62 Amendments of Sven GIEGOLD related to 2017/0358(COD)
Amendment 20 #
Proposal for a directive
Recital 18 a (new)
Recital 18 a (new)
(18a) The asset management sector has grown strongly in recent years in terms of assets under management. It has also experienced strong concentration as a small number of firms have become much larger than their competitors. This has increased the potential for systemic risk emanating from the activities of investment firms, e.g. the risks from liquidity mismatches between investment firms’ investment assets and the redemption terms granted to their customers. Recent work conducted by the Financial Stability Board and the International Organization of Securities Commissions is contributing to the understanding of those risks, but has not yet progressed enough to be translated into comprehensive macroprudential regulation and supervision. Where appropriate, this Directive integrates certain recommendations from this evolving body of work, but leaves the elaboration of a comprehensive framework to the mandatory review three years after the entering into force of this Directive.
Amendment 30 #
Proposal for a directive
Article 3 – paragraph 1 – point 20 a (new)
Article 3 – paragraph 1 – point 20 a (new)
(20a) ‘large asset manager’ is a group of individual undertakings belonging to a financial holding company, or as an investment holding company, or as a mixed financial holding company that together have over EUR 100 billion client assets under management, and that comprises at least one investment firm and any number of AIFMs as defined in Article 2(1) of Directive 2011/61/EU, or management companies as defined in Article 2(1b) of Directive 2009/65/EC;
Amendment 31 #
Proposal for a directive
Article 3 – paragraph 1 – point 20 b (new)
Article 3 – paragraph 1 – point 20 b (new)
(20b) ‘third country large asset manager’ is an intermediate EU parent undertaking subject to the requirements of Article 51(4);
Amendment 32 #
Proposal for a directive
Article 3 – paragraph 1 – point 20 c (new)
Article 3 – paragraph 1 – point 20 c (new)
(20c) ‘liquidity mismatch’ means the possible mismatch between the liquidity of a fund’s investment assets and the redemption terms for fund units. Under certain conditions, especially when securities markets are stressed and/or when many fund clients want to redeem their shares at the same time (redemption run scenario), such mismatches can cause financial instability and contagion as funds find it difficult to liquidate investment assets quickly in an already adverse market;
Amendment 54 #
Proposal for a directive
Title 4 – chapter 2 – section 1 a (new)
Title 4 – chapter 2 – section 1 a (new)
Amendment 56 #
Proposal for a directive
Article 23 – paragraph 2
Article 23 – paragraph 2
2. This Section, with the exception of Articles 25, 28(2) and Article 30, shall not apply where, on the basis of the assessment referred to in paragraph 1, an investment firm determines that it meets all of the conditions set out in Article 12(1) of [Regulation (EU) ---/---- [IFR].
Amendment 57 #
Proposal for a directive
Article 23 – paragraph 2 – subparagraph 1 (new)
Article 23 – paragraph 2 – subparagraph 1 (new)
By way of derogation from the first subparagraph, competent authorities may require an investment firm that meets all of the conditions set out in Article 12(1) of [Regulation (EU) ---/----[IFR] to apply totally or partially the requirements of this Section.
Amendment 59 #
Proposal for a directive
Article 23 – paragraph 5 – introductory part
Article 23 – paragraph 5 – introductory part
5. Competent authorities mayshall set a shorter period than the two years referred in paragraph 1 of this Article where both of the following conditions are met:
Amendment 61 #
Proposal for a directive
Article 24 – paragraph 4
Article 24 – paragraph 4
4. EBA, in consultation with ESMA, shall issue guidelinesdevelop draft regulatory technical standards to specify the content onf the application of the governance arrangements referred to in paragraph 1. EBA shall submit those draft regulatory technical standards to the Commission by [date of entry into force of this Directive]. 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.
Amendment 65 #
Proposal for a directive
Article 25 – paragraph 1 – introductory part
Article 25 – paragraph 1 – introductory part
1. Member States shall require investment firms to disclose by Member State and by third country in which the investment firm has aone or more establishments, including any affiliated undertakings, branches or a subsidiaryies that is aare financial institutions as defined in Article 4(1)(26) of Regulation (EU) No 575/2013, the following information on an annual basis:
Amendment 68 #
Proposal for a directive
Article 25 – paragraph 1 – point a
Article 25 – paragraph 1 – point a
(a) the name,a list of the names of their establishments, a brief description of the nature of their activities and location of any subsidiaries and branchess well as the country of tax registration;
Amendment 69 #
Proposal for a directive
Article 25 – paragraph 1 – point b
Article 25 – paragraph 1 – point b
(b) the turnoveramount of the net turnover arising in the jurisdiction, including separate disclosure of the turnover made with related and unrelated parties;
Amendment 70 #
Proposal for a directive
Article 25 – paragraph 1 – point d
Article 25 – paragraph 1 – point d
(d) the amount of profit or loss before income tax;
Amendment 71 #
Proposal for a directive
Article 25 – paragraph 1 – point e
Article 25 – paragraph 1 – point e
(e) the tax onamount of income tax accrued (current year) which is the current tax expense recognised on taxable profits or losses of the financial year by subsidiaries, branches, joint ventures, undertakings and establishments resident for tax purposes in the relevant tax jurisdiction;
Amendment 72 #
Proposal for a directive
Article 25 – paragraph 1 – point f a (new)
Article 25 – paragraph 1 – point f a (new)
(fa) the amount of income tax paid, which is the amount of income tax paid during the relevant financial year by subsidiaries, branches, joint ventures, undertakings and establishments resident for tax purposes in the relevant tax jurisdiction;
Amendment 73 #
Proposal for a directive
Article 25 – paragraph 1 – point f b (new)
Article 25 – paragraph 1 – point f b (new)
(fb) stated capital;
Amendment 74 #
Proposal for a directive
Article 25 – paragraph 1 – point f c (new)
Article 25 – paragraph 1 – point f c (new)
(fc) the amount of accumulated earnings at the end of the period;
Amendment 75 #
Proposal for a directive
Article 25 – paragraph 1 – point f d (new)
Article 25 – paragraph 1 – point f d (new)
(fd) fixed investment intangible plant, equipment, inventories and stocks and the annual cost of maintaining that tangible plant and equipment;
Amendment 76 #
Proposal for a directive
Article 25 – paragraph 1 – point f e (new)
Article 25 – paragraph 1 – point f e (new)
(fe) whether subsidiaries, branches, joint ventures, undertakings or establishments have benefited from a preferential tax treatment during the course of the period that might or does permit the payment of tax at a lower rate than that generally applied to profits arising in the jurisdiction and provide a description of the arrangement in question.
Amendment 77 #
Proposal for a directive
Article 25 – paragraph 1 a (new)
Article 25 – paragraph 1 a (new)
1a. For the purposes of point (e) of the first paragraph, the current tax expense shall relate only to the activities of an undertaking in the current financial year and shall only include those sums likely to fall due for payment within twelve months of the period end and shall exclude all deferred taxes.
Amendment 83 #
Proposal for a directive
Article 27 – title
Article 27 – title
Risk-to-customers, risk-to-market, risk-to- firm and liquidity mismatch risk
Amendment 84 #
Proposal for a directive
Article 27 – paragraph 1 a (new)
Article 27 – paragraph 1 a (new)
1a. Competent authorities shall ensure that large asset managers and third country large asset managers enforce effective strategies and processes to assess and manage on an ongoing basis the liquidity mismatch between investment assets and redemption terms for fund units in such a way as to be able to cope with extreme but plausible scenarios of market stress. In so doing they shall take into account the delegated acts adopted by the Commission in accordance with Article 22a.
