Regulation (EU) 2019/2175 of the European Parliament and of the Council of 18 December 2019 amending Regulation (EU) No 1093/2010 establishing a European Supervisory Authority (European Banking Authority), Regulation (EU) No 1094/2010 establishing a European Supervisory Authority (European Insurance and Occupational Pensions Authority), Regulation (EU) No 1095/2010 establishing a European Supervisory Authority (European Securities and Markets Authority), Regulation (EU) No 600/2014 on markets in financial instruments, Regulation (EU) 2016/1011 on indices used as benchmarks in financial instruments and financial contracts or to measure the performance of investment funds, and Regulation (EU) 2015/847 on information accompanying transfers of funds (Text with EEA relevance) (Text with EEA relevance)

(a) the mechanisms which allow the Authority to obtain relevant information, including information on the regulatory regime, the supervisory approach, relevant market developments and any changes that may affect the equivalence decision; (b) to the extent necessary for the follow-up of such equivalence decisions, the procedures concerning the coordination of supervisory activities including, where necessary, on-site inspections. The Authority shall inform the Commission where a third-country competent authority refuses to conclude such administrative arrangements or when it refuses to effectively cooperate.

In the report referred to in Article 43(5), the Authority shall include information on the administrative arrangements agreed upon with supervisory authorities, international organisations or administrations in third countries, the assistance provided by the Authority to the Commission in preparing equivalence decisions and the monitoring by the Authority in accordance with paragraph 3 of this Article.

(28) Article 34 is deleted;

(29) Article 36 is amended as follows: (a) paragraph 3 is deleted; (b) paragraphs 4 and 5 are replaced by the following: ‘4. On receipt of a warning or recommendation from the ESRB addressed to the Authority, the Authority shall discuss that warning or recommendation at the next meeting of the Board of Supervisors or, where appropriate, earlier, in order to assess the implications of, and possible follow-up to, such a warning or recommendation for the fulfilment of its tasks. It shall decide, by the relevant decision-making procedure, on any actions to be taken in accordance with the powers conferred upon it by this Regulation for addressing the issues identified in the warnings and recommendations. If the Authority does not act on a warning or recommendation, it shall explain to the ESRB its reasons for not doing so. The ESRB shall inform the European Parliament thereof in accordance with Article 19(5) of Regulation (EU) No 1092/2010. The ESRB shall also inform the Council thereof.

Where the addressee intends not to follow the recommendation of the ESRB, it shall inform and discuss with the Board of Supervisors its reasons for not acting. Where the competent authority, in accordance with Article 17(1) of Regulation (EU) No 1092/2010, informs the European Parliament, the Council, the Commission and the ESRB of the actions it has undertaken in response to a recommendation of the ESRB, it shall take due account of the views of the Board of Supervisors.’; (c) paragraph 6 is deleted;

(30) Article 37 is amended as follows: (a) paragraphs 2 and 3 are replaced by the following: ‘2. The Banking Stakeholder Group shall be composed of 30 members. Those members shall comprise of: (a) 13 members representing, in balanced proportions, financial institutions operating in the Union of whom three shall represent cooperative and savings banks; (b) 13 members representing employees’ representatives of financial institutions operating in the Union, consumers, users of banking services and representatives of SMEs; and (c) four members who are independent top-ranking academics.

(b) the following paragraph is inserted: ‘3a. Members of the Banking Stakeholder Group shall elect a Chair from among its members. The position of Chair shall be held for a period of two years. The European Parliament may invite the Chair of the Banking Stakeholder Group to make a statement before it and answer any questions from its members whenever so requested.’; (c) in paragraph 4, the first subparagraph is replaced by the following: ‘4. The Authority shall provide all necessary information subject to professional secrecy as set out in Article 70 of this Regulation and ensure adequate secretarial support for the Banking Stakeholder Group. Adequate compensation shall be provided to members of the Banking Stakeholder Group representing non-profit organisations, excluding industry representatives. This compensation shall take into account the members’ preparatory and follow-up work and shall be at least equivalent to the reimbursement rates of officials pursuant to Title V, Chapter 1, Section 2 of the Staff Regulations of Officials of the European Union and the Conditions of Employment of Other Servants of the European Union, laid down in Council Regulation (EEC, Euratom, ECSC) No 259/68 (^*21) (the Staff Regulations). The Banking Stakeholder Group may establish working groups on technical issues. Members of the Banking Stakeholder Group shall serve for a period of four years, following which a new selection procedure shall take place. (d) paragraph 5 is replaced by the following: ‘5. The Banking Stakeholder Group may submit advice to the Authority on any issue related to the tasks of the Authority with particular focus on the tasks set out in Articles 10 to 16, 29, 30 and 32. Where members of the Banking Stakeholder Group cannot agree on advice, one third of its members or the members representing one group of stakeholders shall be permitted to issue separate advice. The Banking Stakeholder Group, the Securities and Markets Stakeholder Group, the Insurance and Reinsurance Stakeholder Group, and the Occupational Pensions Stakeholder Group may issue a joint advice on issues related to the work of the ESAs under Article 56 on joint positions and common acts.’; (e) paragraph 7 is replaced by the following: ‘7. The Authority shall make public the advice of the Banking Stakeholder Group, the separate advice of its members, and the results of its consultations as well as information on how advice and results of consultations have been taken into account.’;

(31) Article 39 is replaced by the following: ‘Article 39 Decision-making procedures

(32) Article 40 is amended as follows: (a) in paragraph 1, point (a) is replaced by the following: ‘(a) the Chairperson;’; (b) the following paragraph is added: ‘8. Where the national public authority referred to in point (b) of paragraph 1 is not responsible for the enforcement of consumer protection rules, the member of the Board of Supervisors referred to in that point may decide to invite a representative from the Member State’s consumer protection authority, who shall be non-voting. In the case where the responsibility for consumer protection is shared by several authorities in a Member State, those authorities shall agree on a common representative.’;

(33) Articles 41 and 42 are replaced by the following: ‘Article 41 Internal committees

Each member of the panel shall have one vote. Decisions of the panel shall be taken where at least four members vote in favour.

