Directive (EU) 2019/2177 of the European Parliament and of the Council of 18 December 2019 amending Directive 2009/138/EC on the taking-up and pursuit of the business of Insurance and Reinsurance (Solvency II), Directive 2014/65/EU on markets in financial instruments and Directive (EU) 2015/849 on the prevention of the use of the financial system for the purposes of money-laundering or terrorist financing (Text with EEA relevance)
Directive (EU) 2019/2177 of the European Parliament and of the Councilof 18 December 2019amending Directive 2009/138/EC on the taking-up and pursuit of the business of Insurance and Reinsurance (Solvency II), Directive 2014/65/EU on markets in financial instruments and Directive (EU) 2015/849 on the prevention of the use of the financial system for the purposes of money-laundering or terrorist financing(Text with EEA relevance)THE EUROPEAN PARLIAMENT AND THE COUNCIL OF THE EUROPEAN UNION,Having regard to the Treaty on the Functioning of the European Union, and in particular Article 53(1) and 62 thereof,Having regard to the proposal from the European Commission,After transmission of the draft legislative act to the national parliaments,Having regard to the opinion of the European Central BankOJ C 251, 18.7.2018, p. 2.,Having regard to the opinion of the European Economic and Social CommitteeOJ C 227, 28.6.2018, p. 63.,Acting in accordance with the ordinary legislative procedurePosition of the European Parliament of 16 April 2019 (not yet published in the Official Journal) and decision of the Council of 2 December 2019.,Whereas:(1)Directive 2014/65/EU of the European Parliament and of the CouncilDirective 2014/65/EU of the European Parliament and of the Council of 15 May 2014 on markets in financial instruments and amending Directive 2002/92/EC and Directive 2011/61/EU (OJ L 173, 12.6.2014, p. 349). creates a regulatory framework for data reporting services providers (DRSPs) and requires a post-trade data reporting services provider to be authorised as an approved publication arrangement (APA). In addition, a consolidated tape provider (CTP) is required to offer consolidated trading data covering all trades in both equity and non-equity instruments throughout the Union, in accordance with Directive 2014/65/EU. Directive 2014/65/EU also formalises transaction reporting channels to the competent authorities by requiring a third party that reports on behalf of investment firms to be authorised as an approved reporting mechanism (ARM).(2)The quality of trading data and of the processing and provision of such data, including cross-border data processing and provision, is of paramount importance for achieving the main objective of Regulation (EU) No 600/2014 of the European Parliament and of the CouncilRegulation (EU) No 600/2014 of the European Parliament and of the Council of 15 May 2014 on markets in financial instruments and amending Regulation (EU) No 648/2012 (OJ L 173, 12.6.2014, p. 84)., which is to strengthen the transparency of financial markets. Accurate trading data provide users with an overview of trading activity across Union financial markets and provide competent authorities with accurate and comprehensive information on relevant transactions. Given the cross-border dimension of data handling, the benefits of pooling data-related competences, including potential economies of scale, and the adverse impact of potential divergences in supervisory practices on both the quality of trading data and on the tasks of DRSPs, it is therefore appropriate to transfer the authorisation and supervision of DRSPs, as well as data gathering powers, from the competent authorities to the European Supervisory Authority (European Securities and Markets Authority) established by Regulation (EU) No 1095/2010 of the European Parliament and of the CouncilRegulation (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). (ESMA), other than with respect to ARMs or APAs that benefit from a derogation under Regulation (EU) No 600/2014.(3)To achieve the consistent transfer of such powers, it is appropriate to delete provisions pertaining to the operational requirements for DRSPs and the competences of competent authorities with respect to DRSPs set out in Directive 2014/65/EU, and to introduce those provisions in Regulation (EU) No 600/2014.(4)The transfer of the authorisation and supervision of DRSPs, other than with respect to APAs or ARMs that benefit from a derogation under Regulation (EU) No 600/2014, to ESMA is congruent with ESMA’s tasks. More specifically, the conferral of data gathering powers, authorisation and supervision from competent authorities to ESMA is instrumental to other tasks that ESMA performs under Regulation (EU) No 600/2014, such as market monitoring, temporary intervention powers and position management powers, and ensures consistent compliance with pre-trade and post-trade transparency requirements.