Royal Decree 1332 / 2005 Of 11 November, Which Develops Law 5/2005, Of 22 April, Supervision Of Financial Conglomerates And Amending Other Laws In The Financial Sector.

Original Language Title: Real Decreto 1332/2005, de 11 de noviembre, por el que se desarrolla la Ley 5/2005, de 22 de abril, de supervisión de los conglomerados financieros y por la que se modifican otras leyes del sector financiero.

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Law 5/2005, of 22 April, supervision of financial conglomerates and by which amending other laws in the financial sector, responds to two main objectives: the establishment of a system of supplementary supervision for financial conglomerates and the review of the sectoral rules (banking, securities and insurance) for proper coherence between all of them and align with the new regime of financial conglomerates.

The Act incorporates part into our domestic Directive 2002/87/EC of the European Parliament and of the Council of 16 December 2002, concerning the supervision of credit institutions, insurance companies and entities from investment belonging to a financial conglomerate, which directives amending 73/239/EEC 79/267/EEC, 92/49/EEC, 92/96/EEC, 93/6/EEC and 93/22/EEC of the Council and directives 98/78/EC and 2000/12/EC of the European Parliament and of the Council. Community rules must be framed within the scope of the actions of the Action Plan for financial services which in their quest for the achievement of a single market in financial services established within its objectives the need for reinforcement of the structures precautionary. This line of action, the Green Book of financial services (2005-2010), which establishes the criteria of convergence for the next five years, maintains among its objectives the establishment of efficient and effective supervision through the transposition, implementation and ongoing evaluation of the directives set out in the plan of action.

However, the law established a partial transposition of the directive, which must be completed by this Royal Decree, under the enabling the Government for regulatory development that made the second final provision of the law.

Chapter I of the Royal Decree is dedicated to the establishment of the scope of the regulation, with the delimitation of the entities subject to the supplementary supervision regime, form of identification and the determination of the relevant competent authorities. In this regard, should be a special reference to the existence in Spain since 1995 of a supervisory regime for what our legal system called "not consolidated mixed groups"; in this sense, the Royal Decree adapts its regime of information in the line set by the regulation of the law 5/2005, of 22 April, which allowed the Government to extend all or some of the obligations laid down for financial conglomerates not consolidated mixed groups failing the requirement of diversification sectoral significant.

Chapter II establishes the elements that will comprise the supplementary supervision: adequacy of capital, intra-group transactions, policy concentration and risk management, mechanisms of internal control and good repute and experience of managers of mixed financial holding companies.

Chapter III provides will carry out the designation of the Coordinator of the supervision of the conglomerate, completing his performance through the identification of the financial conglomerate and of the obliged entity. Also, regulates cooperation between the competent authorities linked to the same financial conglomerate.

Chapter IV contains performances by the Coordinator in cases of breach of the obligations established by law and by this Royal Decree.

Chapter V designates enabling legislation which will enjoy the various supervisors to develop methods of additional supervision of groups whose parent is a regulated entity or a mixed financial holding company which is domiciled outside the European Union.

Final provisions establish the review of the sectoral rules (banking, securities and insurance), regulatory range, for proper coherence between all of them and align with the new regime of financial conglomerates. These provisions also serve two purposes of this Royal Decree: firstly, the transposition of Directive 2005/1/EC of the European Parliament and of the Council of 9 March 2005, by which the Council Directives 73/239/EEC, 85/611/EEC, 91/675/EEC, 92/49/EEC and 93/6/EEC and directives 94/19/EC amending 98/78/EC, 2000/12/EC, 2001/34/EC, 2002/83/EC and 2002/87/EC, in order to establish a new organizational structure for financial services committees, which extends certain obligations of information in the field of credit and insurance institutions; and, secondly, the establishment of common requirements of commercial and professional repute for a series of supervised entities (which will include currency exchange establishments and societies of pricing), which seeks to correct the existing conceptual dispersion so far.

Also in the insurance field are used the policy changes included in the final provisions to establish an adequacy of the assessment of the properties of the insurance entities.

By virtue, on the proposal of the Minister of economy and finance, according to the Council of State and after deliberation by the Council of Ministers at its meeting of November 11, 2005, available: chapter I General provisions article 1. Object.

This Royal Decree aims to develop provisions in law 5/2005, of 22 April, supervision of financial conglomerates and why amending other laws in the financial sector (hereinafter the law).

Article 2. Scope of application.

1. without prejudice to the provisions relating to the supervision of groups of financial institutions collected in the sectoral regulations, the regulated entities in the financial conglomerate shall be subject to all obligations provided for in this Royal Decree and its development provisions.

(2 groups that meet all the requirements provided for in articles 2 and 3 of the Act, except for that laid down in its article 2.1. c), will be subject to the provisions of article 13.2 of this Royal Decree relating to the obligations of information. Also, will you apply articles 5, 6 and 7 of the Act.

(3. in groups that referred to in the last subparagraph of the second paragraph of article 2(5) of the Act, the Coordinator and the relevant competent authorities may decide, by common accord: a) that are not subject to all the obligations laid down in chapter II; in such a case shall be their application as provided in the preceding paragraph.