Each member of the panel shall have one vote. Decisions of the panel shall be taken where at least four members vote in favour.

Each member of the panel shall have one vote. Decisions of the panel shall be taken where at least four members vote in favour.

Article 42

Independence of the Board of Supervisors

(34) Article 43 is amended as follows: (a) paragraph 1 is replaced by the following: ‘1. The Board of Supervisors shall give guidance to the work of the Authority and shall be in charge of taking the decisions referred to in Chapter II. The Board of Supervisors shall adopt the opinions, recommendations, guidelines and decisions of the Authority, and issue the advice referred to in Chapter II, based on a proposal of the relevant internal committee or panel, the Chairperson, or of the Management Board, as applicable.’; (b) paragraphs 2 and 3 are deleted; (c) paragraph 5 is replaced by the following: ‘5. The Board of Supervisors shall adopt, on the basis of a proposal by the Management Board, the annual report on the activities of the Authority, including on the performance of the Chairperson’s duties, and shall transmit that report to the European Parliament, to the Council, to the Commission, to the Court of Auditors and to the European Economic and Social Committee by 15 June each year. The report shall be made public.’; (d) paragraph 8 is replaced by the following: ‘8. The Board of Supervisors shall exercise disciplinary authority over the Chairperson and the Executive Director. It may remove the Executive Director from office in accordance with Article 51(5).’;

(35) the following Article is inserted: ‘Article 43a Transparency of decisions adopted by the Board of Supervisors Notwithstanding Article 70, within six weeks of each meeting of the Board of Supervisors, the Authority shall, at least provide the European Parliament with a comprehensive and meaningful record of the proceedings of that meeting that enables a full understanding of the discussions, including an annotated list of decisions. Such record shall not reflect discussions within the Board of Supervisors relating to individual financial institutions, unless otherwise provided for in Article 75(3) or in the legislative acts referred to in Article 1(2).’;

(36) Article 44 is amended as follows: (a) paragraph 1 is replaced by the following: ‘1. Decisions of the Board of Supervisors shall be taken by a simple majority of its members. Each voting member shall have one vote. With regard to the acts specified in Articles 10 to 16 of this Regulation and measures and decisions adopted under the third subparagraph of Article 9(5) of this Regulation, and Chapter VI of this Regulation and, by way of derogation from the first subparagraph of this paragraph, the Board of Supervisors shall take decisions on the basis of a qualified majority of its members, as defined in Article 16(4) TEU and in Article 3 of the Protocol No 36 on transitional provisions, which shall include at least a simple majority of the members, present at the vote, from competent authorities of Member States that are participating Member States as defined in point (1) of Article 2 of Regulation (EU) No 1024/2013 (“participating Member States”) and a simple majority of the members, present at the vote, from competent authorities of Member States that are not participating Member States (“non-participating Member States”). The Chairperson shall not vote on the decisions referred to in the second subparagraph. With regard to the composition of the panels in accordance with Article 41(2), (3) and (4), and the members of the peer review committee referred to in Article 30(2), the Board of Supervisors, when considering the proposals by its Chairperson, shall strive for consensus. In the absence of consensus, decisions of the Board of Supervisors shall be taken by a majority of three quarters of its voting members. Each voting member shall have one vote. With regard to decisions adopted under Article 18(3) and (4), and by way of derogation from the first subparagraph of this paragraph, the Board of Supervisors shall take decisions on the basis of a simple majority of its voting members, which shall include a simple majority of its members from competent authorities of participating Member States and a simple majority of its members from competent authorities of non-participating Member States.’; (b) the following paragraphs are inserted: ‘3a. With regard to the decisions in accordance with Article 30, the Board of Supervisors shall vote on the proposed decisions using a written procedure. The voting members of the Board of Supervisors shall have eight working days to vote. Each voting member shall have one vote. The proposed decision shall be considered adopted unless a simple majority of voting members of the Board of Supervisors objects. Abstentions shall not be counted as approvals or as objections, and shall not be considered when calculating the number of votes cast. If three voting members of the Board of Supervisors object to the written procedure, the draft decision shall be discussed and decided on by the Board of Supervisors in accordance with the procedure set out in paragraph 1 of this Article. 3b. With regard to decisions in accordance with Articles 17 and 19, the Board of Supervisors shall vote on the proposed decision using a written procedure. The voting members of the Board of Supervisors shall have eight working days to vote. Each voting member shall have one vote. The proposed decision shall be considered adopted unless a simple majority of its members from competent authorities of participating Member States, or a simple majority of its members from competent authorities of non-participating Member States, objects to it. Abstentions shall not be counted as approvals or as objections, and shall not be considered when calculating the number of votes cast. If three voting members of the Board of Supervisors object to the written procedure, the draft decision shall be discussed by the Board of Supervisors and can be adopted by a simple majority of the voting members of the Board of Supervisors, which shall include a simple majority of its members from competent authorities of participating Member States and a simple majority of its members from competent authorities of non-participating Member States. By way of derogation from the first subparagraph, from the date when four or fewer voting members are from competent authorities of non-participating Member States, the decision proposed shall be adopted by a simple majority of the voting members of the Board of Supervisors, which shall include at least one vote from members from competent authorities of non-participating Member States.’; (c) paragraphs 4 and 4a are replaced by the following: ‘4. The non-voting members and the observers shall not attend any discussions within the Board of Supervisors relating to individual financial institutions, unless otherwise provided for in Article 75(3) or in the legislative acts referred to in Article 1(2). The first subparagraph shall not apply to the Executive Director and the European Central Bank representative nominated by its Supervisory Board. 4a. The Authority’s Chairperson shall have the prerogative to call a vote at any time. Without prejudice to that power and to the effectiveness of the Authority’s decision-making procedures, the Board of Supervisors of the Authority shall strive for consensus when taking its decisions.’;

(37) Article 45 is replaced by the following: ‘Article 45 Composition

Other than the Chairperson, each member of the Management Board shall have an alternate, who may replace him or her if he or she is prevented from attending.

