Commission Delegated Regulation (EU) 2017/586Show full title

Commission Delegated Regulation (EU) 2017/586

of 14 July 2016

supplementing Directive 2014/65/EU of the European Parliament and of the Council with regard to regulatory technical standards for the exchange of information between competent authorities when cooperating in supervisory activities, on-the-spot verifications and investigations

(Text with EEA relevance)

THE EUROPEAN COMMISSION,

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

Having regard to Directive 2014/65/EU of the European Parliament and of the Council of 15 May 2014 on markets in financial instrument amending Directive 2002/92/EC and Directive 2011/61/EU(1), and in particular, the third subparagraph of Article 80(3),

Whereas:

(1) The information to be exchanged in accordance with Directive 2014/65/EU should be of a sufficient scope and nature to allow competent authorities to discharge their supervisory duties and functions effectively. Consequently, it is necessary for competent authorities to be able to exchange information that enables them to supervise the conduct of natural and legal persons in their respective jurisdictions.

(2) In order for competent authorities to be able to effectively monitor investment firms, market operators and data service providers, it is important for them to exchange relevant information on: general background information and constituting documents (including national incorporation documents, or other documents that provide an insight into the structure and operational activities of an entity); information relating to the authorisation process; information relating to the management bodies of investment firms, including for example information that can verify the suitability of members of the management body such as their work experience (including their curriculum vitae stating relevant education and training, previous professional experience and professional activities or other related functions currently required for the purposes of Directive 2014/65/EU); information on their reputation; information on shareholders and members with qualified holdings such as background corporate information and reputation; information on a firm's authorisation including information on those firms granted or refused authorisation; information on the organisation requirements of regulated markets; information on the authorisation of data service providers; information on waivers granted or refused to categorise clients as ‘professional’; information on sanctions and enforcement action; information on operational activities and relevant conduct and compliance history.

(3) It is important to enable competent authorities to also exchange relevant information for the effective monitoring of credit institutions where they provide investment services or perform investment activities.

(4) In order to discharge their supervisory duties in a comprehensive manner, it is also important that competent authorities be able to exchange relevant information they may hold, including information on investment firms, market operators, data service reporting providers, credit institutions, financial counterparties, members or participants of regulated markets, multilateral trading facilities or persons exempt under Article 2 or 3 of Directive 2014/65/EU. In addition, competent authorities should be able to exchange relevant background information on persons who provide investment services without the required authorisation under Directive 2014/65/EU.

(5) For reasons of consistency and in order to ensure the smooth functioning of the financial markets, it is necessary that the provisions laid down in this Regulation and the related national provisions transposing Directive 2014/65/EU apply from the same date.

(6) This Regulation is based on the draft regulatory technical standards submitted by European Securities and Markets Authority (ESMA) to the Commission.

(7) ESMA has requested the opinion of the Securities and Markets Stakeholder Group established in accordance with Article 37 of Regulation (EU) No 1095/2010 of the European Parliament and of the Council(2).

(8) ESMA did not conduct public consultations on these draft regulatory technical standards as these relate to the exchange of information between competent authorities when cooperating in supervisory activities, on-the-spot verifications and investigations and this was considered disproportionate in relation to the scope and impact,

HAS ADOPTED THIS REGULATION:

Modifications etc. (not altering text)

C1 The “appropriate regulator” has power to make such provision as they consider appropriate by means of an instrument in writing to prevent, remedy or mitigate any failure of the provisions of this Regulation to operate effectively or any other deficiency arising from the withdrawal of the United Kingdom from the EU, see The Financial Regulators' Powers (Technical Standards etc.) (Amendment etc.) (EU Exit) Regulations 2018 (S.I. 2018/1115), regs. 2, 3, Sch. para. 37 (with saving on lP completion day by S.I. 2019/680, regs. 1(2), 11; 2020 c. 1, Sch. 5 para. 1(1))

C2 Regulation: power to modify conferred (11.7.2023) by Financial Services and Markets Act 2023 (c. 29), ss. 3, 86(3), Sch. 1 Pt. 3; S.I. 2023/779, reg. 2(d)

(1)

OJ L 173, 12.6.2014, p. 349.

(2)

Regulation (EU) No 1095/2010 of the European Parliament and of the Council of 24 November 2010 establishing a European Supervisory Authority (European Securities and Markets Authority), amending Decision No 716/2009/EC and repealing Commission Decision 2009/77/EC (OJ L 331, 15.12.2010, p. 84).