(b) they are subject only to the obligations laid down in article 6.

The indicated authorities may take decisions referred to in this section if they consider that the implementation of all the obligations laid down in this Royal Decree is not necessary, or is inadequate, or it could mislead with respect to the objectives of the supervision of additional, taking into account: 1 the size of the financial sector of lower dimension, especially if it is not greater than five percent calculated in accordance with the medium to which refers article 2(5) of the Act, or in terms of balance sheet total or the financial sector solvency requirements.

2nd its market share, especially if it is not superior to 5% in any Member State, in terms of balance sheet total in the banking sector and the investment services and in terms of gross premiums issued in the insurance sector.

4. in the case of regulated entities referred to in article 4.4 of the Act, in which one or more natural or legal persons hold participations or capital ties or exert a significant influence, the relevant competent authorities may, by mutual agreement, require compliance with all or any of the obligations laid down in this chapter as if the regulated entities constitute a financial conglomerate, provided that at least one of the companies belong to the insurance and other banking and investment services sector and that both sectors are significant within the meaning of article 2(5) of the Act.

To make the corresponding decision, cited authorities must take into consideration the following factors: a) the possibility that cited people could assume, in fact or in law, whether by virtue of contractual agreements or of any other legal link, sufficient powers to, with independence to exercise or not, set the strategy or how to manage the business of the regulated entities , or designate at least one third of the members of the Board of Directors of the above-mentioned entities.

(b) the existence between regulated entities of interrelations economic, based, inter alia, in direct, indirect or reciprocal financial support, or other analogues which involve a substantial financial or economic dependence.

(c) in the case of cooperative or mutual, groups based on partners, direct or indirect, that would be common to credit unions or affected social welfare mutuals.

Article 3. Financial institutions and financial sector.

1 a the effects of this Royal Decree and provisions in article 2.4 of the Act, will be deemed to be part, in any case, the financial sector of a group the following entities: to) the regulated entities referred to in article 2(3) of the Act.

(b) financial mixed holding companies provided for in article 2.7 of the law.

(c) venture capital corporations and the management companies of venture capital entities.

(d) variable capital investment companies.


(e) entities whose main activity is the holding of shares or participations; means that the main activity of an entity is holding of shares when, on the date on which said the consolidated financial statements, more than half of its assets is composed of long-term financial investments in capital, whatever the activity, purpose or status of portfolio entities.

(f) the instrumental societies whose activity involves the extension of the business of a financial institution, or mainly consist of providing the ancillary services group entities, such as possession of immovable property or active materials, providing computer services, valuation, representation, mediation, or other similar.

2. the banking and investment services sector shall consist of credit institutions and the financial conglomerate investment services companies, as well as other entities that integrate a group or subgroup consolidatable of banks or a group or consolidatable subgroup of investment services companies.

Insurance consists of insurance and reinsurance entities in the financial conglomerate, as well as other entities that integrate a group or subgroup consolidatable of insurance companies.

For the above purposes, will be applicable as provided for in article 6(4) of the Royal Decree 1343 / 1992, of November 6, which develops the law 13/1992 of June 1, own resources and supervision on a consolidated basis of the financial institutions.

Article 4. Rules applicable to the calculations necessary to identify financial conglomerates.

1. the calculations referred to in article 2 of the law will be held once a year in all groups in which at least one of the entities of the Group belong to the insurance and at least one banking and investment services sector.

2 calculations in relation to the balance will be made on the basis of the aggregated balance sheet total of the entities of the group, according to their annual accounts. However, when consolidated accounts are available and they provide separate data for the sectors referred to in the previous article, made with allocation criteria equivalent to those listed in it, will be used these instead of aggregated accounts. For the purposes of these calculations, companies that has possess shares shall be taken into account by the amount of the balance sheet total corresponding to the proportional part added in possession of the group, provided that these companies are not included in the figures of the sector which must integrate and consolidated accounts or when used not used.

3 the relevant competent authorities may by common agreement: to) exclude an entity to carry out the calculations referred to in paragraphs 4 and 5 of article 2 of the law, in the same cases referred to in article 6(4) of this Royal Decree.

(b) take into account to comply with the thresholds provided for in the law for three consecutive years, to avoid sudden changes of regime and stop taking into account this circumstance if the structure of the group undergoes significant changes.

For already identified as financial conglomerates earlier decisions shall be made based on a proposal by the Coordinator of the conglomerate.

4. the relevant competent authorities may, in exceptional cases and by common agreement, the decision provided for in article 2.6 of the Act when they deem that the parameters referred to in the aforesaid article are especially important for the purposes of supplementary supervision.

Article 5. Relevant competent authorities.

For the purposes of the provisions of this Royal Decree, will be relevant competent authorities: to) the competent Spanish or authorities from other Member States of the European Union who are responsible for supervision on a consolidated basis of the regulated entities in a financial conglomerate.

((b) the coordinator appointed pursuant to the provisions of article 14 in the case that it is different from the authorities referred to in paragraph to) above.

