What changed between the plenary report and the adopted text

Removed:The asset threshold referred to in the first subparagraph shall not include the assets held by the third country branch in connection with central bank market operations entered into with ESCB central banks.

Removed:2. Competent authorities shall assess whether ▌third country branches ▌have systemic importance and pose significant risks for the financial stability of the Union or for the Member States▌. For those purposes, competent authorities shall, in particular, have regard to the indicators of systemic importance referred to in Article 48j(4) and Article 131(3).

Removed:3. The assessment ▌ referred to in paragraph 2 ▌shall be performed by the competent authorities of the Member States where the relevant third country group has established third country branches and subsidiary institutions (the “competent authorities concerned”). The assessment shall be led by the competent authority of the Member State where the largest third country branch by asset size is established (the “lead competent authority”).

Removed:▌

Removed:The ▌“lead competent authority” ▌shall conduct the assessment in full cooperation with all the competent authorities concerned. The competent authorities concerned shall assist and provide all the necessary documentation to the lead competent authority. ▌The lead competent authority ▌shall hear the third country group and shall set reasonable timeframes for the third country group to submit documentation and make its views known in writing.

Removed:4. The lead competent authority shall transmit a draft assessment of the matters referred to in paragraph 2 to the competent authorities concerned by no later than six months from the starting date of the annual reporting period immediately following the last reporting period that triggered the obligation to conduct the assessment in accordance with paragraph 1. The assessment shall be performed every two years thereafter.

Removed:Where appropriate to address the risks identifiedin the draft assessment, the lead competent authority may recommend that the third country branches be subject to targeted requirements that may include:

Removed:(a) the obligation to restructure their assets or activities in the Union in such a manner that they cease to qualify as systemic in accordance with paragraph 2 of this Article or that they cease to pose an undue risk to the financial stability of the Union; or

Removed:(b) additional prudential requirements in accordance with Article 48p.

Removed:▌

Removed:5.▌ The lead competent authority and the competent authorities concerned shall do their best endeavours to reach a joint decision by consensus on the draft report and, where applicable, on the targeted requirements referred to in paragraph 4 by no later than three months from the date on which the draft report was transmitted from the former to the latter.

Removed:In the absence of a joint decision after the end of the three-month period referred to in the first subparagraph, any competent authority concerned may refer the matter to the EBA for mediation in accordance with Article 19 of Regulation (EU) No 1093/2010. EBA shall take its decision within one month of the referral and the competent authorities concerned shall adopt the joint decision referred to in the first subparagraph in conformity with the decision of EBA.

Removed:▌

Removed:6. The third country branches shall have a period of three months from the date of the decision’s entering into force in accordance with paragraphs 5 or 6 to comply with the requirements laid down in that decision.

Removed:Where the third country branches are required to apply for authorisation as institutions in accordance with Title III, Chapter 1, their authorisation under this Title shall remain valid on an interim basis until the expiry of the deadline referred to in the first subparagraph of this paragraph is reached or, as the case may be, until the completion of the authorisation process as institutions. The third country branches may request the competent authority to extend the three-month deadline referred to in the first subparagraph where they can justify the need for such an extended deadline to comply with the relevant requirement imposed on them.

Removed:Where the threshold referred to in paragraph 1 is met by aggregation of assets of various branches, the competent authorities may impose the requirement referred to in this subparagraph in decreasing asset size order up to the point in which the total assets remaining on the books of the third country branches in the Union is less than EUR 30 billion.

Removed:7. EBA shall develop draft regulatory technical standards to specify the rules of construction for the interpretation of Article 111 of this Directive for the purposes of determining the hypothetical consolidated supervisor as referred to in paragraph 3, point (b), of this Article.

Removed:EBA shall submit those draft regulatory technical standards to the Commission by [OP please insert the date = 12 months from the date of entry into force of this amending Directive].

Removed:Power is delegated to the Commission to adopt the regulatory technical standards referred to in the first subparagraph in accordance with Articles 10 to 14 of Regulation (EU) No 1093/2010.

Removed:Sub-section 4 Reporting requirements

Removed:1. Member States shall require third country branches to periodically report to their competent authorities information on:

Removed:(a) the assets and liabilities held on their books in accordance with Article 48i or originated by the third country branch, with a breakdown that singles out:

Removed:(i) the largest recorded assets and liabilities classified by sector and counterparty type (including, in particular, financial sector exposures);

Removed:(ii) significant exposure and funding source concentrations to specified types of counterparties;

Removed:(iii) significant internal transactions with the head undertaking and with members of the head undertaking’s group;

Removed:(b) the third country branch’s compliance with the requirements that apply to them under this Directive;

Removed:(c) on an ad hoc basis, the deposit protection arrangements available to depositors in the third country branch in accordance with Article 15(2) and (3) of Directive 2014/49;

Removed:(d) additional regulatory requirements imposed on the third country branch by Member States under national law.

Removed:For the purposes of reporting the information on the assets and liabilities held on their books in accordance with point (a), third country branches shall apply the international accounting standards adopted in accordance with the procedure laid down in Article 6(2) of Regulation (EC) No 1606/2002*10 or the applicable GAAP in the Member State.

