competent authorities of a host Member State.                  

### Article 7U.K.Information concerning limitation of large exposures

The competent authorities of the home Member State shall provide information to the competent authorities of a host Member                     State regarding any situation in respect of which the competent authorities of the home Member State have determined that                     an institution has not complied with applicable large exposures limits and requirements laid down in Part Four of Regulation                     (EU) No 575/2013. The information to be provided shall explain the situation and the supervisory measures taken or planned                     to be taken.                  

### Article 8U.K.Information regarding systemic risk posed by institution

The competent authorities of the home Member State shall inform the competent authorities of a host Member State where an                     institution has been designated as a global systemically important institution (G-SII) or as another systemically important                     institution (O-SII) in accordance with Article 131(1) of Directive 2013/36/EU. Where the institution has been identified as                     a G-SII, the information provided shall include the sub-category to which it is allocated.                  

### Article 9U.K.Information concerning administrative and accounting procedures

1.The competent authorities of the home Member State shall provide information to the competent authorities of a host Member                        State regarding any situation where the competent authorities of the home Member State have determined that an institution                        has not complied with applicable accounting standards and procedures to which the institution is subject in accordance with                        Regulation (EC) No 1606/2002 of the European Parliament and of the Council(5). The information to be provided shall explain the situation and the supervisory measures taken or planned to be taken.                  

2.Where the information specified in paragraph 1 is relevant to a particular branch only, the competent authorities of the home                        Member State shall only provide the information to the competent authorities of the host Member State in which that branch                        is established.                  

### Article 10U.K.Information concerning internal control mechanisms

1.The competent authorities of the home Member State shall provide information to the competent authorities of a host Member                        State regarding any situation in respect of which the competent authorities of the home Member States have determined that                        an institution has not complied with requirements concerning internal control mechanisms, including risk management, risk                        control and internal audit arrangements pursuant to Regulation (EU) No 575/2013 and Directive 2013/36/EU. The information                        to be provided shall explain the situation and the supervisory measures taken or planned to be taken.                  

2.Where the information specified in paragraph 1 is relevant to a particular branch only, the competent authorities of the home                        Member State shall only provide the information to the competent authorities of the host Member State in which that branch                        is established.                  

### Article 11U.K.Information concerning leverage

1.The competent authorities of the home Member State shall provide information to the competent authorities of a host Member                        State regarding any situation in respect of which the competent authorities of the home Member States have determined that                        an institution has not complied with requirements concerning leverage ratios pursuant to Part Seven of Regulation (EU) No                        575/2013 and, where relevant, taking into account the transitional provisions in Article 499 of that Regulation. The information                        to be provided shall explain the situation and the supervisory measures taken or planned to be taken.                  

2.The competent authorities of the home Member State shall provide the competent authorities of a host Member State with all                        information disclosed by an institution in accordance with Article 451 of Regulation (EU) No 575/2013 regarding its leverage                        ratio and its management of the risk of excessive leverage.                  

### Article 12U.K.Information concerning general non-compliance

1.The competent authorities of the home Member State shall provide information to competent authorities of a host Member State                        regarding any situations in respect of which the competent authorities of the home Member State have determined that an institution                        has not complied with national or Union law or with requirements, in relation to the prudential supervision or market conduct                        supervision of institutions, including the requirements laid down in Regulation (EU) No 575/2013 and Directive 2013/36/EU,                        other than the requirements referred to in Articles 3 to 11 of this Regulation. The information to be provided shall explain                        the situation and the supervisory measures taken or planned to be taken.                  

2.Where the information specified in paragraph 1 is relevant to a particular branch only, the competent authorities of the home                        Member State shall only provide the information to the competent authorities of the host Member State in which that branch                        is established.                  

### Article 13U.K.Communication of supervisory measures and sanctions

1.The competent authorities of the home Member State shall inform the competent authorities of a host Member State of any of                        the following penalties or measures which have been imposed on or applied to an institution and which affect the operations                        of a branch:                  

(a)administrative penalties imposed or other administrative measures applied pursuant to Articles 64 to 67 of Directive 2013/36/EU;                  

(b)supervisory measures imposed pursuant to Articles 104 or 105 of Directive 2013/36/EU;                  

(c)criminal penalties imposed which relate to breaches of Regulation (EU) No 575/2013 or of the national provisions transposing                        Directive 2013/36/EU.                  

2.Where the information specified in paragraph 1 is relevant to a particular branch only, the competent authorities of the home                        Member State is only required to provide the information to the competent authorities of the host Member State in which that                        branch is established.                  

### Article 14U.K.Information regarding preparation for emergency situations

The competent authorities of the home Member State and the competent authorities of a host Member State shall exchange information                     regarding preparations for emergency situations. In particular they shall keep one another informed of the following:                  

the emergency contact details of persons within the competent authorities who are responsible for handling emergency situations;

the communication procedures that shall apply in emergency situations.