(c) other competent authorities concerned, when so decide by common agreement the authorities referred to in the two preceding paragraphs; for this purpose, they shall take into consideration especially the market share of the regulated entities of the conglomerate in other Member States of the European Union, in particular if it is higher than five percent, as well as the importance that any regulated entity established in another Member State in the conglomerate.

(d) if it is a financial conglomerate whose foreign regulated entities do not belong to another Member State of the European Union, the Bank of Spain if it were included in the financial conglomerate a credit institution Spanish; the National Commission of the stock market in the conglomerate a company of services of the General Directorate of insurance and pension funds and investment Spanish was included if it were included in the financial conglomerate an insurance or reinsurance entity Spanish.

Chapter II supplementary supervision article 6 elements. Additional capital adequacy requirements.

1. in cases where the parent of the conglomerate is a Spanish regulated entity or when all the relevant competent authorities are Spanish, the rules laid down in paragraphs 3 and 4 of this article shall apply.

In cases other than those provided for in this paragraph 1, the Coordinator shall decide, after consultation with the other relevant competent authorities and the obliged entity in the financial conglomerate, according to which method described in the annex shall be calculated requirements of the regulated entities in the financial conglomerate capital adequacy.

2 Computable equity in the financial conglomerate shall include the result of the sum of: to) Computable equity of the credit institution or consolidatable group of credit institutions, which form part of the financial conglomerate, as they are defined in chapter II of title I of the Royal Decree 1343 / 1992, of November 6, and its implementing regulations.

(b) the Computable equity of the utility of investment or consolidatable group of these, forming part of the financial conglomerate, as they are defined in chapter II of title II of the Royal Decree 1343 / 1992, of November 6, and its implementing regulations.

(c) the unencumbered own assets of the insurance company or consolidatable group of insurance companies, which form part of the financial conglomerate, as it is defined in the regulation of management and supervision of private insurance, approved by Royal Decree 2486 / 1998, dated 20 November.

That sum shall be deducted: 1 the shareholdings between entities in the financial conglomerate, unless the amount has been already eliminated by consolidation or deducted from Computable equity of consolidated members of those groups / entities. The deductions shall be made by the value in the books of the entity holding such shares.

2. the surplus, where appropriate, those elements of Computable equity or own unencumbered assets that do not have such consideration according to the rules applicable to individual financial institutions or consolidated financial groups supervised by the Spanish authority who acts as coordinator of the financial conglomerate, on own resources or unencumbered heritage requirements minimum of the individual financial institution or consolidatable group in which are Computable. To determine such excess they will be applied first, there, computable equity of lesser quality in accordance with the applicable sectoral legislation, and will be distributed pro rata to those requirements covered by the own resources of the same group of the elements to exclude.

The coordinator may establish that the amount of those operations or financial commitments that are carried out, be deducted from effective financial conglomerate's own resources between the different financial institutions belonging to the conglomerate that are not consolidated among them, between any of the financial of the Group entities and any third party, that generate a doubling in the computation of the own resources of the financial conglomerate or undermine the effectiveness of the resources to cover loss or deal with the risks assumed by the financial conglomerate as a whole.

3 own resources effective in the financial conglomerate, once made the deductions provided for in the preceding paragraph, shall not be less in any moment to the sum of the demands of equity and solvency margin established, according to its specific rules, for each class of entities or consolidated groups integrated in the financial conglomerate.

When assets covering participations and other internal operations between unconsolidated entities belonging to the financial conglomerate involve demands for resources to any of them, or in your case, your consolidatable group, such requirements will not be taken into account in the calculation of the requirements of minimal own resources of the financial conglomerate. Deducted assets of own resources will not be considered in the calculation of the requirements of minimal own resources of the financial conglomerate.

4. the coordinator may decide not to include a particular entity in the calculation of the adequacy requirements of the additional capital in the following cases:


(a) If is the entity situated in a third country where there are legal impediments to the transfer of the necessary information.

(b) where the entity considered individually present an insignificant interest in attention to the objectives of supplementary supervision. As several companies of the group in these circumstances, not may be excluded rather than as a whole show a little significant interest for the expressed purpose.

(c) when may the inclusion of the entity be inadequate or misleading in relation to the objectives of supplementary supervision. In this case, and unless urgent situations, the Coordinator shall consult the other relevant competent authorities before making the decision.

(When a regulated entity be excluded according to the provisions of paragraphs b) and (c)), the competent authority responsible for their individual supervision may ask the obliged entity in the financial conglomerate of information that can facilitate the supervision of the regulated entity.

5. the solvency requirements referred to in this article shall be calculated in accordance with the corresponding sectoral rules.

Article 7. Technical principles of capital adequacy.

1. both in the cases referred to in paragraph 2 as those laid down in paragraph 5 of the article above, and regardless of the method used in the latter case, shall apply the technical principles set out in this article.

2 whatever the method used, when the entity is a subsidiary and has a deficit of solvency or, in the case of a non-regulated financial sector entity, a theoretical solvency deficit, must be taken into account the total deficit of solvency of the subsidiary. If in this case, in the opinion of the Coordinator, the responsibility of the dominant company that owns part of the capital is limited strictly and clearly to that share of the capital, the coordinator may allow the dependent solvency deficit is taken into account on a proportional basis.