Removed:2. Member States shall require third country branches to report to their competent authorities the following information on their head undertaking:

Removed:(a) on a periodic basis, aggregated information on the assets and liabilities held or booked, respectively, by the subsidiaries and other third country branches of that head undertaking’s group in the Union;

Removed:(b) on a periodic basis, the head undertaking’s compliance with its applicable prudential requirements on an individual and consolidated basis;

Removed:(c) on an ad hoc basis, significant supervisory reviews and assessments when those are conducted on the head undertaking and the consequent supervisory decisions;

Removed:(d) the recovery plans of the head undertaking and the specific measures that could be taken on the third country branch in accordance with those plans, and any subsequent updates and amendments to those plans;

Removed:(e) the head undertaking’s business strategy in relation to the third country branch, and any subsequent changes to that strategy;

Removed:(f) the services provided by the head undertaking to eligible counterparties or professional clients within the meaning of Section 1 of Annex II to Directive 2014/65/EU established or situated in the Union on the basis of reverse solicitation of services in accordance with Article 21c of this Directive;

Removed:(fa) the cross-border investment services directly provided in the Union by the head undertaking and by the subsidiaries of the head undertaking established in a third country, and the investment services that are provided in the Union by the head undertaking established in a third country on the basis of reverse solicitation.

Removed:3. The reporting obligations laid down in this Article shall not prevent competent authorities from imposing additional ad hoc reporting requirements on third country branches where the competent authority deems the additional information necessary to gain a comprehensive view of the branch’s or its head undertaking’s business, activities or financial soundness, verify the branch’s and its head undertaking’s compliance with applicable laws and ensure the branch’s compliance with those laws.

Removed:3a. The competent authorities of third country branches shall share with the competent authorities of the Union subsidiaries of the same third country groups the information obtained in accordance with Article 48l(1) and (2).

Removed:_______

Removed:*10 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).’

Removed:1. EBA shall develop draft implementing technical standards to specify the uniform formats, definitions, the IT solutions and the frequency of reporting to be applied for the purposes of Article 48l.

Removed:The reporting requirements referred to in the first subparagraph shall be proportionate to the classification of third country branches as either class 1 or class 2.

Removed:EBA shall submit those draft implementing technical standards to the Commission by [OP please insert the date = 6 months from the date of entry into force of this amending Directive].

Removed:Power is conferred on the Commission to adopt the implementing technical standards referred to in the first subparagraph in accordance with Article 15 of Regulation (EU) No 1093/2010.

Removed:2. The regulatory and financial information referred to in this Article shall be reported at least biannually by class 1 third country branches and at least annually by class 2 third country branches.

Removed:3. Competent authorities may waive all or part of the requirements to report information on the head undertaking laid out in paragraph 48l(3) for qualifying third country branches, provided that the competent authority is able to obtain the relevant information directly from the supervisory authorities of the relevant third country.

Removed:Supervision

Removed:1. Member States shall require that competent authorities comply with this Section and, mutatis mutandis, with Title VII for the purposes of supervising third country branches.

Removed:2. Competent authorities shall include third country branches in the supervisory examination programme referred to in Article 99.

Removed:1. Member States shall require that competent authorities review the arrangements, strategies, processes and mechanisms implemented by third country branches to comply with the provisions that apply to them under this Directive and, where applicable, any additional regulatory requirements under national law.

Removed:2. On the basis of the review conducted in accordance with paragraph 1, the competent authorities shall evaluate whether the arrangements, strategies, processes and mechanisms implemented by the third country branches and the capital endowment and liquidity held by them ensure a sound management and coverage of their material risks and the viability of the branch.

Removed:3. Competent authorities shall conduct the review and evaluation referred to in paragraphs 1 and 2 in accordance with the principle of proportionality, as published in accordance with Article 143(1), point (c). In particular, competent authorities shall establish a frequency and intensity for the review referred to in paragraph 1 that is proportionate to the classification as class 1 and 2 third country branches and that takes into account other relevant criteria, such as the nature, scale and complexity of the third country branches’ activities.

Removed:4. Where a review, in particular the evaluation of the governance arrangements, the business model, or the activities of a third country branch, gives competent authorities reasonable grounds to suspect that, in connection with that third country branch, money laundering or terrorist financing is being or has been committed or attempted, or there is increased risk thereof, the competent authority shall immediately notify EBA and the authority that supervises the third country branch in accordance with Directive (EU) 2015/849. Where there is an increased risk of money laundering or terrorist financing, the competent authority and the authority that supervises the third country branch in accordance with Directive (EU) 2015/849 shall liaise and notify their common assessment immediately to EBA. The competent authority shall take, as appropriate, measures in accordance with this Directive, which may include withdrawing the third country branch’s permission in accordance with Article 48d(2), point (g).

Removed:5. Competent authorities, financial intelligence units and authorities that supervise third country branches shall cooperate closely with each other within their respective competences and shall exchange information relevant to this Directive, provided that such cooperation and information exchange do not impinge on an on-going inquiry, investigation or proceedings in accordance with the criminal or administrative law of the Member State where the competent authority, financial intelligence unit or authority entrusted with the public duty of supervising third country branches are located. EBA may assist the competent authorities and the authorities in charge of supervising the third country branch in accordance with Directive (EU) 2015/849 in the event of a disagreement concerning the coordination of supervisory activities under this Article on its own initiative. In such an event, EBA shall act in accordance with Article 19(1), second subparagraph, of Regulation (EU) No 1093/2010.

Removed:6. EBA shall develop draft regulatory technical standards to further specify ▌the common procedures and methodologies for the supervisory review and evaluation process referred to in this Article and for the assessment of the treatment of material risks.

Removed:▌

Removed:For the purposes of point (a), the procedures and methodologies referred to therein shall be laid down in a manner that is proportionate to the classification of the third country branches as class 1 or class 2, and to other appropriate criteria such as the nature, scale and complexity of their activities.

Removed:EBA shall submit those draft regulatory technical standards to the Commission by [OP please insert the date = 12 months from the date of entry into force of this amending Directive].

Removed:Power is delegated to the Commission to adopt the regulatory technical standards referred to in the first subparagraph in accordance with Articles 10 to 14 of Regulation (EU) No 1093/2010.