(38) the following Articles are inserted: ‘Article 45a Decision-making

Article 45b

Coordination Groups

(39) Article 46 is replaced by the following: ‘Article 46 Independence of the Management Board The members of the Management Board shall act independently and objectively in the sole interest of the Union as a whole and shall neither seek nor take instructions from the Union institutions or bodies, from any government or from any other public or private body. Member States, Union institutions or bodies and any other public or private body shall not seek to influence the members of the Management Board in the performance of their tasks.’;

(40) Article 47 is amended as follows: (a) the following paragraph is inserted: ‘3a. The Management Board may examine, give an opinion on, and make proposals on all matters, except for tasks laid down in Articles 9a, 9b, 30 as well as Articles 17 and 19 on matters concerning the prevention of the use of the financial system for the purpose of money laundering and of terrorist financing.’; (b) paragraph 6 is replaced by the following: ‘6. The Management Board shall propose an annual report on the activities of the Authority, including on the Chairperson’s duties, to the Board of Supervisors for approval.’; (c) paragraph 8 is replaced by the following: ‘8. The Management Board shall appoint and remove the members of the Board of Appeal in accordance with Article 58(3) and (5), taking duly into account a proposal by the Board of Supervisors.’; (d) the following paragraph is added: ‘9. The members of the Management Board shall make public all meetings held and any hospitality received. Expenses shall be recorded publicly in accordance with the Staff Regulations.’;

(41) Article 48 is amended as follows: (a) in paragraph 1, the second subparagraph is replaced by the following: ‘The Chairperson shall be responsible for preparing the work of the Board of Supervisors, including setting the agenda to be adopted by the Board of Supervisors, convening the meetings and tabling items for decision, and shall chair the meetings of the Board of Supervisors. The Chairperson shall be responsible for setting the agenda of the Management Board, to be adopted by the Management Board, and shall chair the meetings of the Management Board. The Chairperson may invite the Management Board to consider setting up a coordination group in accordance with Article 45b.’; (b) paragraph 2 is replaced by the following: ‘2. The Chairperson shall be selected on the basis of merit, skills, knowledge of financial institutions and markets, and of experience relevant to financial supervision and regulation, following an open selection procedure which shall respect the principle of gender balance and shall be published in the Official Journal of the European Union. The Board of Supervisors shall draw up a shortlist of qualified candidates for the position of the Chairperson, with the assistance of the Commission. Based on the shortlist, the Council shall adopt a decision to appoint the Chairperson, after confirmation by the European Parliament. Where the Chairperson no longer fulfils the conditions referred to in Article 49 or has been found guilty of serious misconduct, the Council may, acting on a proposal from the Commission which has been approved by the European Parliament, adopt a decision to remove him or her from office. The Board of Supervisors shall also elect, from among its members, a Vice-Chairperson who shall carry out the functions of the Chairperson in the absence of the Chairperson. That Vice-Chairperson shall not be elected from among the members of the Management Board.’; (c) in paragraph 4, the second subparagraph is replaced by the following: ‘For the purpose of the evaluation referred to in the first subparagraph, the tasks of the Chairperson shall be carried out by the Vice-Chairperson. The Council, acting on a proposal from the Board of Supervisors and with the assistance of the Commission, and taking into account the evaluation referred to in the first subparagraph, may extend the term of office of the Chairperson once.’; (d) paragraph 5 is replaced by the following: ‘5. The Chairperson may be removed from office only on serious grounds. He or she may only be removed by the European Parliament following a decision of the Council, adopted after consulting the Board of Supervisors.’;

(42) Article 49 is amended as follows: (a) the title is replaced by the following: ‘Independence of the Chairperson’; (b) the first paragraph is replaced by the following: ‘Without prejudice to the role of the Board of Supervisors in relation to the tasks of the Chairperson, the Chairperson shall neither seek nor take instructions from the Union institutions or bodies, from any government or from any other public or private body.’;

(43) Article 49a is replaced by the following: ‘Article 49a Expenses The Chairperson shall make public all meetings held with external stakeholders within a period of two weeks following the meeting and any hospitality received. Expenses shall be recorded publicly in accordance with the Staff Regulations.’;

(44) Article 50 is deleted;

(45) Article 54 is amended as follows: (a) paragraph 2 is amended as follows: (i) the introductory part is replaced by the following: ‘2. The Joint Committee shall serve as a forum in which the Authority shall cooperate regularly and closely to ensure cross-sectoral consistency, while considering sectoral specificities, with the European Supervisory Authority (European Insurance and Occupational Pensions Authority) and the European Supervisory Authority (European Securities and Markets Authority), in particular regarding:’; (ii) the first indent is replaced by the following: — ‘— financial conglomerates and, where required by Union law, prudential consolidation,’; (iii) the fifth and sixth indents are replaced by the following: — ‘— cybersecurity, — information and best practice exchange with the ESRB and the other ESAs,’; (iv) the following indents are added: — ‘— retail financial services and depositor, consumer and investor protection issues; — advice by the Committee established in accordance with Article 1(6).’; (b) the following paragraph is inserted: ‘2a. The Joint Committee may assist the Commission in assessing the conditions and the technical specifications and procedures for ensuring secure and efficient interconnection of the centralised automated mechanisms pursuant to the report referred in Article 32a(5) of Directive (EU) 2015/849 as well as in the effective interconnection of the national registers under that Directive.’; (c) paragraph 3 is replaced by the following: ‘3. The Joint Committee shall have a dedicated staff provided by the ESAs that shall act as a permanent secretariat. The Authority shall contribute adequate resources to administrative, infrastructure and operational expenses.’;

(46) Article 55 is amended as follows: (a) paragraph 3 is replaced by the following: ‘3. The Chairperson of the Joint Committee shall be appointed on an annual rotational basis from among the Chairpersons of the ESAs. The Chairperson of the Joint Committee shall be the second Vice-Chair of the ESRB.’; (b) in paragraph 4, the second subparagraph is replaced by the following: ‘The Joint Committee shall meet at least once every three months.’; (c) the following paragraph is added: ‘5. The Chairperson of the Authority shall regularly inform the Board of Supervisors on positions taken in the meetings of the Joint Committee.’;