In cases where there are no capital ties between entities in a financial conglomerate, the Coordinator, after consultation with the other relevant competent authorities, shall determine which proportional share will have to consider, taking into account the liability the existing ties.

3 in addition, the following principles shall be taken into consideration: to) multiple computation of allowable elements must be disposed of to calculate own resources within the financial conglomerate, as well as any inappropriate creation of own resources in the interior of the Group; to ensure the Elimination of multiple gearing and the creation of own resources in the interior of the group, the competent authorities shall apply by analogy the relevant principles laid down in the sectoral rules.

(b) the solvency requirements of the financial sector represented in a financial conglomerate shall be covered by elements of own resources in accordance with the corresponding sectoral rules; When there is a deficit of own resources referred to the financial conglomerate, only items of own resources that are eligible for each of the sectoral rules shall be taken into account to verify compliance with the additional requirements of solvency.

(c) when sectoral standards establish limits of admissibility of certain instruments of the own resources that could be considered cross-sector capital, these limits shall similarly apply to calculating own resources referred to the financial conglomerate.

(d) calculating own resources at the level of the financial conglomerate, competent authorities shall take into account also the effectiveness of the transferability and availability of own resources among different legal entities of the group, whereas the objectives of the capital adequacy standards.

(e) in the case of a non-regulated financial sector entity, when calculating a notional solvency requirement in accordance with the provisions of the annex, shall mean notional solvency requirement the capital requirement that the entity should meet standards, sectoral or General, relevant, if a regulated entity in the financial sector. The notional solvency requirement of a mixed financial holding company shall be calculated according to the sectoral rules corresponding to the most important financial sector in the financial conglomerate.

Article 8. Intra-group transactions.

1. forced authorities of financial conglomerates shall inform the Coordinator, with the frequency determined by this, that it should be at least annual, on any operation significant intra-group transactions of regulated entities in the financial conglomerate.

2. for the purposes referred to in the preceding paragraph, intra-group operation means any operation or legal business, regardless of its nature, that relate directly or indirectly to the regulated entities in a financial conglomerate with other companies of the same group or with any physical or legal person closely linked to the companies of the group for the performance of an obligation whether or not contractual, whether or not intended a payment.

3. without prejudice to the provisions of article 10, is considered significant to any operation intra-group higher amount to five per cent of Computable equity of the financial conglomerate.

Article 9. Concentration of risks.

1. forced authorities of financial conglomerates shall inform the Coordinator, with the frequency determined by this, that it should be at least annual, on any significant concentration of risks in the financial conglomerate.

2. for the purposes referred to in the preceding paragraph, means concentration of risk any exposure that may result in losses borne by entities within a financial conglomerate that is important enough to commit the solvency or the financial position in general of the regulated entities in the financial conglomerate. These exposures may arise from risks counterpart or of credit, investment risk, insurance risk, market risk or other risks, or a combination or interaction of these.

3. without prejudice to the provisions of the following article, they shall be regarded as concentration risks significant those exceeding 10 per cent of Computable equity of the financial conglomerate.

Article 10. Provisions common to the intra-group transactions and risk concentrations.

1. the Coordinator, after consultation with the other relevant competent authorities, shall identify the types of operations and risks on which regulated entities in the financial conglomerate shall inform, pursuant to the provisions of the two preceding articles, as well as the criteria for the evaluation of such operations and risks and other technical ends that must be taken into account for the calculations.

To do this, cited authorities shall take account of the particular characteristics of each financial conglomerate and its risk management structure.

2. the Coordinator, after consultation with the other relevant competent authorities and the own conglomerate, can define thresholds of significance smaller than those set forth in the two preceding articles for each specific case.

3 reviewing the intra-group transactions and risk concentrations, the Coordinator shall consider especially the possible risk of contagion in the financial conglomerate, the risk of conflict of interest, the risk of circumvention of sectoral rules and the level or volume of risks.

4 empowers the Minister of finance to establish a general rule, following a report from the Bank of Spain, the National Commission of the stock market and the General Directorate of insurance and pension funds, quantitative limits and requirements qualitative relating to intra-group transactions and significant risk concentrations to which this article refers.

Article 11. Risk management and internal control.

1. the regulated entities in the financial conglomerate must have at the level of the financial conglomerate adequate internal control mechanisms and risk management procedures, as well as a good administrative and accounting organization.

2 risk management procedures will include: a) sound governance and management that have approval and periodic review by the whole of the managing bodies of the entities included in the cluster.

(b) capital adequacy of appropriate policies to anticipate the impact of their business strategy on the profile of risks and requirements for additional capital in the financial conglomerate.

(c) appropriate procedures to ensure that its risk control systems are integrated in your organization and to take the necessary measures to ensure that the systems applied in all institutions belonging to the financial conglomerate are consistent and that risks can be measured, followed and controlled at the level of the financial conglomerate.

3 internal control mechanisms shall include: a) adequate mechanisms in relation to the additional capital adequacy to identify and calculate all the risks of significant, internal and external, to which the entity is exposed, and establish a relationship appropriate between own resources and risks.

