The European Banking Authority (EBA) has published the final peer review Report on the Regulatory Technical Standards (RTS) on the information to be notified when exercising the right of establishment and the freedom to provide services for credit institutions (the Peer Review).
Under the Fourth Capital Requirements Directive (2013/36/EU) (CRD), credit institutions are mandated to submit required information to their home Competent Authorities before exercising their free movement rights. The information that institutions are required to provide to their home competent authority varies between Member States. The Peer Review looks at all the notifications included in articles 35 – 39 CRD, and provided by credit institutions from 1 July 2016 to 30 June 2017. It assesses competent authorities’ practices on how they manage the passporting process and the cooperation arrangements between home and host competent authorities.
The peer review shows that Competent Authorities have developed consistent and robust procedures to comply with the RTS requirements. However, the level of sophistication of these processes varies among competent authorities. The area where the Review Panel saw inconsistencies in practices concerns the cooperation between Competent Authorities when dealing with branch or services passport notifications, particularly the timing of the exchange of information and granularity of such information.
In their analysis and recommendations of the responses to the review, the EBA suggests for greater co-operation and information sharing in case of passport notifications – particularly in advance of post-Brexit relationships. It is considered that, particularly in the case of complex notifications, early cross-border Competent Authority engagement will be mutually beneficial.