CELEX: 51983PC0025
Language: en
Date: 1983-01-27
Title: Amended proposal for a COUNCIL DIRECTIVE on the supervision of credit institutions on a consolidated basis (submitted to the Council by the Commission pursuant to the second paragraph of Article 149 of the EEC Treaty)

ARCHIVES HISTORIQUES
DE LA COMMISSION
COLLECTION RELIEE DES
DOCUMENTS "COM"
COM (83) 025
Vol. 1983/0012
 ---pagebreak--- Disclaimer
Conformément au règlement (CEE, Euratom) n° 354/83 du Conseil du 1er février 1983
concernant l'ouverture au public des archives historiques de la Communauté économique
européenne et de la Communauté européenne de l'énergie atomique (JO L 43 du 15.2.1983,
p. 1), tel que modifié par le règlement (CE, Euratom) n° 1700/2003 du 22 septembre 2003
(JO L 243 du 27.9.2003, p. 1), ce dossier est ouvert au public. Le cas échéant, les documents
classifiés présents dans ce dossier ont été déclassifiés conformément à l'article 5 dudit
règlement.
In accordance with Council Regulation (EEC, Euratom) No 354/83 of 1 February 1983
concerning the opening to the public of the historical archives of the European Economic
Community and the European Atomic Energy Community (OJ L 43, 15.2.1983, p. 1), as
amended by Regulation (EC, Euratom) No 1700/2003 of 22 September 2003 (OJ L 243,
27.9.2003, p. 1), this file is open to the public. Where necessary, classified documents in this
file have been declassified in conformity with Article 5 of the aforementioned regulation.
In Übereinstimmung mit der Verordnung (EWG, Euratom) Nr. 354/83 des Rates vom 1.
Februar 1983 über die Freigabe der historischen Archive der Europäischen
Wirtschaftsgemeinschaft und der Europäischen Atomgemeinschaft (ABI. L 43 vom 15.2.1983,
S. 1), geändert durch die Verordnung (EG, Euratom) Nr. 1700/2003 vom 22. September 2003
(ABI. L 243 vom 27.9.2003, S. 1), ist diese Datei der Öffentlichkeit zugänglich. Soweit
erforderlich, wurden die Verschlusssachen in dieser Datei in Übereinstimmung mit Artikel 5
der genannten Verordnung freigegeben.
 ---pagebreak--- COMMISSION OF THE EUROPEAN COMMUNITIES
                                                                      C0MC83) 25 final
                                                                      B r u s sel s, 27 J a n u a r y 1983
                                      A m en ded pr o p o s a l for a
                                           CO U N C I L D I R E C T I V E
    on the s u p e r v i s i o n of cr edit i n s t i t u t i o n s on a c o n s o l i d a t e d basis
                     (submitted to the Council by the C o m m iss io n
                       pu r s u a n t to the s e co nd p a r a g r a p h of A r ti cle
                      149 of the EEC Treaty)
  C0M(83) 25 final
 ---pagebreak---                                                           C@M t§
             Original Proposal                     New Version
  THE COUNCIL OF THE EUROPEAN            unchanged
  COMMUNITIES,
  Having regard to the Treaty establis- unchanged
  hing the European Economic Community
  and in particular Article 57 thereof,
  Having regard to the proposal from    unchanged
  the Commission,
  Having regard to the opinion of the   unchanged
 European Parliament,
 Having regard to the opinion of the    unchanged
 Economic and Social Committee,
 Whereas the First Council Directive    unchanged
 77/780/EEC of 12 December 1977 on
 the coordination of laws, regulations
 and administrative provisions rela­
 ting to the taking up and pursuit
 of the business of credit institu­
 tions^    states that, in order to
make it easier to take up and pursue
 the business of credit institutions,
 it is necessary to eliminate the
most obstructive differences between
the laws of the Member States as
regards the rules to which these
institutions are subject;
(1) O.J. N° L 322, 17.12.1977, p 30
 ---pagebreak--- Whereas the eventual aim is to pro-     unchanged
vide for overall supervision of a
credit institution operating in
several Member States by the compe­
tent authorities in the Member State
where it has its head office, in
consultation as appropriate with the
competent authorities of the other
Member States concerned, in such a
way that distortions of competition
 are avoided between such credit
 institutions and the domestic credit
 institutions of their host countries;
 whereas to that end controls and
 supervisory practices applied to
 credit institutions operating within
 the Community must be broadly
 similar from one Member State to
 another ;
 Whereas this objective can only be      unchanged
 attained by stages; whereas the
 establishment of the principle of
 supervision on a consolidated basis
  is one such stage;
  Whereas supervision on a consolida-    unchanged
  ted basis should enable the super­
  visory authority of a parent credit
  institution to make a more considered
  judgment about the financial situa­
  tion of that credit institution;
  Whereas this Directive is concerned     unchanged
   solely with ownership, partial or
  complete, of one credit or financial
   institution by another credit