(b) information and procedures accounting solid, to identify, measure, track, and control operations the risk concentration and intra-group.


4 taking into account the particular characteristics of each financial conglomerate, the coordinator may, heard the other competent relevant authorities, determine the scope and content of the procedures of risk management and internal control mechanisms that must have the financial conglomerate, those referred to in paragraphs 2 and 3.

5. all the companies included in a financial conglomerate must have adequate internal control mechanisms to collect data and information relevant for the purposes of supplementary supervision.

Article 12. Requirements of the administrators of mixed financial holding companies.

1. the members of the Board of Directors of financial mixed holding companies, including individuals representing legal persons who are directors, shall be persons of recognized commercial and professional repute and must possess, at least most, knowledge and experience appropriate to exercise its functions. Such honesty, knowledge and experience must also concur in general or assimilated society directors.

2 attend commercial and professional repute who have been observing a personal history of respect for the commercial law or other governing economic activity and the life of the business, as well as commercial, financial and banking practices. In any case, means lacking such repute who, in Spain or overseas, have criminal records for intentional crimes, are disabled to exercise public or administrative or financial institutions address charges or are disabled by law 22/2003, of July 9, bankruptcy, while it is not completed the period of disqualification set out in the statement of qualification of the contest and the broken and processed not rehabilitated in previous bankruptcy procedures to the entry into force of the aforementioned law.

3 they possess appropriate knowledge and experience to perform their functions on mixed financial holding companies who have played, for a period not less than three years, functions of senior management, direction, control or advice on financial entities or functions of similar responsibility in other public or private entities of dimension at least similar to the of the regulated entities in the financial conglomerate.

4. the obliged entity in the financial conglomerate shall contact the Coordinator to communicate the status of administrator or director of persons referred to in this article and apply for registration in a special register which keeping will correspond to the Coordinator. This communication will take place within 15 days of acceptance of the charge, including personal and professional data set, in General, the Coordinator responsible for registration, as well as document of acceptance of office and Declaration of those affected that meet the requirements of good repute and, where appropriate, experience which this article refers, and which are not in any restrictions or incompatibility established in any rule that was les application.

Article 13. Obligation of information.

1. forced authorities of financial conglomerates shall send to the Coordinator information, periodic or not, that this requires them to verify the fulfilment of their obligations. They must also meet the requirements of the Coordinator and facilitate, where appropriate, Commission actions, all without prejudice that the competent authorities in the supervision of entities or groups in the conglomerate may go directly to them in the exercise of its powers of individual supervision or consolidated basis of institutions belonging to the conglomerate.

2. in the case of the groups referred to in article 2(2) of this Royal Decree, the obliged entity shall be sent to all the competent authorities relevant Spanish information requiring to them by the authority responsible for the supervision of the obliged entity in relation to the calculations provided for in article 2 of the Act, for the purposes of check not to subject the group to the obligations relating to the supplementary supervision , and in relation to the calculation of the additional capital that could eventually be payable if you acquire the condition of financial conglomerate.

The entity obliged to that referred to in the preceding paragraph shall be that appropriate application of criteria analogous to those provided for in article 5(5) of the Act.

Chapter III exercise of the supplementary supervision article 14. Rules Coordinator designation.

1 when the dominant entity within a financial conglomerate is a Spanish regulated entity, the task of coordinator shall be exercised by the competent authority that has assigned the functions of monitoring and supervision of consolidatable group in which it is integrated, or, in absence thereof, of the entity considered individually.

2. in cases other than the provisions of the preceding paragraph, the task of coordinator shall be exercised by the competent authority responsible for the supervision of the Spanish regulated entity with the largest balance sheet total in the most important financial sector.

3. the relevant competent authorities may by common agreement not applied the criteria laid down in paragraph 2 if their application is inadequate, taking account of the structure of the conglomerate and the relative importance of its activities in different countries, and appoint as Coordinator to a different competent authority. In these cases, before adopting its decision, the competent authorities give the conglomerate, through the obliged entity, the opportunity to speak out about the decision.

Article 15. Identification of the financial conglomerate and the obliged entity.

1. the Bank of Spain, the National Commission of the stock market and the General Directorate of insurance and pension funds shall cooperate closely with each other and with other competent authorities to identify the conglomerates financial which, in his case were included Spanish entities. For this purpose, they can head to regulated entities that are under its jurisdiction to collect them, if not in its possession, the necessary information to carry out such identification work.

2 identified a financial conglomerate, the Coordinator shall inform the obliged entity financial conglomerate referred to in article 5(5) of the Act, such circumstances, of their status as Coordinator, as well as the scope of the obligations of the conglomerate as provided for in paragraph first of article 2.1 of this Royal Decree.

Identical procedure shall be followed, for the purposes of the provisions of article 13, with respect to the groups referred to in article 2(2).

3. the Coordinator shall also inform made identification, designation of obligated entity its status as co-ordinator, the competent authorities which have authorised regulated entities in the financial conglomerate, competent authorities of the Member State in which the mixed financial holding, if there was having its registered office and the European Commission.

4. the Minister of economy and finance may establish, by itself or through the competent authorities, a record of financial conglomerates stating the composition and structure of each conglomerate.