(5)Directive 2009/138/EC of the European Parliament and of the CouncilDirective 2009/138/EC of the European Parliament and of the Council of 25 November 2009 on the taking-up and pursuit of the business of Insurance and Reinsurance (Solvency II) (OJ L 335, 17.12.2009, p. 1). provides that, in accordance with the risk-oriented approach to the Solvency Capital Requirement, it is possible in specific circumstances for insurance and reinsurance undertakings and groups to use internal models for the calculation of that requirement, instead of using the standard formula.(6)Directive 2009/138/EC provides for a country component in the volatility adjustment. In order to ensure that this country component mitigates exaggerations of bond spreads in the relevant country effectively, an appropriate threshold for the risk-corrected country spread should be set for the activation of the country component.(7)In view of increased cross-border insurance activities, it is necessary to enhance the convergent application of Union law in cases of cross-border insurance activity, especially at an early stage. For this purpose, information exchange and cooperation between supervisory authorities and the European Supervisory Authority (European Insurance and Occupational Pensions Authority) established by Regulation (EU) No 1094/2010 of the European Parliament and of the CouncilRegulation (EU) No 1094/2010 of the European Parliament and of the Council of 24 November 2010 establishing a European Supervisory Authority (European Insurance and Occupational Pensions Authority), amending Decision No 716/2009/EC and repealing Commission Decision 2009/79/EC (OJ L 331, 15.12.2010, p. 48). (EIOPA), should be strengthened. In particular, notification requirements in the case of significant cross-border insurance activity or a crisis situation, as well as conditions for setting up cooperation platforms, should be provided for where the envisaged cross-border insurance activity is significant. The significance of the cross-border insurance activity should be assessed in terms of the annual gross written premium subscribed in the host Member State compared to the total annual gross written premiums of the insurance company, in terms of the impact on the policyholder protection in the host Member State and in terms of the impact of the branch or activity of the respective insurance company on the market of the host Member State in terms of freedom to provide services. Cooperation platforms are an effective tool to achieve stronger and timely cooperation between supervisory authorities and thus to enhance consumer protection. However, authorisation, supervision and enforcement decisions are and remain within the competence of the supervisory authority of the home Member State.(8)Where cross-border insurance activities are significant with respect to the market of the host Member State and require close collaboration between the supervisory authorities of the home Member State and the host Member State, especially where an insurer might risk being in financial difficulties to the detriment of policyholders and third parties, EIOPA should set up and coordinate collaboration platforms.(9)To take account of the replacement of the Committee of European Insurance and Occupational Pensions Supervisors (CEIOPS) by EIOPA, the references to CEIOPS in Directive 2009/138/EC should be deleted.(10)Following changes to Regulation (EU) No 1093/2010 of the European Parliament and of the CouncilRegulation (EU) No 1093/2010 of the European Parliament and of the Council of 24 November 2010 establishing a European Supervisory Authority (European Banking Authority), amending Decision No 716/2009/EC and repealing Commission Decision 2009/78/EC (OJ L 331, 15.12.2010, p. 12)., the European Supervisory Authority (European Banking Authority), established by that Regulation (EBA), will have a new role in the prevention of the use of the financial system for the purposes of money laundering or terrorist financing, and subsequent changes will need to be made to Directive (EU) 2015/849 of the European Parliament and of the CouncilDirective (EU) 2015/849 of the European Parliament and of the Council of 20 May 2015 on the prevention of the use of the financial system for the purposes of money laundering or terrorist financing, amending Regulation (EU) No 648/2012 of the European Parliament and of the Council, and repealing Directive 2005/60/EC of the European Parliament and of the Council and Commission Directive 2006/70/EC (OJ L 141, 5.6.2015, p. 73)..(11)Directives 2009/138/EC, 2014/65/EU and (EU) 2015/849 should therefore be amended accordingly,HAVE ADOPTED THIS DIRECTIVE: