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The Committee of European Banking Supervisors (CEBS) has published a public consultation on its guidelines on MiFID passport notifications across banking supervisors.
Under MiFID, institutions are given the opportunity of trading across the European Economic Area (EEA – the European Union States plus Norway and Iceland). This authorisation to carry out business is given by the supervisor in the EEA country where that institution, or the relevant subsidiary, is headquartered. The authorisation enables firms to both trade electronically or over the phone in that country and to open branches.
The new guidelines lay down the principles and practicalities for cooperation between EEA supervisory authorities with regards to the new notifications of services and activities provided by credit institutions. In the annexes there are suggested cross-border notification forms including forms to be filled in (in two languages) describing the institution’s activities, plus lists of the authorities and compensation schemes involved.
Opening a branch requires quite detailed information on the branch and its business plan including target markets, how the branch will find and deal with clients, systems and controls including those for liquidity, anti-money laundering and audit, outsourcing plans, safeguarding of client assets and a code of conduct.
The public consultation (open to all interested parties, including supervised institutions and other market participants) closes on the 11th May.
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