Article 16. Cooperation between competent authorities.

The collection and exchange of information between competent authorities will take place on the terms provided for in article 6.3 of the Act and will achieve, as a minimum, the following: a) identification of the structure of the group, all major entities belonging to the financial conglomerate, as well as the competent authorities of the regulated entities in the group.

(b) information on the strategic policies of the financial conglomerate.

(c) the financial situation of the financial conglomerate, in particular on capital adequacy, intra-group transactions, risk concentration and profitability.

(d) major shareholders and the direction of the financial conglomerate.

(e) the organisation, risk management and internal control systems at financial conglomerate level.

(f) procedures for the collection of information from the entities in a financial conglomerate, and the verification of this information.

(g) information on developments adversely regulated entities or in other entities of the financial conglomerate which could seriously affect the regulated entities.

(h) the penalties imposed by the Commission of serious or very serious offences, and the exceptional measures taken by competent authorities.

Chapter IV article 17 implementing measures. Actions in case of non-compliance.

1 if the Coordinator understood that financial conglomerate does not meet any of the requirements which is subject pursuant to provisions in the law and in this Royal Decree and its development provisions, it shall inform the competent authorities concerned, to coordinate their actions pursuant to the powers which, over regulated entities and mixed financial holding companies It gives them the order.


2. If the breach relates to the additional solvency, intra-group transactions requirements or concentration of risks, the Coordinator, in accordance with the other relevant competent authorities, shall require the entity to the elaboration of an appropriate plan of return to compliance. This requirement shall not be required where non-compliance detected in the financial conglomerate is a direct consequence of the deficit of a single entity or consolidatable group integrated in one, unless, in the opinion of the Coordinator, this situation put at serious risk the solvency of other entities or consolidated groups of financial institutions that are integrated in the financial conglomerate.

Chapter V groups of third States article 18. Enabling legislation.

By virtue of the provisions of the second subparagraph of article 8(2) of the law, it enables the Minister of economy and finance, the Bank of Spain and the National Commission of the market of stock, in the field of their respective competencies, to establish other methods for additional supervision of groups whose parent is a regulated entity or a mixed financial holding company which is domiciled outside the European Union. Among these methods, designated authorities shall have the authority to require the establishment of a financial joint holding company which has its registered office in the European Union.

Methods shall comply with the objectives of the supplementary supervision and be communicated to the other competent authorities and the European Commission.

First transitional provision. Transient of non consolidated mixed groups.

While not carried out the identification of the financial conglomerate or group referred to in article 2(2) and, where appropriate, of your institution liable pursuant to the provisions of this Royal Decree, groups that their entry into force had not consolidated mixed groups considering will maintain all obligations of submitting information to which are subject pursuant to title V of the Royal Decree 1343 / 1992 , 6 November.

Second transitional provision. Registration in special registers.

Within the period of six months from the entry into force of this Royal Decree, the members of the Board of Directors, directors or assimilated from the parent of any Spanish regulated entity, which is not a entity's credit, provider of investment or insurance company, reinsurance company, should apply for registration in the corresponding special register of senior , pursuant to the regulations resulting from application.

Third transitional provision. Transitional regime of the application files for the evaluation of properties of insurance companies for the services of the General Directorate of insurance and pension plans.

Applications of valuation of real estate of insurance companies by the technical services of the General Directorate of insurance and pension funds that were submitted prior to the entry into force of this Royal Decree shall be handled and resolved in accordance with the regulations in force at the time of the request.

Sole repeal provision. Regulatory exemptions.

Repealed title IV and title V of the Royal Decree 1343 / 1992, of November 6, development of law 13/1992 of June 1, own resources and supervision on a consolidated basis of the financial institutions.

The provisions relating to the application for the evaluation of properties of insurance companies by the technical services of the General Directorate of insurance and pension funds contained in the order ECO/805/2003, of 27 March, on valuation of real estate and certain rights to certain financial goals are also repealed.

First final provision. Modification of the Royal Decree 1343 / 1992, of November 6, which develops the law 13/1992 of June 1, own resources and supervision on a consolidated basis of the financial institutions.

The Royal Decree 1343 / 1992, dated November 6, which develops law 13/1992 of June 1, own resources and supervision on a consolidated basis of the financial institutions, is modified in the following terms: one. Article 1 is drawn up in the following way: «article 1. Concept.

The groups of financial institutions referred to in chapters I and II of the Act 13/1992 of June 1, own resources and supervision on a consolidated basis of the financial institutions, are those sets of entities of that nature which if any of the following circumstances: to) that a financial institution controls to one or more financial institutions.

(b) that a person, a group of persons acting in concert, or a non-financial entity systematically check to several financial institutions.»

Two. Article 2 is worded as follows: 'article 2. Control of an entity.

1. to determine if there is a relationship of control he will attend to the criteria laid down in article 4 of law 24/1988, of July 28, of securities markets.

2. for the purposes of prudential supervision on a consolidated basis foreseen in this Royal Decree, the financial institutions in which a holding subsists shall be taken into account. Means participation all right about the capital of another company who believes a lasting link with this and is intended to contribute to the activity of the company, as well as, in any case, the holding, directly or indirectly, of at least 20 percent of its capital or voting rights.»

3. The first subparagraph of paragraph 1 of article 3, "Financial institutions", is drawn up in the following way: «(1. A los efectos de este real decreto, tendrán la consideración de entidades financieras las siguientes: a) credit institutions.»

(b) investment services companies.

(c) insurance and reinsurance entities.

(d) investment companies.

(e) the management companies of collective investment institutions, as well as the management companies of pension funds, whose exclusive purpose is the Administration and management of these funds.

(f) venture capital companies and the venture capital fund managers.

(g) entities whose main activity is the holding of shares, unless in the case of mixed financial holding companies subject to supervision at the level of the financial conglomerate.

(h) the entities, what ever your name or status, which, according to the rules applicable, exercise the typical activities of the above.'

Four. Added a paragraph 3 to article 4, 'Entities members of groups of financial institutions by criteria of nationality', with the following wording: «3. in the event that the parent of a credit institution is a financial entity domiciled outside the European Union, shall apply the provisions of article 16.2 bis.»

5. Paragraphs 1 and 3 of article 6, "Consolidation of financial institutions groups", are written in the following way: "1. for the fulfilment of the obligations provided for in this Royal Decree and without prejudice to paragraph 3, financial institutions components of a same group will consolidate each other their financial statements under the terms established in the regulations specific to each type of groups of financial institutions." To the same purpose, financial institutions that do not have subsidiaries must develop some financial statements that apply criteria similar to the consolidation if you have holdings in the direction indicated in paragraph 1 of article 185 of the text revised corporations law, approved by Royal Legislative Decree 1564 / 1989 of 22 December , or, directly or indirectly, at least 20 per cent of the capital or of the voting rights in another financial institution.

Groups of financial institutions will benefit from the processes of risk management and internal control mechanisms appropriate, including administrative procedures and accounting solids, and all entities or companies that integrate them must have appropriate mechanisms to provide the information that is necessary for the required compliance to the group."

«3. by exception, not be consolidated financial statements of insurance entities and groups, on the one hand, with those of credit institutions and the companies of their respective groups, on the other hand, notwithstanding the accounting operations that is mandatory to perform when the cases foreseen by the law 5/2005, of 22 April are and investment services and supervision of financial conglomerates that amending other laws in the financial sector.

(Las sociedades financieras mixtas de cartera mencionadas en el artículo 3.1.g) will be integrated in the corresponding group or subgroup consolidatable of financial institutions when they are controlled by a credit institution, an investment services company or an insurance or reinsurance entity.»

6. Paragraph 1 of article 7, 'Rates of consolidated groups of financial institutions', is drawn up in the following way: «(1. A los efectos de este real decreto, son grupos consolidables de entidades financieras los siguientes: a) the consolidated groups of credit institutions, regulated under Title I.»

«(b) the consolidated groups of investment firms, regulated under Title II.»

7. Paragraph c) of paragraph 1 of article 16, "Definition", is drawn up in the following manner, and added a new paragraph 2 bis, with the following wording:


"(c) that a company whose main activity is to have stakes in financial institutions, an individual, a group of natural persons acting systematically in concert or not consolidatable entity pursuant to the provisions of this Royal Decree control to several financial institutions, at least one of them being a credit institution, and provided that credit institutions are those of greatest relative dimension between financial institutions «, in accordance with the criteria provided by the Minister of economy and finance to the effect.»

«2 bis. When Spanish credit institutions are key to a foreign financial entity domiciled outside the European Union, the Bank of Spain should check that they are subject to supervision on the basis established by a competent authority of a third country which is equivalent to that provided in this Royal Decree.

Where not appreciated the existence of a regime of equivalent supervision, will apply to credit institutions mentioned in the preceding paragraph the regime of supervision on a consolidated basis provided in this Royal Decree.

Notwithstanding the provisions of the preceding paragraph, the Bank of Spain may establish other methods of supervision on a consolidated basis of the groups referred to in this section. Between these methods shall include the power to the Bank of Spain to demand the Constitution of a dominant financial institution which has its head office in the European Union.

Methods must comply with the objectives of the supervision on a consolidated basis in this Royal Decree and be communicated to the other competent authorities involved and the Commission.'

8. Added a paragraph 3 to article 17, 'Prudential Supervision', with the following wording: «3. the Bank of Spain held a general supervision of transactions between credit institutions and other entities included in its consolidatable group, as well as between all those indicated and the dominant non-financial entity and their dependents.» Enabled the Bank of Spain to define the type of operations or categories of operations which will be subject to such supervision, as well as the scope of information, periodic or not, that should be submitted on this matter."

9. Added paragraphs d) bis and f) bis and gives new wording to paragraphs b), c) and f) and the last subparagraph of paragraph 1, the second subparagraph of paragraph 2 of article 20, «Composition of own resources»: «(b) the effective and express, reserves including the participation Fund and the Reserve Fund of cuotaparticipes of savings banks and its Confederation.