### Article 15U.K.Information from authorities of a host Member State

Without prejudice to the information exchange requirements following inspections of branches pursuant to Article 52(3) of                     Directive 2013/36/EU, the competent authorities of a host Member State shall provide the competent authorities of the home                     Member State with the following information:                  

a description of any situation in respect of which the competent authorities have determined that an institution has not complied                              with national or Union law or with requirements, in relation to the prudential supervision or market conduct supervision of                              institutions, including the requirements of Regulation (EU) No 575/2013 and of the national provisions transposing Directive                              2013/36/EU, together with an explanation of the supervisory measures taken or planned to be taken to address the non-compliance;                           

a description of any non-compliance with the conditions under which, in the interest of the general good, the activities of                              the branch shall be carried out in the host Member State;                           

any identification of systemic risk posed by the branch or its activities in the host Member State, including any assessment                              of the likely impact of a suspension or closure of the operations of the branch on the following:                           

systemic liquidity;

payment systems;

clearing and settlement systems;

the market share of the branch where it exceeds 2 % of the total market in the host Member State in either of the following                              categories:                           

deposits;

loans;

any obstacles to cash and collateral transfer to or from the branch.

## CHAPTER IIIU.K.**INFORMATION EXCHANGE REGARDING CROSS-BORDER SERVICE PROVIDERS**

### Article 16U.K.Information regarding cross-border service providers

Upon receiving a request for information from the competent authorities of a host Member State in relation to an institution                     carrying out its activities by way of the provision of services in that host Member State, the competent authorities of the                     home Member State shall provide the following information:                  

any situation in respect of which the competent authorities of the home Member State have determined that the institution                              has not complied with any national or Union law or with requirements, in relation to the prudential supervision or market                              conduct supervision of institutions, including the requirements of Regulation (EU) No 575/2013 and of the national provisions                              transposing Directive 2013/36/EU, together with an explanation of the supervisory measures taken or planned to be taken to                              address the non-compliance;                           

the volume of deposits taken from residents of the host Member State;

the volume of loans provided to the residents of the host Member State;

in relation to the activities listed in Annex I to Directive 2013/36/EU which the institution has notified its wish to carry                              out in the host Member State by way of provision of services:                           

the form in which the institution carries out the activities;

the activities which are the most significant in terms of the institution's activities in the host Member State;

the confirmation whether the activities identified as core business activities in the notification provided by the institution                                       pursuant to Article 39 of Directive 2013/36/EU are being performed by an institution.                                    

## CHAPTER IVU.K.**INFORMATION EXCHANGE REGARDING INSTITUTIONS OPERATING THROUGH A BRANCH IN CASE OF LIQUIDITY STRESS AFFECTING THE INSTITUTION                           OR THE BRANCH ITSELF**

### Article 17U.K.Scope of information exchange in liquidity stress

1.If the competent authorities of the home Member State consider that a liquidity stress has occurred, or is reasonably expected                        to occur, with respect to an institution they shall immediately notify the competent authorities of a host Member State and                        provide the information set out in paragraph 3.                  

2.If the competent authorities of a host Member State consider that a liquidity stress has occurred, or is reasonably expected                        to occur, with respect to a branch established in that Member State, they shall immediately notify the competent authorities                        of the home Member State and provide the information set out in paragraph 3.                  

3.The competent authorities shall provide the following information:                  

(a)a description of the situation that has occurred, including the underlying cause of the stress situation, the expected impact                        of the liquidity stress on the institution, and developments concerning intra-group transactions;                  

(b)an explanation of the measures that have been taken or are planned to be taken, whether by the competent authorities or by                        the institution, including any requirements imposed upon the institution by the competent authorities to mitigate the liquidity                        stress;                  

(c)the results of assessments of the systemic consequences of the liquidity stress;                  

(d)the latest available quantitative information regarding liquidity specified in points (c) to (h) of Article 4(1).                  

## CHAPTER VU.K.**FINAL PROVISIONS**

### Article 18U.K.Entry into force

This Regulation shall enter into force on the twentieth day following that of its publication in the *Official Journal of the European Union*.                  

This Regulation shall be binding in its entirety and directly applicable in all Member States.

Done at Brussels, 12 March 2014.

*For the Commission*                            

*The President*                            

José Manuel Barroso                            

1

OJ L 176, 27.6.2013, p. 338.                           

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 investment firms and amending Regulation (EU) No 648/2012 (OJ L 176, 27.6.2013, p. 1).                           

3

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).                           

4

Directive 94/19/EC of the European Parliament and of the Council of 30 May 1994 on deposit-guarantee schemes (OJ L 135, 31.5.1994, p. 5).                           

5

Regulation (EC) No 1606/2002 of the European Parliament and of the Council of 19 July 2002 on the application of international                              accounting standards (OJ L 243, 11.9.2002, p. 1).