(47) Articles 56 and 57 are replaced by the following: ‘Article 56 Joint positions and common acts Within the scope of its tasks set out in Chapter II of this Regulation, and in particular with respect to the implementation of Directive 2002/87/EC, where relevant, the Authority shall reach joint positions by consensus with, as appropriate, the European Supervisory Authority (European Insurance and Occupational Pensions Authority) and with the European Supervisory Authority (European Securities and Markets Authority). Where required by Union law, measures pursuant to Articles 10 to 16, and decisions pursuant to Articles 17, 18 and 19, of this Regulation in relation to the application of Directive 2002/87/EC and of any other legislative acts referred to in Article 1(2) of this Regulation that also fall within the area of competence of the European Supervisory Authority (European Insurance and Occupational Pensions Authority) or the European Supervisory Authority (European Securities and Markets Authority) shall be adopted, in parallel, by, as appropriate, the Authority, the European Supervisory Authority (European Insurance and Occupational Pensions Authority), and the European Supervisory Authority (European Securities and Markets Authority).

Article 57

Sub-Committees

(48) Article 58 is amended as follows: (a) paragraph 1 is replaced by the following: ‘1. The Board of Appeal of the European Supervisory Authorities is hereby established.’; (b) in paragraph 2, the first subparagraph is replaced by the following: ‘2. The Board of Appeal shall be composed of six members and six alternates, who shall be individuals of high repute with a proven record of relevant knowledge of Union law and of having international professional experience, to a sufficiently high level in the fields of banking, insurance, occupational pensions, securities markets or other financial services, excluding current staff of the competent authorities or other national or Union institutions or bodies involved in the activities of the Authority and members of the Banking Stakeholder Group. Members and alternates shall be nationals of a Member State and shall have a thorough knowledge of at least two official languages of the Union. The Board of Appeal shall have sufficient legal expertise to provide expert legal advice on the legality, including proportionality, of the Authority’s exercise of its powers.’; (c) paragraph 3 is replaced by the following: ‘3. Two members of the Board of Appeal and two alternates shall be appointed by the Management Board of the Authority from a shortlist proposed by the Commission, following a public call for expressions of interest published in the Official Journal of the European Union, and after consultation of the Board of Supervisors. After having received the shortlist, the European Parliament may invite candidates for members and alternates to make a statement before it and answer any questions from its Members. The European Parliament may invite the members of the Board of Appeal to make a statement before it and answer any questions from its Members whenever so requested, to the exclusion of statements, questions or answers pertaining to individual cases decided by, or pending before, the Board of Appeal.’;

(49) in Article 59, paragraph 2 is replaced by the following: ‘2. Members of the Board of Appeal, and staff of the Authority providing operational and secretariat support, shall not take part in any appeal proceedings in which they have any personal interest, if they have previously been involved as representatives of one of the parties to the proceedings, or if they have participated in the decision under appeal.’;

(50) in Article 60, paragraph 2 is replaced by the following: ‘2. The appeal, together with a statement of grounds, shall be filed in writing at the Authority within three months of the date of notification of the decision to the person concerned, or, in the absence of a notification, of the day on which the Authority published its decision. The Board of Appeal shall decide upon the appeal within three months after the appeal has been lodged.’;

(51) the following article is inserted: ‘Article 60a Exceeding of competence by the Authority Any natural or legal person may send reasoned advice to the Commission if that person is of the opinion that the Authority has exceeded its competence, including by failing to respect the principle of proportionality referred to in Article 1(5), when acting under Articles 16 and 16b, and that is of direct and individual concern to that person.’;

(52) in Article 62, paragraph 1 is amended as follows: (a) the introductory part is replaced by the following: ‘1. The revenues of the Authority, a European body in accordance with Article 70 of Regulation (EU, Euratom) 2018/1046 of the European Parliament and of the Council (^*22) (“the Financial Regulation”), shall consist, in particular, of any combination of the following: (b) the following points are added: ‘(d) any voluntary contribution from Member States or observers; (e) agreed charges for publications, training and for any other services provided by the Authority where they have been specifically requested by one or more competent authorities.’; (c) the following sub-paragraph is added: ‘Any voluntary contribution from Member States or observers referred to in point (d) of the first sub-paragraph shall not be accepted if such acceptance would cast doubt on the independence and impartiality of the Authority. Voluntary contributions that constitute compensation for the cost of tasks delegated by a competent authority to the Authority shall not be considered to cast doubt on the independence of the latter.’;

(53) Articles 63, 64 and 65 are replaced by the following: ‘Article 63 Establishment of the budget

Article 64

Implementation and control of the budget

The Authority’s accounting officer shall also send, by 15 June each year, a reporting package to the Commission’s accounting officer, in a standardised format as laid down by the Commission’s accounting officer for consolidation purposes.

Article 65

Financial rules The financial rules applicable to the Authority shall be adopted by the Management Board after consulting the Commission. Those rules may not depart from Commission Delegated Regulation (EU) 2019/715 (^*23) unless the specific operational needs for the functioning of the Authority so require and only with the prior agreement of the Commission.

(54) in Article 66, paragraph 1 is replaced by the following: ‘1. For the purposes of combating fraud, corruption and any other illegal activity, Regulation (EU, Euratom) No 883/2013 of the European Parliament and of the Council (^*24) shall apply to the Authority without any restriction.

(55) Article 70 is amended as follows: (a) paragraph 1 is replaced by the following: ‘1. Members of the Board of Supervisors, and all members of the staff of the Authority, including officials seconded by Member States on a temporary basis, and all other persons carrying out tasks for the Authority on a contractual basis, shall be subject to the requirements of professional secrecy pursuant to Article 339 TFEU and the relevant provisions in Union legislation, even after their duties have ceased.’; (b) in paragraph 2, the second subparagraph is replaced by the following: ‘The obligation under paragraph 1 of this Article and the first subparagraph of this paragraph shall not prevent the Authority and the competent authorities from using the information for the enforcement of the legislative acts referred to in Article 1(2), and in particular for legal procedures for the adoption of decisions.’; (c) the following paragraph is inserted: ‘2a. The Management Board and the Board of Supervisors shall ensure that individuals who provide any service, directly or indirectly, permanently or occasionally, relating to the tasks of the Authority, including officials and other persons authorised by the Management Board and the Board of Supervisors or appointed by the competent authorities for that purpose, are subject to the requirements of professional secrecy equivalent to those in paragraphs 1 and 2. The same requirements for professional secrecy shall also apply to observers who attend the meetings of the Management Board and the Board of Supervisors and who take part in the activities of the Authority.’; (d) paragraphs 3 and 4 are replaced by the following: ‘3. Paragraphs 1 and 2 shall not prevent the Authority from exchanging information with competent authorities in accordance with this Regulation and with other Union legislation applicable to financial institutions. That information shall be subject to the conditions of professional secrecy referred to in paragraphs 1 and 2. The Authority shall lay down in its internal rules of procedure the practical arrangements for implementing the confidentiality rules referred to in paragraphs 1 and 2.

(56) Article 71 is replaced by the following: ‘Article 71 Data protection This Regulation shall be without prejudice to the obligations of Member States relating to their processing of personal data under Regulation (EU) 2016/679 or the obligations of the Authority relating to its processing of personal data under Regulation (EU) 2018/1725 of the European Parliament and of the Council (^*26) when fulfilling its responsibilities.

(57) in Article 72, paragraph 2 is replaced by the following: ‘2. The Management Board shall adopt practical measures for applying Regulation (EC) No 1049/2001.’;

(58) in Article 74, the first paragraph is replaced by the following: ‘The necessary arrangements concerning the accommodation to be provided for the Authority in the Member State where its seat is located and the facilities to be made available by that Member State, as well as the specific rules applicable in that Member State to the staff of the Authority and members of their families, shall be laid down in a Headquarters Agreement between the Authority and that Member State which they concluded after obtaining the approval of the Management Board.’;

(59) Article 76 is replaced by the following: ‘Article 76 Relationship with the Committee of European Banking Supervisors The Authority shall be considered the legal successor of Committee of European Banking Supervisors (CEBS). By the date of establishment of the Authority, all assets and liabilities and all pending operations of CEBS shall be automatically transferred to the Authority. CEBS shall establish a statement showing its closing asset and liability situation as of the date of that transfer. That statement shall be audited and approved by CEBS and by the Commission.’;

(60) Article 81 is amended as follows: (a) paragraph 1 is amended as follows: (i) the introductory sentence is replaced by the following: ‘1. By 31 December 2021, and every three years thereafter, the Commission shall publish a general report on the experience acquired as a result of the operation of the Authority and the procedures laid down in this Regulation. That report shall evaluate, inter alia:’; (ii) in point (a), the introductory sentence, and point (i) are replaced by the following: ‘(a) the effectiveness and convergence in supervisory practices reached by competent authorities: (i) the independence of the competent authorities and convergence in standards equivalent to corporate governance;’; (iii) the following points are added: ‘(g) the functioning of the Joint Committee; (h) the obstacles to or impact on prudential consolidation pursuant to Article 8.’; (b) the following paragraphs are inserted: ‘2a. As part of the general report referred to in paragraph 1 of this Article, the Commission shall, after consulting all relevant authorities and stakeholders, conduct a comprehensive assessment of the application of Article 9c. 2b. As part of the general report referred to in paragraph 1 of this Article, the Commission shall, after consulting all relevant competent authorities and stakeholders, conduct a comprehensive assessment of the implementation, functioning and effectiveness of the specific tasks related to preventing and countering money laundering and terrorist financing and conferred on the Authority pursuant to Article 1(2), point (l) of Article 8(1), and Articles 9a, 9b, 17 and 19, of this Regulation. As part of its assessment, the Commission shall analyse the interaction between those tasks and the tasks conferred on the European Supervisory Authority (European Insurance and Occupational Pensions Authority) and the European Supervisory Authority (European Securities and Markets Authority), as well as the legal practicality of the powers of the Authority to the extent they allow the Authority to base action on national law that transposes Directives or exercises options. In addition, the Commission shall, based on a comprehensive cost and benefit analysis as well as following the objective of ensuring consistency, efficiency and effectiveness, thoroughly investigate the possibility of conferring specific tasks with regard to the prevention and countering of money laundering or of terrorist financing on an existing or new dedicated EU-wide agency.’.

Article 2

Amendments to Regulation (EU) No 1094/2010

Regulation (EU) No 1094/2010 is amended as follows:

(1) Article 1 is amended as follows: (a) paragraphs 2 and 3 are replaced by the following: ‘2. The Authority shall act within the powers conferred by this Regulation and within the scope of Directive 2009/138/EC with the exception of Title IV thereof, of Directive 2002/87/EC, Directive (EU) 2016/97 (²⁷) and Directive (EU) 2016/2341 (28) of the European Parliament and of the Council, and, to the extent that those acts apply to insurance undertakings, reinsurance undertakings, institutions for occupational retirement provision and insurance intermediaries, within the relevant parts of Directive 2002/65/EC, including all directives, regulations, and decisions based on those acts, and of any further legally binding Union act which confers tasks on the Authority. The Authority shall contribute to the work of the European Supervisory Authority (European Banking Authority) established by Regulation (EU) No 1093/2010 of the European Parliament and of the Council (²⁹) related to the prevention of the use of the financial system for the purpose of money laundering or terrorist financing in accordance with Directive (EU) 2015/849 of the European Parliament and of the Council (30) and Regulation (EU) No 1093/2010. The Authority shall decide on its agreement in accordance with Article 9a(9) of Regulation (EU) No 1093/2010.

(b) paragraph 6 is amended as follows: (i) the first subparagraph is amended as follows: — the introductory part is replaced by the following: ‘6. The objective of the Authority shall be to protect the public interest by contributing to the short-, medium- and long-term stability and effectiveness of the financial system, for the Union economy, its citizens and businesses. The Authority shall, within its respective competences, contribute to:’; — points (e) and (f) are replaced by the following: ‘(e) ensuring that the taking of risks related to insurance, reinsurance and occupational pensions activities is appropriately regulated and supervised; (f) enhancing customer and consumer protection; and’; — the following point is added: ‘(g) enhancing supervisory convergence across the internal market.’; (ii) the second subparagraph is replaced by the following: ‘For those purposes, the Authority shall contribute to ensuring the consistent, efficient and effective application of the acts referred to in paragraph 2 of this Article, foster supervisory convergence, and provide opinions in accordance with Article 16a to the European Parliament, to the Council, and to the Commission.’; (iii) the fourth subparagraph is replaced by the following: ‘When carrying out its tasks, the Authority shall act independently, objectively and in a non-discriminatory and transparent manner, in the interests of the Union as a whole and shall respect, wherever relevant, the principle of proportionality. The Authority shall be accountable and act with integrity and shall ensure that all stakeholders are treated fairly.’; (iv) the following subparagraph is added: ‘The content and form of the Authority’s actions and measures, in particular guidelines, recommendations, opinions, questions and answers, draft regulatory standards and draft implementing standards, shall fully respect the applicable provisions of this Regulation and of the legislative acts referred to in paragraph 2. To the extent permitted and relevant under those provisions, the Authority’s actions and measures shall, in accordance with the principle of proportionality, take due account of the nature, scale and complexity of the risks inherent in the business of a financial institution, undertaking, other subject or financial activity, that is affected by the Authority’s actions and measures.’; (c) the following paragraph is added: ‘7. The Authority shall establish, as an integral part thereof, a Committee advising it as to how, in full compliance with applicable rules, its actions and measures should take account of specific differences prevailing in the sector, pertaining to the nature, scale and complexity of risks, to business models and practice as well as to the size of financial institutions and of markets to the extent that such factors are relevant under the rules considered.’;

(2) Article 2 is amended as follows: (a) paragraph 1 is replaced by the following: ‘1. The Authority shall form part of a European system of financial supervision (ESFS). The main objective of the ESFS shall be to ensure that the rules applicable to the financial sector are adequately implemented to preserve financial stability and to ensure confidence in the financial system as a whole and effective and sufficient protection for the customers and consumers of financial services.’; (b) paragraph 4 is replaced by the following: ‘4. In accordance with the principle of sincere cooperation pursuant to Article 4(3) of the Treaty on European Union (TEU), the parties to the ESFS shall cooperate with trust and full mutual respect, in particular in ensuring the flow of appropriate and reliable information among them and from the Authority to the European Parliament, to the Council and to the Commission.’; (c) in paragraph 5, the following subparagraph is added: ‘Without prejudice to national competences, references in this Regulation to supervision shall include all relevant activities of all competent authorities to be carried out pursuant to the legislative acts referred to in Article 1(2).’;

(3) Article 3 is replaced by the following: ‘Article 3 Accountability of the Authorities

(4) in Article 4, point (2), point (ii) is replaced by the following: ‘(ii) with regard to Directive 2002/65/EC, the authorities and bodies competent for ensuring compliance with the requirements of that Directive by financial institutions;’;

(5) In Article 7 the following paragraph is added: ‘The location of the seat of the Authority shall not affect the Authority’s execution of its tasks and powers, the organisation of its governance structure, the operation of its main organisation, or the main financing of its activities, while allowing, where applicable, for the sharing with Union agencies of administrative support services and facility management services which are not related to the core activities of the Authority.’;

(6) Article 8 is amended as follows: (a) paragraph 1 is amended as follows: (i) point (a) is replaced by the following: ‘(a) based on the legislative acts referred to in Article 1(2), to contribute to the establishment of high-quality common regulatory and supervisory standards and practices, in particular by developing draft regulatory and implementing technical standards, guidelines, recommendations, and other measures, including opinions;’; (ii) the following point is inserted: ‘(aa) to develop and maintain an up-to-date Union supervisory handbook on the supervision of financial institutions in the Union which is to set out best practices and high-quality methodologies and processes, and takes into account, inter alia, changing business practices and business models and the size of financial institutions and of markets;’; (iii) point (b) is replaced by the following: ‘(b) to contribute to the consistent application of legally binding Union acts, in particular by contributing to a common supervisory culture, ensuring consistent, efficient and effective application of the legislative acts referred to in Article 1(2), preventing regulatory arbitrage, fostering and monitoring supervisory independence, mediating and settling disagreements between competent authorities, ensuring effective and consistent supervision of financial institutions, ensuring a coherent functioning of colleges of supervisors, and taking actions, inter alia, in emergency situations;’; (iv) points (e) to (h) are replaced by the following: ‘(e) to organise and conduct peer reviews of competent authorities, and, in that context, to issue guidelines and recommendations and to identify best practices, with a view to strengthening consistency in supervisory outcomes; (f) to monitor and assess market developments in the area of its competence including where relevant, developments relating to trends in insurance, reinsurance and occupational pensions, in particular, to households and SMEs and in innovative financial services duly considering developments relating to environmental, social and governance related factors; (g) to undertake market analyses to inform the discharge of the Authority’s functions; (h) to foster, where relevant, the protection of policyholders, pension scheme members and beneficiaries, consumers and investors, in particular with regards to shortcomings in a cross-border context and taking related risks into account;’; (v) the following point is inserted after point (i): ‘(ia) to contribute to the establishment of a common Union financial data strategy;’; (vi) the following point is inserted after point (k): ‘(ka) to publish on its website, and to update regularly, all regulatory technical standards, implementing technical standards, guidelines, recommendations and questions and answers for each legislative act referred to in Article 1(2), including overviews that concern the state of play of ongoing work and the planned timing of the adoption of draft regulatory technical standards and draft implementing technical standards.’; (vii) point (l) is deleted; (b) the following paragraph is inserted: ‘1a. When carrying out its tasks in accordance with this Regulation, the Authority shall: (a) use the full powers available to it; (b) with due regard to the objective to ensure the safety and soundness of financial institutions, take fully into account the different types, business models and sizes of financial institutions; and (c) take account of technological innovation, innovative and sustainable business models such as cooperatives and mutuals, and the integration of environmental, social and governance related factors.’; (c) paragraph 2 is amended as follows: (i) the following points are inserted: ‘(ca) issue recommendations, as laid down in Article 29a;’, ‘(da) issue warnings in accordance with Article 9(3);’; (ii) point (g) is replaced by the following: ‘(g) issue opinions to the European Parliament, to the Council, or to the Commission as provided for in Article 16a;’; (iii) the following points are inserted: ‘(ga) issue answers to questions, as laid down in Article 16b; (gb) take action in accordance with Article 9a;’; (d) the following paragraph is added: ‘3. When carrying out the tasks referred to in paragraph 1 and exercising the powers referred to in paragraph 2, the Authority shall act based on and within the limits of the legislative framework and shall have due regard to the principle of proportionality, where relevant, and better regulation, including the results of cost-benefit analyses in accordance with this Regulation. The open public consultations referred to in Articles 10, 15, 16 and 16a shall be conducted as widely as possible to ensure an inclusive approach towards all interested parties and shall allow reasonable time for stakeholders to respond. The Authority shall publish a summary of the input received from stakeholders and an overview of how information and views gathered from the consultation were used in a draft regulatory technical standard and a draft implementing technical standard.’;

(7) Article 9 is amended as follows: (a) paragraph 1 is amended as follows: (i) point (a) is replaced by the following: ‘(a) collecting, analysing and reporting on consumer trends, such as the development of costs and charges of retail financial services and products in Member States;’; (ii) the following points are inserted: ‘(aa) undertaking in-depth thematic reviews of market conduct, building a common understanding of markets practices in order to identify potential problems and analyse their impact; (ab) developing retail risk indicators for the timely identification of potential causes of consumer and investor harm;’; (iii) the following points are added: ‘(e) contributing to a level playing field in the internal market where consumers and other users of financial services have fair access to financial services and products; (f) coordinating mystery shopping activities of competent authorities, if applicable.’; (b) paragraph 2 is replaced by the following: ‘2. The Authority shall monitor new and existing financial activities and may adopt guidelines and recommendations with a view to promoting the safety and soundness of markets, and convergence and effectiveness of regulatory and supervisory practices.’; (c) paragraphs 4 and 5 are replaced by the following: ‘4. The Authority shall establish, as an integral part thereof, a Committee on consumer protection and financial innovation, which brings together all relevant competent authorities and authorities responsible for consumer protection with a view to enhancing consumer protection, achieving a coordinated approach to the regulatory and supervisory treatment of new or innovative financial activities, and providing advice for the Authority to present to the European Parliament, to the Council and to the Commission. The Authority shall closely cooperate with the European Data Protection Board established by Regulation (EU) 2016/679 of the European Parliament and of the Council (^*31) to avoid duplication, inconsistencies and legal uncertainty in the sphere of data protection. The Authority may also invite national data protection authorities as observers in the Committee.

The Authority shall review the decision referred to in the first subparagraph at appropriate intervals and at least every six months. Following at least two consecutive renewals, and based on proper analysis which aims to assess the impact on the customer or consumer, the Authority may decide on the annual renewal of the prohibition. A Member State may request the Authority to reconsider its decision. In that case, the Authority shall decide, in accordance with the procedure set out in the second subparagraph of Article 44(1), whether to maintain that decision. The Authority may also assess the need to prohibit or restrict certain types of financial activity or practice and, where there is such a need, inform the Commission and the competent authorities in order to facilitate the adoption of any such prohibition or restriction.

(8) the following article is inserted: ‘Article 9a No action letters

(a) the Authority considers that provisions contained in such act may directly conflict with another relevant act; (b) where the act is one of the legislative acts referred to in Article 1(2), the absence of delegated or implementing acts that would complement or specify the act in question would raise legitimate doubts concerning the legal consequences flowing from the legislative act or its proper application, (c) the absence of guidelines and recommendations as referred to in Article 16 would raise practical difficulties concerning the application of the relevant legislative act.

In the cases referred to in points (a) and (b) of paragraph 1, the Authority shall provide the Commission with an opinion on any action it considers appropriate, in the form of a new legislative proposal or a proposal for a new delegated or implementing act, and on the urgency that, in the Authority’s judgment, is attached to the issue. The Authority shall make its opinion public. In the case referred to in point (c) of paragraph 1 of this Article, the Authority shall evaluate as soon as possible the need to adopt relevant guidelines or recommendations in accordance with Article 16. The Authority shall act expeditiously, in particular with a view to contributing to the prevention of the issues referred to in paragraph 1, whenever possible.

(9) Article 10 is amended as follows: (a) paragraph 1 is amended as follows: (i) the first subparagraph is replaced by the following: ‘1. Where the European Parliament and the Council delegate power to the Commission to adopt regulatory technical standards by means of delegated acts pursuant to Article 290 TFEU in order to ensure consistent harmonisation in the areas specifically set out in the legislative acts referred to in Article 1(2) of this Regulation, the Authority may develop draft regulatory technical standards. The Authority shall submit its draft regulatory technical standards to the Commission for adoption. At the same time, the Authority shall forward those draft regulatory technical standards for information to the European Parliament and to the Council.’; (ii) the third subparagraph is replaced by the following: ‘Before submitting them to the Commission, the Authority shall conduct open public consultations on draft regulatory technical standards and shall analyse the potential related costs and benefits, unless such consultations and analyses are highly disproportionate in relation to the scope and impact of the draft regulatory technical standards concerned or in relation to the particular urgency of the matter. The Authority shall also request the advice of the relevant Stakeholder Group referred to in Article 37.’; (iii) the fourth subparagraph is deleted; (iv) the fifth and the sixth subparagraphs are replaced by the following: ‘Within three months of receipt of a draft regulatory technical standard, the Commission shall decide whether to adopt it. The Commission shall inform the European Parliament and the Council in due time where the adoption cannot take place within the three-month period. The Commission may adopt the draft regulatory technical standard in part only, or with amendments, where the Union’s interests so require. Where the Commission intends not to adopt a draft regulatory technical standard or to adopt it in part or with amendments, it shall send the draft regulatory technical standard back to the Authority, explaining why it does not adopt it, or explaining the reasons for its amendments. The Commission shall send a copy of its letter to the European Parliament and to the Council. Within a period of six weeks, the Authority may amend the draft regulatory technical standard on the basis of the Commission’s proposed amendments and resubmit it in the form of a formal opinion to the Commission. The Authority shall send a copy of its formal opinion to the European Parliament and to the Council.’; (b) paragraph 2 is replaced by the following: ‘2. Where the Authority has not submitted a draft regulatory technical standard within the time limit set out in the legislative acts referred to in Article 1(2), the Commission may request such a draft within a new time limit. The Authority shall inform the European Parliament, the Council and the Commission, in due time, that it will not comply with the new time limit.’; (c) in paragraph 3, the second subparagraph is replaced by the following: ‘The Commission shall conduct open public consultations on draft regulatory technical standards and analyse the potential related costs and benefits, unless such consultations and analyses are disproportionate in relation to the scope and impact of the draft regulatory technical standards concerned or in relation to the particular urgency of the matter. The Commission shall also request the advice of the relevant Stakeholder Group referred to in Article 37.’; (d) paragraph 4 is replaced by the following: ‘4. The regulatory technical standards shall be adopted by means of regulations or decisions. The words “regulatory technical standard” shall appear in the title of such regulations or decisions. Those standards shall be published in the Official Journal of the European Union and shall enter into force on the date stated therein.’;

(10) in Article 13(1), the second subparagraph is deleted;

(11) Article 15 is amended as follows: (a) paragraphs 1 and 2 are replaced by the following: ‘1. Where the European Parliament and the Council confer implementing powers on the Commission to adopt implementing technical standards by means of implementing acts pursuant to Article 291 TFEU, in the areas specifically set out in the legislative acts referred to in Article 1(2) of this Regulation, the Authority may develop draft implementing technical standards. Implementing technical standards shall be technical, shall not imply strategic decisions or policy choices and their content shall be to determine the conditions of application of those acts. The Authority shall submit its draft implementing technical standards to the Commission for adoption. At the same time, the Authority shall forward those technical standards for information to the European Parliament and to the Council. Before submitting draft implementing technical standards to the Commission, the Authority shall conduct open public consultations and shall analyse the potential related costs and benefits, unless such consultations and analyses are highly disproportionate in relation to the scope and impact of the draft implementing technical standards concerned or in relation to the particular urgency of the matter. The Authority shall also request the advice of the relevant Stakeholder Group referred to in Article 37. Within three months of receipt of a draft implementing technical standard, the Commission shall decide whether to adopt it. The Commission may extend that period by one month. The Commission shall inform the European Parliament and the Council in due time where the adoption cannot take place within the three-month period. The Commission may adopt the draft implementing technical standard in part only, or with amendments, where the Union’s interests so require. Where the Commission intends not to adopt a draft implementing technical standard or intends to adopt it in part or with amendments, it shall send it back to the Authority explaining why it does not intend to adopt it, or explaining the reasons for its amendments. The Commission shall send a copy of its letter to the European Parliament and to the Council. Within a period of six weeks, the Authority may amend the draft implementing technical standard on the basis of the Commission’s proposed amendments and resubmit it in the form of a formal opinion to the Commission. The Authority shall send a copy of its formal opinion to the European Parliament and to the Council. If, on the expiry of the six-week period referred to in the fourth subparagraph, the Authority has not submitted an amended draft implementing technical standard, or has submitted a draft implementing technical standard that is not amended in a way consistent with the Commission’s proposed amendments, the Commission may adopt the implementing technical standard with the amendments it considers relevant or reject it. The Commission shall not change the content of a draft implementing technical standard prepared by the Authority without prior coordination with the Authority, as set out in this Article.

(b) in paragraph 3, the second subparagraph is replaced by the following: ‘The Commission shall conduct open public consultations on draft implementing technical standards and analyse the potential related costs and benefits, unless such consultations and analyses are disproportionate in relation to the scope and impact of the draft implementing technical standards concerned or in relation to the particular urgency of the matter. The Commission shall also request the advice of the relevant Stakeholder Group referred to in Article 37.’; (c) paragraph 4 is replaced by the following: ‘4. The implementing technical standards shall be adopted by means of regulations or decisions. The words “implementing technical standard” shall appear in the title of such regulations or decisions. Those standards shall be published in the Official Journal of the European Union and shall enter into force on the date stated therein.’;

(12) Article 16 is amended as follows: (a) paragraphs 1 and 2 are replaced by the following: ‘1. The Authority shall, with a view to establishing consistent, efficient and effective supervisory practices within the ESFS, and to ensuring the common, uniform and consistent application of Union law, issue guidelines addressed to all competent authorities or all financial institutions and issue recommendations to one or more competent authorities or to one or more financial institutions. Guidelines and recommendations shall be in accordance with the empowerments conferred in the legislative acts referred to in Article 1(2) or in this Article.

(b) the following paragraph is inserted: ‘2a. Guidelines and recommendations shall not merely refer to, or reproduce, elements of legislative acts. Before issuing a new guideline or recommendation, the Authority shall first review existing guidelines and recommendations, in order to avoid any duplication.’; (c) paragraph 4 is replaced by the following: ‘4. In the report referred to in Article 43(5), the Authority shall inform the European Parliament, the Council and the Commission of the guidelines and recommendations that have been issued.’;

(13) the following articles are inserted: ‘Article 16a Opinions

Article 16b

Questions and answers

Before submitting a question to the Authority, financial institutions shall consider whether to address the question in the first place to their competent authority. Before publishing answers to admissible questions, the Authority may seek further clarification on questions asked by the natural or legal person referred to in this paragraph.