Amendment 85 #
Proposal for a directive
Article 28 – paragraph 1 – introductory part
Article 28 – paragraph 1 – introductory part
1. Competent authorities shall ensure that investment firms, when establishing and applying their remuneration policies for senior management, risk takers, staff engaged in control functions and for any employee receiving overall remuneration equal to at least the lowest remuneration received by senior management or risk takers, and whose professional activities have a material impact on the risk profile of the investment firm or of the assets that it manages, comply with the following principles:
Amendment 89 #
Proposal for a directive
Article 28 – paragraph 1 – point d a (new)
Article 28 – paragraph 1 – point d a (new)
(da) the highest remuneration in the investment firm does not exceed 30 times the average remuneration of the lowest paid 5 percent of employees;
Amendment 91 #
Proposal for a directive
Article 28 – paragraph 1 – point d b (new)
Article 28 – paragraph 1 – point d b (new)
(db) a pay ratio of 1 to 20 between the average total remuneration and the highest total remuneration within the same investment firm is respected;
Amendment 95 #
Proposal for a directive
Article 28 – paragraph 2
Article 28 – paragraph 2
2. For the purposes of point (i) of paragraph 1, Member States shall ensure that investment firms set the appropriate ratios between the variable and the fixed component of the total remuneration in their remuneration policies, taking into account the business activities of the investment firm and associated risks, as well as the impact that different categories of individuals referred to in paragraph 1 have on the risk profile of the investment firm. , whereby the following principles shall apply: (i) the variable component shall not exceed 100% of the fixed component of the total remuneration for each individual. Member States may set a lower maximum percentage; (ii) Members States may allow shareholders or owners or members of the investment firm to approve a higher maximum level of the ratio between the fixed and variable components of remuneration provided the overall level of the variable component shall not exceed 200% of the fixed component of the total remuneration for each individual. Member States may set a lower maximum percentage. Any approval of a higher ratio in accordance with the first subparagraph of this point shall be carried out in accordance with the following procedure: – the shareholders or owners or members of the investment firm shall act upon a detailed recommendation by the investment firm giving the reasons for, and the scope of, an approval sought, including the number of staff affected, their functions and the expected impact on the requirement to maintain a sound capital base; – shareholders or owners or members of the investment firm shall act by a majority of at least 66% provided that at least 50% of the shares or equivalent ownership rights are represented or, failing that, shall act by a majority of 75% of the ownership rights represented; – the investment firm shall notify all shareholders or owners or members of the investment firm, providing a reasonable notice period in advance, that an approval under the first subparagraph of this point will be sought; – the investment firm shall, without delay, inform the competent authority of the recommendation to its shareholders or owners or members, including the proposed higher maximum ratio and the reasons therefore and shall be able to demonstrate to the competent authority that the proposed higher ratio does not conflict with the investment firm’s obligations under this Directive and under Regulation (EU)[IFR], having regard in particular to the investment firm’s own funds obligations; – the investment firm shall, without delay, inform the competent authority of the decisions taken by its shareholders or owners or members, including any approved higher maximum ratio pursuant to the first subparagraph of this point, and the competent authorities shall use the information received to benchmark the practices of investment firms in that regard. The competent authorities shall provide EBA with that information and EBA shall publish it on an aggregate home Member State basis in a common reporting format. EBA may elaborate guidelines to facilitate the implementation of this indent and to ensure the consistency of the information collected; – staff who are directly concerned by the higher maximum levels of variable remuneration referred to in this point shall not, where applicable, be allowed to exercise, directly or indirectly, any voting rights they may have as shareholders or owners or members of the investment firm; (iii) Member States may allow investment firms to apply the discount rate referred to in the second subparagraph of this point to a maximum of 25% of total variable remuneration provided it is paid in instruments that are deferred for a period of not less than five years. Member States may set a lower maximum percentage.
Amendment 113 #
Proposal for a directive
Article 30 – paragraph 1 – introductory part
Article 30 – paragraph 1 – introductory part
1. Member States shall ensure that any variable remuneration awarded and paid by an investment firm to those categories of staff, including senior management, risk takers, control functions and any employee receiving total remuneration that falls within the remuneration bracket of senior management and risk takers whose professional activities have a material impact on the risk profiles of the firm or of the assets that it manages complies with all of the following requirements:
Amendment 124 #
Proposal for a directive
Article 30 – paragraph 1 – point k
Article 30 – paragraph 1 – point k
(k) at least 40% of the variable remuneration shall be deferred over a three tot least five year periods as appropriate, depending on the business cycle of the investment firm, the nature of its business, its risks and the activities of the individual in question, except in the case of a variable remuneration of a particularly high amount where the proportion of the variable remuneration deferred is at least 60%;
Amendment 125 #
Proposal for a directive
Article 30 – paragraph 4 – subparagraph 1 – point a
Article 30 – paragraph 4 – subparagraph 1 – point a
(a) an investment firm, the asset valuevalue of on- and off-balance sheet assets of which is on average equal to or less than EUR 100 million over the four-year period immediately preceding the given financial year;
Amendment 146 #
Proposal for a directive
Article 33 – paragraph 1 – point f a (new)
Article 33 – paragraph 1 – point f a (new)
(fa) the integration of environmental, social and governance (ESG) factors and risks in the firm’s risk-management system and the exposure of investments firms to environmental risks.
