Key Benefits:
The Prime Minister,
On the report of the Minister of Economy, Finance and Industry,
Having regard to Directive 2002/87/EC of the European Parliament and the Council of 16 December 2002 on the supplementary monitoring of credit institutions, insurance companies and investment companies owned by a financial conglomerate;
Considering the monetary and financial code (regulatory party);
In light of Order No. 2004-1201 of 12 November 2004 on the supplementary supervision of credit institutions, insurance companies and investment companies owned by a financial conglomerate;
Having regard to the advice of the Advisory Committee on Financial Legislation and Regulation dated 25 February 2005;
The State Council (Finance Section) heard,
Decrete:
Section R. 613-8 of the monetary and financial code is amended as follows:
1° In the first paragraph, after the words: "the sanctions provided for in Article L. 613-32" are inserted the words "and in Article L. 633-12-II".
2° The second paragraph is replaced by the following paragraph: "The representative of the financial company or the financial company holding joint may be assisted by a lawyer."
After section R. 613-13 of the same code, an article R. 613-13-1 is inserted as follows:
"Art. R. 613-13-1. - The procedures set out in section R. 613-10, the first two paragraphs of section R. 613-11 and section R. 613-12 shall apply in the event that the Banking Commission considers, pursuant to section L. 613-18, that it is necessary to designate a provisional administrator in a financial company or a joint holding financial company.
"The representative of the financial company or the financial holding company may be assisted by a lawyer. »
After article R. 511-3 of the same code, an article R. 511-3-1 is created as follows:
"Art. R. 511-3-1. - Before granting special conditions an authorization, issuing an authorization to take part or take control or granting an approval to a credit institution that is:
« 1° Either a subsidiary of an insurance company, a credit institution or an investment company approved in a Member State or a party to the agreement on the European Economic Area;
« 2° Either a subsidiary of the parent company of an insurance company, a credit institution or an investment company approved in a Member State or a party to the European Economic Area Agreement;
« 3° Either an establishment controlled by a person, natural or legal, who also controls an insurance company, credit institution or an investment company registered in a Member State or a party to the European Economic Area Agreement,
the Committee on Credit Institutions and Investment Companies shall consult with the competent authority, within the meaning of 4° I of Article L. 517-2, in order to assess, inter alia, the quality of the shareholders and the honesty and competence of the leaders associated with the management of another entity of the same group.
"This authority has a period of one month to make its observations. This period may be extended for one month upon request. »
In article R. 517-4 of the same code, after the words "financial company" are inserted the words "or a mixed holding company".
In Book VI of the same code, Title III is replaced by:
« TITRE III
"COOPERATION AND EXCHANGE OF INFORMATION
TO THE COMPLETED MONITORING
"Art. R. 631-1. - When the head entity of a financial conglomerate, whose bank commission is the coordinator, has its head office in another Member State or another State Party to the agreement on the European Economic Area, the Banking Commission may invite the competent authorities of that State, on the one hand, to request that entity to provide them with all information relevant to the fulfilment of its coordination mission, as defined in Article L-3.
"The Banking Commission shall, at the request of a coordinator of another Member State or another State Party to the Agreement on the European Economic Area, communicate any information useful to the fulfilment of the mission of that coordinator referred to in Article L. 633-4.
"Art. R. 631-2. - The Banking Commission cooperates closely with other competent authorities to ensure the effectiveness of the sanctions or measures it has adopted pursuant to Articles L. 633-12 and L. 633-13.
"Art. R. 631-3. - When the Banking Commission is the audit authority referred to in Article L. 633-14, it consults with other relevant authorities. It also consults, before making a decision, the Committee of Financial Conglomerates under Article 21 of Directive 2002/87/EC of the European Parliament and of the Council of 16 December 2002 to take into account the guidelines developed by this Committee.
"Art. R. 631-4. - Cooperation between competent authorities provided for in Article L. 633-5 shall be carried out under the following conditions:
« 1° Without prejudice to their respective responsibilities, any competent authority shall communicate, on its own initiative or at the request of another competent authority, any useful information that would enable the latter to exercise its prudential functions, as part of the complementary monitoring of financial conglomerates.
"The competent authorities collect and exchange information that contributes to the exercise of this complementary monitoring. This information includes the structure of the group, the main entities of the financial conglomerate and the competent authorities of these regulated entities, the financial conglomerate strategy and its financial situation, as well as its major shareholders and leaders, the risk management system and the internal control system. They also relate to procedures for collecting and verifying information from the entities of the financial conglomerate, the difficulties encountered by them, as well as the major sanctions and exceptional measures taken against them by the competent authorities.
« 2° Without prejudice to their respective responsibilities, prior to making a decision that might arise from the prudential functions of other competent authorities, the competent authorities concerned shall consult and exchange information on the structural modification of the shareholding, on the organization or management of the regulated entities of a financial conglomerate requiring the approval or authorization of the competent authorities, as well as on the main sanctions and exceptional measures envisaged by the competent authorities.
"In the event of an emergency, or where such consultation may jeopardize the effectiveness of the decision, a competent authority may decide not to consult with its counterparts, subject to prompt notification of that decision. »
The first paragraph of section R. 532-8 of the same code is replaced by the paragraphs as follows:
"Before issuing special conditions an authorization, issuing an authorization to take part or take control, or granting an approval to an investment company that is:
« 1° Either a subsidiary of an insurance company, a credit institution or an investment company approved in a Member State or a party to the agreement on the European Economic Area;
« 2° Either a subsidiary of the parent company of an insurance company, a credit institution or an investment company approved in a Member State or a party to the European Economic Area Agreement;
« 3° Either a company controlled by a person, physical or legal, who also controls an insurance company, a credit institution or an investment company registered in a Member State or a party to the agreement on the European Economic Area,
the Committee on Credit Institutions and Investment Enterprises shall consult, on its own initiative or at the request of the Autorité des marchés financiers, the competent authority, within the meaning of 4° of Article L. 517-2, in order to assess, inter alia, the quality of the shareholders and the honesty and competence of the leaders associated with the management of another entity of the same group.
"This authority has a period of one month to make its observations. This period may be extended for one month upon request. »
The first paragraph of section R. 532-15 of the same code is replaced by the paragraphs as follows:
"Before issuing special conditions an authorization, issuing an authorization to take part or take control, or granting an approval to an investment company that is:
« 1° Either a subsidiary of an insurance company, a credit institution or an investment company approved in a Member State or a party to the agreement on the European Economic Area;
« 2° Either a subsidiary of the parent company of an insurance company, a credit institution or an investment company approved in a Member State or a party to the European Economic Area Agreement;
« 3° Either a company controlled by a person, natural or legal, who also controls an insurance company, a credit institution or an investment company registered in a Member State or a party to the European Economic Area Agreement,
the Autorité des marchés financiers consults with the competent authority, within the meaning of 4° of the I of Article L. 517-2, in order to assess, inter alia, the quality of the shareholders and the honesty and competence of the leaders associated with the management of another entity of the same group.
"This authority has a period of one month to make its observations. This period may be extended for one month upon request. »
The Minister of Economy, Finance and Industry is responsible for the execution of this Order, which will be published in the Official Journal of the French Republic.
Done in Paris, September 19, 2005.
Dominique de Villepin
By the Prime Minister:
Minister of Economy,
finance and industry,
Thierry Breton
