Branches of third-country credit institutions

Applicable regulations, conditions for granting authorisations, authorisation procedure and processing times

Article L. 511-10 of the Monetary and Financial Code stipulates that branches of credit institutions established in France having their registered offices in a country that is a party to the agreement on the European Economic Area shall, before exercising their activity, obtain an authorisation from the Autorité de contrôle prudentiel et de résolution (ACPR).

Applicable regulations

See internet page on the Licensing of credit institutions: banks and specialised credit institutions provided that the specific conditions set out below are met.

 

These branches shall be authorised to operate as banks or specialised credit institutions (other than as a mortgage or public loan company or a home loan company), within the limits of the operations that the credit institution to which they are affiliated is authorised to carry out. They may not benefit from the European passport.

Conditions for granting authorisations

The ACPR shall grant an authorisation to a branch of a third country credit institution only if the credit institution to which the branch is affiliated undertakes to carry out, in respect of that branch, tasks equivalent to those which are entrusted to the Board of Directors, the Supervisory Board, or any other body exercising equivalent supervisory functions, as well as to the General Assembly. Branches having been granted authorisation before 22 May 2015 shall have up to 18 months, i.e. until 22 November 2016, to produce such a commitment.

 

The effective management of the activity of these branches shall be carried out by at least two persons in accordance with Article L. 511-13 of the Monetary and Financial Code. If these branches are of significant importance, they shall be required to demonstrate the existence of a risk committee and a remuneration committee or a system to achieve the same objectives, competent for these branches.

 

The ACPR shall also assess the elements that ensure a sound and prudent management of the credit institution. The Authority shall refuse authorisation if the exercise of supervisory powers of the applicant company could either be hindered by capital links or direct or indirect links between the company and other natural or legal persons, or by the existence of legislation or regulations of a country not belonging to the European Economic Area covering one or more of those persons.

 

The ACPR shall also refuse authorisation if the information submitted is incomplete.

Authorisation procedure and processing times

Before starting up activities, you shall:

Branches of third-country credit institutions may be authorised to provide investment services under the same authorisation procedure applicable to French credit institutions wishing to provide investment services.

 

Two copies of the complete application must be submitted (or three if the request includes the provision of investment services). Moreover, an electronic version of the application shall be sent by mail or, if necessary by USB key.

 

After receiving your application, the Authorisation Directorate will examine your request. The decision to grant a credit institution authorisation shall be taken by the ACPR within a maximum of six months as of receipt of the completed application. If the request is incomplete, additional information may be requested and the processing time may be longer. In this case, the time taken for the ACPR to reach its decision may not exceed 12 months as of receipt of the initial request.

Updated on: 03/16/2018 15:37