Amendment 149 #
Proposal for a directive
Article 33 – paragraph 2
Article 33 – paragraph 2
2. Member States shall ensure that competent authorities establish the frequency and intensity of the review and evaluation referred to in paragraph 1 having regard to the size, systemic importance, nature, scale and complexity of the activities of the investment firms concerned and taking into account the principle of proportionality. The review and evaluation shall be updated at least on an annual basis for the investment firms that do not meet all of the conditions set out in that Article 12(1) of [Regulation (EU) ---/----[IFR].
Amendment 150 #
Proposal for a directive
Article 33 – paragraph 5
Article 33 – paragraph 5
5. When conducting the review and evaluation referred to in point (f) of paragraph 1, competent authorities shall have access to agendas, minutes and supporting documents for meetings of the management body and its committees, and the results of the internal or external evaluation of performance of the management body.
Amendment 151 #
Proposal for a directive
Article 33 – paragraph 6 a (new)
Article 33 – paragraph 6 a (new)
6a. For the purpose of point (g) the EBA shall by 1 June 2020 issue guidelines in accordance with Article 16 of Regulation (EU) No 1093/2010 to specify a methodology for the supervisory review and evaluation process regarding the integration of ESG factors and risks in the firm’s risk-management system. Such guidelines shall inter alia specify qualitative and quantitative criteria and metrics for the definition and the assessment of exposures to climate- change and environmental risks and in particular risks related to the depreciation of assets due to climate related regulatory changes. These guidelines shall take explicit account of the classification of activities contributing substantially or significantly harming environmental objectives and the methodology for identifying the percentage of assets funding environmentally sustainable economic activities as provided for in the Regulation [Regulation (EU) ---/---- [taxonomy], establishing a framework to facilitate sustainable investments.
Amendment 152 #
Proposal for a directive
Article 33 – paragraph 6 b (new)
Article 33 – paragraph 6 b (new)
6b. Taking into account the experience acquired in the application of the guidelines referred to in paragraph 7, EBA shall develop and update every two years thereafter draft regulatory technical standards to specify and update the methodology referred to in paragraph 7. EBA shall submit those draft regulatory technical standards to the Commission by 1 July 2021. Power is conferred on 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.
Amendment 153 #
Proposal for a directive
Article 34 – paragraph 2
Article 34 – paragraph 2
2. Where, for internal risk-to-market models, numerous overshootings as referred to in Article 366 of Regulation (EU) No 575/2013 indicate that the models are not or are no longer accurate, competent authorities shall revoke the permission to use the internal models or impose appropriate measures to ensure that the models are improved promptly and within a set timeframe.
Amendment 156 #
Proposal for a directive
Article 36 – paragraph 2 – subparagraph 1 – point b
Article 36 – paragraph 2 – subparagraph 1 – point b
(b) to require the reinforcement of the arrangements, processes, mechanisms and strategies implemented in accordance with Articles 22, 22a and 24;
Amendment 157 #
Proposal for a directive
Article 36 – paragraph 2 – subparagraph 1 – point c
Article 36 – paragraph 2 – subparagraph 1 – point c
(c) to require investment firms to present a plan to comply with supervisory requirements pursuant to this Directive and to [Regulation (EU) ---/----[IFR], to set a deadline which shall not exceed one year for the implementation of that plan and require improvements to that plan regarding scope and deadline;
Amendment 159 #
Proposal for a directive
Article 36 – paragraph 2 – subparagraph 1 – point l
Article 36 – paragraph 2 – subparagraph 1 – point l
(l) to require additional disclosures on an ad hoc basis.
Amendment 161 #
Proposal for a directive
Article 36 – paragraph 2 – subparagraph 2 – point b a (new)
Article 36 – paragraph 2 – subparagraph 2 – point b a (new)
(ba) the additional information is required for the duration of the institution’s supervisory review and evaluation process as referred to in Article 33.
Amendment 162 #
Proposal for a directive
Article 36 – paragraph 2 – subparagraph 3
Article 36 – paragraph 2 – subparagraph 3
Amendment 163 #
1. Competent authorities shall impose the additional capital requirement referred to in Article 36(2)(a) onlyat least where, on the basis of the reviews carried out in accordance with Articles 35 and 36, they conclude that an investment firm is in one of the following situations:
Amendment 168 #
Proposal for a directive
Article 37 – paragraph 2 – subparagraph 1
Article 37 – paragraph 2 – subparagraph 1
For the purpose of paragraph 1(a), risks or elements of risk shall only be considered as not covered or not sufficiently covered by the capital requirement set out in Part Three of [Regulation (EU) ---/----[IFR] where the amounts, types and distribution of capital considered adequate by the competent authority following the supervisory review of the assessment carried out by investment firms in accordance with Article 22(1) are higher than the investment firm’s capital requirement set out in Part Three of [Regulation (EU) ---/---[IFR].
Amendment 170 #
Proposal for a directive
Article 37 – paragraph 2 – subparagraph 2
Article 37 – paragraph 2 – subparagraph 2
Amendment 171 #
Proposal for a directive
Article 37 – paragraph 4 – subparagraph 1 (new)
Article 37 – paragraph 4 – subparagraph 1 (new)
Competent authorities may require institutions to meet the additional own funds requirements referred to in Article 36(2)(a) with CET 1 capital.
Amendment 172 #
Proposal for a directive
Article 37 – paragraph 5
Article 37 – paragraph 5
5. Competent authorities shall substantiatejustify in writing their decision to impose an additional capital requirement as referred to in Article 36(2)(a) by giving a clear account of the full assessment of the elements referred to in paragraphs 1 to 4 of this Article. That includes, in the case set out in paragraph 1(d) of this Article, a specific statement of why the level of capital established in accordance with Article 38(1) is no longer considered sufficient.
Amendment 173 #
Proposal for a directive
Article 37 – paragraph 6
Article 37 – paragraph 6
Amendment 175 #
Proposal for a directive
Article 38 – paragraph 1 – point a
Article 38 – paragraph 1 – point a
(a) cyclical economic fluctuations do not lead to a breach of those requirements; and
Amendment 176 #
Proposal for a directive
Article 38 – paragraph 2
Article 38 – paragraph 2
2. Competent authorities shall regularly review the level of capital that has been set by each investment firm in accordance with paragraph 1 and, where relevant, communicate the conclusions of that review to the investment firm concerned, including any expectation for adjustments to the level of capital established in accordance with paragraph 1. Such a communication shall include the date by which the competent authority requires the adjustment to be completed.
Amendment 177 #
Proposal for a directive
Article 38 – paragraph 2 a (new)
Article 38 – paragraph 2 a (new)
Amendment 179 #
Proposal for a directive
Article 39 – paragraph 1
Article 39 – paragraph 1
1. Competent authorities shall consult resolution authorities prior to determining any additional capital required pursuant to Article 36(2)(a) and prior to communicating to investment firms any expectation forthe adjustments to the level of capital as referred to in Article 38(2). For that purpose, competent authorities shall provide resolution authorities with all available information.
Amendment 180 #
Proposal for a directive
Article 39 – paragraph 2
Article 39 – paragraph 2
2. Competent authorities shall inform the relevant resolution authorities about the additional capital required pursuant to Article 36(2)(a) and about any expectation for adjustments as referred to in Article 38(2).