   institution;
 ---pagebreak--- Whereas the principle of supervision   unchanged
on a consolidated basis is broadly
accepted, whereas Member States will
therefore seek to conclude bilateral
agreements with non-meiriber countries
designed to ensure that credit
institutions in such countries with
holdings in the Community are subject
to equivalent supervision and that
credit institutions from the Commu­
nity with holdings outside the
Community are able to apply the
principles laid down in this Direc­
tive without the flow of information
being hindered;
Whereas,pending coordination of        Whereas, pending coordination of
consolidated accounts and prudential   consolidated accounts and prudential
returns it is not possible to imple­   returns it is not possible to imple­
ment consolidated supervision on a     ment consolidated supervision on a
consistent basis in all Member States; consistent basis in all Member States;
whereas this Directive represents      whereas this Directive represents
an interim measure designed to         an interim measure designed to
establish   the principle of super­    establish the principle of super­
vision on a consolidated basis and     vision on a consolidated basis and
to eliminate the obstacles which       to eliminate the obstacles which
have hitherto prevented Member         have hitherto prevented Member
States from implementing the prin­     States from implementing the prin­
ciple on a unilateral basis;           ciple on a unilateral basis for
                                       t r a n s a c t i o n s t h r o u g h o u t the Comm uni ty ;
Whereas, pending further coordina­     unchanged
tion the process of consolidation
is to be undertaken by Member States
according to their national
procedures ;
 ---pagebreak--- Whereas the provisions of this         unchanged
Directive do not preclude supervision
of individual credit institutions
by the competent authorities of the
host Member State;
Whereas although financial institu-   unchanged
tions as defined hereinafter are not
subject to either Directive
77/780/EEC or this Directive their
inclusion in the consolidation
procedure is necessary in order to
ensure complete consolidation of all
the appropriate activities within a
group;
Whereas this Directive does not        Whereas this Directive does not
contain any provisions concerning      contain any provisions concerning
the rights of the supervisory autho­   the rights of the supervisory autho­
rities of a parent company to inspect  rities of a parent company to inspect
credit institutions in which the       credit institutions in which the
parent company has a participation,    parent company has a participation,
which are situated in another Member   which are situated in another Member
State; the Member States will pre­     State; the Member States will pre­
sume that they can obtain such         sume that they can obtain such
rights by way of bilateral agree­      rights by way of bilateral agree­
ments; whereas as a transitional       ments; whereas as a transitional
measure supervisory authorities will   measure supervisory authorities will
be able to appoint auditors to         be able to appoint an auditor or
verify information received from       expert to verify information
credit institutions in another         received from credit institutions
Member State,                          in another Member State;
 ---pagebreak---  HAS ADOPTED THIS DIRECTIVE
              Article 1
            Definitions
 For the purposes of this Directive :
 - "credit institution" means, in      unchanged
    accordance with the first indent
    of Article 1 of Directive
    77/780/EEC, an undertaking whose
   business is to receive deposits
   or other repayable funds from the
   public and to grant credits for
   its own account;
 - "financial institution" means an   unchanged
   undertaking, not being a credit
   institution, whose principal acti­
   vity is to grant credit facilities
   (including guarantees), to acquire
   participations or to make
   investments ;
- "participation" means the owner­    - "participation" means the owner­
   ship by a credit institution,         ship by a credit institution,
  whether directly or indirectly,       whether directly or indirectly,
  of 2 0 % o r more of the capital of   of 25 % or more of the capital of
   another credit or financial insti­    another credit or financial insti­
  tution;                               tution;
- "supervision" pending subsequent    unchanged
  coordination, means the techniques,
  in whatever form and however imple­
  mented , employed by the competent
  authorities in each Member State
  in order to monitor prudential
  aspects of a credit institution's
  business ;
 ---pagebreak---                                        - "competent authorities" means the
                                         national authorities which are
                                          empowered by law or regulation to
                                          supervise credit institutions.
              Article 2
                Scope
1.    Subject to Article 3 (1), this   unchanged
Directive shall apply to all credit
institutions.
2.    The institutions exempted from   unchanged
the provisions of Directive
77/780/EEC and listed in Article 2
thereof shall be exempted from the
provisions of this Directive.
3.    Member States may defer the       unchanged
application of this Directive to
certain institutions.    Such defer­
ment shall be on the terms set out
 in Article 2 (5) and (6) of
 Directive 77/780/EEC.
               Article 3
           General principles
 1.    Any credit institution which     unchanged
 holds a participation in another
 credit or financial institution shall
 be subject, to the extent and in the
 manner required by Article 4, to
 ---pagebreak--- supervision on the basis of the
consolidation of its financial situa­
tion with that of the institution
in which it holds such participation,
unless :
- the activities of the credit         - the activities of the credit
   institution holding the partici­       institution holding the partici­
  pation are at least 80 % consoli­      pation are at least 75 % consoli­
   dated with another credit institu­    dated with another credit institu­
   tion which is subject to super­        tion which is subject to super­
   vision on a consolidated basis by     vision on a consolidated basis by
   the competent authorities of one       the competent authorities of one
   of the Member States and the credit    of the Member States and the credit
   institution in which the partici­      institution in which the partici­
   pation is held is, without preju­      pation is held is, without preju­
   dice to the following indents,         dice to the following indents,
   included in this supervision on a      included in this supervision on a
   consolidated basis; or                 consolidated basis; or
- the credit or financial institu­     unchanged
   tion in which the participation is
   held is situated in a non-member
   country where there are legal impe­
   diments to the transfer of the
   necessary information; or
- the participation represents less    - the participation represents less
   than 2 % of the capital and            than 2 % of the capital and
   reserves of the credit institution     reserves of the credit institution
   which holds the participation or       which holds the participation or
   less than 500 000 ECU whichever is     less than 1 million ECU whichever
   the lesser amount; or                  is the lesser amount; or
 - the nature of the business of the    - the nature of the business of the
   credit or financial institution        credit or financial institution
    in which the participation is held     in which the participation is held
 ---pagebreak---   is such that, in the opinion of          is such that, in the opinion of
  the competent authorities for the        the competent authorities for the
  credit institution which holds the       credit institution which holds the
  participation, consolidation would       participation, af te r c o n s u l t a t i o n
  be inappropriate or misleading.           wi th th e said credit in s t i t u t i o n ,
                                            consolidation would be inappropri­
                                            ate or misleading.
2.    Pending subsequent coordination,   unchanged
and except as otherwise provided in
this Directive the process of conso­
lidation shall be undertaken accor­
ding to the national procedures
applicable to the credit institution
which holds the participation.
3.    Supervision on a consolidated      unchanged
basis shall be exercised by the
competent authorities of the country
in which the credit institution
which holds the participation has its
head office.
 4.    Such supervision shall take        unchanged
 place at least once a year and shall
 be without prejudice to supervision
 on an unconsolidated basis and
 without prejudice to supervision
 carried out by the competent autho­
 rities in other Member States.
              Article 4
    Form and extent of consolidation
  1.    Where a credit institution holds   unchanged
  a participation of more than 50 %
 ---pagebreak---   in another credit or financial insti­
  tution, the conpetent authorities
  for that credit institution shall
  require either full or pro rata
  consolidation of the institutions
  concerned.
  2.   Where a credit institution holds  unchanged
  a participation of 50 % or less in
  another credit or financial institu­
  tion and, in the opinion of the
  competent authorities for that
  credit institution, a situation of
  effective constrol exists, it shall
  be a matter for the discretion of
  those conpetent authorities how con­
  solidation should be effected.
  Pending further coordination, however,
  the conpetent authorities in the
  Member State in which the credit
  institution has its head office and
  the conpetent authorities for the
  credit or financial institution in
  which the participation is held may
  agree that consolidation of such a
  holding is not required in given
  cases.
  3.   Where a credit institution holds  unchanged
  a participation of 50 % or less in
i another credit or financial institu­
  tion and a situation of effective
  control does not exist, it shall be
  a matter for the discretion of the
  competent authorities for that
  credit institution whether and how
  consolidation is to be effected.
 ---pagebreak---              Article 5
       Facilitating measures
1.   Member States shall ensure that  unchanged
there are no legal impediments such
as to prevent any credit or finan­
cial institution supplying to a
credit institution which has a parti­
cipation therein information which
is necessary for supervision on a
consolidated basis to be effected
in accordance with this Directive.
2.    Member States shall permit the  unchanged
exchange between their competent
authorities of the information
necessary for supervision on a con­
solidated basis to be effected in
accordance with this Directive, it
being understood that, in the case
of financial institutions, the
collection of information shall in no
way imply a supervisory function
over such financial institutions by
 those competent authorities.
 3.   Any exchange of information      unchanged
 between competent authorities pro­
 vided for in this Directive shall
 be subject to the obligation of
 professional secrecy as set out in
 Article 12 of Directive 77/780/EEC
 and any such information shall be
 used exclusively for the purposes
 of supervision on a consolidated
 basis as required by this Directive.
 ---pagebreak--- 4.    If, in applying the provisions 4.     If in applying the provisions
of this Directive to a credit insti­ of this Directive to a credit insti­
tution, the competent authorities    tution, the coupetent authorities
in one Member State wish to verify   in one Member State wish to verify
the information received from a      the information received from a
credit or financial institution in   credit or financial institution in
another Member State they may        another Member State they may
appoint an auditor, approved for     appoint an auditor, or an expert,
this purpose by the competent autho­ approved for this purpose by the
rities of the other Member State     conpetent authorities of the other
concerned, to undertake such         Member State concerned, to undertake
verification.                        such verification.
              Article 6
         Non-member countries
1.   The application of the princi-  unchanged
pie of supervision on a consolidated
basis to Community credit institu­
tions, the parent institutions of
which have their head offices in
non-member countries, and to credit
institutions situated outside the
Community whose parent institutions
are situated within the Community
shall be a matter for bilateral
arrangements, on the basis of reci­
procity, between the competent
authorities of the Member States and
the non-member countries concerned.
Such arrangements shall seek to
ensure that Member States' competent
authorities are able to obtain the
necessary information to enable a
 ---pagebreak--- credit institution within the Com­
munity, with participations in
credit or financial institutions
outside the Community, to be super­
vised on a consolidated basis, and
that supervisory authorities in
non-member     countries are able to
obtain the information necessary
to supervise parent institutions
having head offices within their
territory which have participations
in credit institutions in one or
more Member States.
2.     Hie Commission and the Advisory unchanged
Committee set up under Article 11
of Directive 77/780/EEC shall be
kept informed of such steps as may
be taken in this context and the
Commission shall undertake the
coordination of the arrangements
referred to in paragraph 1.
          Final provisions
            Article 7
1.     Member States shall bring into  unchanged
force the measures necessary to
comply with this Directive not later
t h a n .... and shall forthwith
inform the Commission thereof.
2.     The Member States shall commu­  unchanged
nicate to the Commission the texts
of the main laws, regulations and
 ---pagebreak---                                         t
administrative provisions which they
adopt in the field covered by
this Directive.
          Article 8
This Directive is addressed to the   unchanged
Member States.