On 6 December 2023, the European Commission published a Delegated Regulation supplementing the Capital Requirements Regulation (CRR) with regard to regulatory technical standards (RTS) specifying in which circumstances the conditions for identifying groups of connected clients are met.

The Delegated Regulation:

  • Specifies the criteria for identifying two or more natural or legal persons who are so closely linked by idiosyncratic risk factors, that it is prudent to treat them as a single risk.
  • Partially repeal and replace the European Banking Authority guidelines on connected clients under Article 4(1)(39) of the CRR.
  • Set out the provisions for assessing situations where control and economic dependencies co-exist within one group of connected clients in such a way that all relevant natural and/or legal persons constitute a single risk. This happens when a group of connected clients is first established on the basis of a control relationship, and successively enlarged by another natural and/or legal person or a second group of connected clients because of some form of economic dependency.

The Delegated Regulation enters into force on the twentieth day following its publication in the Official Journal of the EU.