Amendment 182 #
Proposal for a directive
Article 41 – paragraph 2 – subparagraph 3 a (new)
Article 41 – paragraph 2 – subparagraph 3 a (new)
Taking into account the experience acquired in the application of the guidelines referred to in paragraph 2, EBA shall develop draft regulatory technical standards to specify the common procedures and methodologies for the supervisory review and evaluation process referred to in paragraph 1 and the assessment of the treatment of the risks referred to in Article 27. EBA shall submit those draft regulatory technical standards to the Commission by 1 July 2021. Power is conferred on 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
Amendment 185 #
Proposal for a directive
Article 51 – paragraph 3 a (new)
Article 51 – paragraph 3 a (new)
3a. When an investment firm established in the Union is part of a third country group whose subsidiaries and branches in the Union also comprise other investment firms, or AIFMs as defined in Article 2(1) of Directive 2011/61/EU, or management companies as defined in Article 2 (1b) of Directive 2009/65/EC, Member States shall require the formation of an intermediate EU parent undertaking that is established in the Union, unless such an intermediate parent already exists.
Amendment 186 #
Proposal for a directive
Article 51 – paragraph 3 b (new)
Article 51 – paragraph 3 b (new)
3b. Member States shall require an intermediate EU parent undertaking in the Union to obtain authorisation as a financial holding company, or as an investment holding company, or as a mixed financial holding company as defined in point (15) of Article 2 of Directive 2002/87/EC.
Amendment 187 #
Proposal for a directive
Article 51 – paragraph 3 c (new)
Article 51 – paragraph 3 c (new)
3c. Paragraphs 3a and 3b shall not apply where the volume of client assets under management in the Union of the third country group is lower than EUR 100 billion, unless the third country group is a non-EU G-SII.
Amendment 188 #
Proposal for a directive
Article 51 – paragraph 3 d (new)
Article 51 – paragraph 3 d (new)
3d. For the purposes of paragraphs 3a, 3b and 3c, the total value of assets in the Union of the third country group shall include the following: (a) the total assets of each institution in the Union of the third country group, as resulting from their consolidated balance sheet; and (b) the total assets of each branch of the third country group authorised in the Union.
Amendment 189 #
Proposal for a directive
Article 51 – paragraph 3 e (new)
Article 51 – paragraph 3 e (new)
3e. Competent authorities shall inform ESMA and EBA about every authorisation granted pursuant to paragraph 5.
Amendment 190 #
Proposal for a directive
Article 51 – paragraph 3 f (new)
Article 51 – paragraph 3 f (new)
3f. ESMA shall publish on its website the list of all intermediate EU parent undertakings that have been granted authorisation in the Union. Competent authorities shall ensure that there is a single intermediate EU parent undertaking for all institutions that are part of the same third country group.
Amendment 201 #
Proposal for a directive
Article 60 – paragraph 1 – introductory part
Article 60 – paragraph 1 – introductory part
By [three years after the date of application of this Directive and Regulation (EU) ---/-- --[IFR]] and every three years thereafter, the Commission, in close cooperation with EBA, ESRB and ESMA, shall submit a report, together with a legislative proposal if appropriate, to the European Parliament and to the Council, on the following:
Amendment 202 #
Proposal for a directive
Article 60 – paragraph 1 – point a
Article 60 – paragraph 1 – point a
(a) the provisions on remuneration in this Directive and in Regulation (EU) ---/-- -- [IFR] as well as in UCITS and AIFMD with the aim to achieve a level playing field for all investment firms active in the Union;
Amendment 203 #
Proposal for a directive
Article 60 – paragraph 1 – point d a (new)
Article 60 – paragraph 1 – point d a (new)
(da) the need to develop appropriate macroprudential tools to address the build-up and the materialisation of systemic risks, including liquidity mismatch risk and leverage in the investment industry. The Commission should pay close attention to ongoing work at the Financial Stability Board and International Organization of Securities Commissions and translate those principles into EU law.
Amendment 204 #
Proposal for a directive
Article 60 – paragraph 1 – point d b (new)
Article 60 – paragraph 1 – point d b (new)
(db) the potential systemic impact of the three classes of investment firms and the necessity to tailor the macroprudential perspective to the specificities of investment firms’ business models.