(c) reserves of regularization, update or revaluation of assets, as well as capital gains accounted within the shareholders ' equity by application of the criterion of fair value assets, always that they hold to the current accounting standards for credit institutions; the Bank of Spain may agree, according to the volatility of the different types of assets, a reduction of up to two-thirds its gross amount."

«(d) bis the accounting balance of generic coverage corresponds to the risk of insolvency of customers, i.e. linked to inherent losses or not assigned specifically for deterioration of credit risk, provided that they hold accounting standards for credit institutions, and in the part that attended their temporal profile, can remember the Bank of Spain in General.» In any case, this element may not exceed 1.25% of the risks that have served as the basis for the calculation of the coverage, weighted in the manner to be determined in accordance with article 26.»

"(f) the part of the share capital corresponding to the shares of non-voting and the redeemable shares whose duration is not less than that set out in article 22.3 for financing subordinate, regulated in sections 5th and 6th of chapter IV of the text revised corporations law, approved by Royal Legislative Decree 1564 / 1989, of December 22."

«(f) bis preference shares issued in accordance with the provisions of the second additional provision of law 13/1985, of 25 May.»

«(Para su inclusión entre los recursos propios, los elementos recogidos en los párrafos a) (, f, g))(, f) and h) are counted in the part which is effectively paid-up. ' «» Without prejudice to the right of the Bank of Spain referred to in article 22.4, representative of minority interests investments shall be distributed between the paragraphs b), g) and h) of paragraph 1, for the purposes of the limits laid down in article 23, in accordance with the following criteria: to) between the elements referred to in paragraph 1.b) representing ordinary shares shares will be included the materialized in preferred shares issued by foreign affiliates, provided that they are available to cover risk and losses under the same conditions, given its commercial nature, to the ordinary shares, its duration is indeterminate and not granted cumulative rights to the payment of dividends, and the materialized by non-voting shares that do not grant cumulative rights to the payment of dividends.

((b) between the items indicated in paragraph 1.h) will include the representative holdings of non-voting shares issued by Spanish subsidiaries who grant cumulative rights to the payment of dividends, preferred stock issued by foreign subsidiaries that are available to absorb losses of the entity without having to proceed to its dissolution, and that either have indeterminate duration , either, having it determined, is not less than that provided in article 22.3 for the subordinate financing and not grant cumulative rights to the payment of dividends, and the redeemable shares which meet these two last criteria.

((c) between the items indicated in paragraph 1.g) will include the representative holdings of redeemable shares, and preference shares issued with time-bound by foreign affiliates, when making cumulative rights to the payment of dividends. In any case, their duration may not be less than expected in article 22.3 for the subordinate financing.»

10. Paragraph e) of paragraph 1 of article 21, «deductions from own resources', is worded as follows, and add a paragraph e) bis with the following wording: «e) shareholdings in financial institutions that are not integrated into the consolidatable group when, in General, the participation of the entity credit or credit institutions consolidatable group, exceeds 10 per cent of the capital of the investee.

(e) bis with particular character, in the case of shares in insurance companies, reinsurance or entities whose main activity is to have stakes in insurance companies, be deducted shares superior to 20 per cent of the capital of the investee.»

Eleven. The first subparagraph of paragraph 2 and paragraph 4 of article 22, 'Conditions for the computation of own resources', are written in the following way: «(2. Para considerar_se recursos propios, las reservas, fondos y provisiones a que se refieren los párrafos c) (, d)(, d) (bis and e) of paragraph 1 of article 20 shall meet, to the satisfaction of the Bank of Spain» «, the following requirements:» «(4. will correspond to the Bank of Spain rating and inclusion in the equity of an entity of credit or consolidatable group of credit institutions of all kinds of preferred shares or preference shares, issued in accordance with that application, and the elements contained in paragraphs f)(, f) bis» ((,) g and h) of paragraph 1 of article 20, issued by the very institutions or instrumental societies and other subsidiaries. The Bank of Spain will take care especially of the law of the country where the broadcast is made, or own subsidiaries or instrumental societies interposition, not to weaken the effectiveness of the requirements and limitations set out for those instruments, nor its value as own resources of the group.»

12. Paragraphs a) and c) of paragraph 1 and paragraph to) of paragraph 2 of article 23, «Limits in the computation of own resources», are redacted follows: ' a) (basic equity of a credit institution shall be constituted by the sum of the elements set out in paragraphs)(, b) to (, d) and (f) bis of paragraph 1 of article 20» «(((, así como por las acciones sin voto que no otorguen derechos acumulativos ael cobro de dividendos, menos el importe deel concepto previstos en el artículo 21.1.a) and the items included in the concepts referred to in article 21.1. b), c) and d) concerning those elements.»

«(c) (own resources of second category of a credit institution shall be composed of the elements contained in paragraphs c)(, d) (bis, e)(, g) and h) of paragraph 1 of article 20, the non-voting shares which do not meet the conditions to be included among the basic resources and the redeemable shares whose duration is not less than that provided in article 22.3 for the subordinate financing. ' «» «(a) the excess of the elements contained in article 20.1. g) and Computable redeemable shares as second-class resources that grant cumulative rights to the payment of dividends, over 50 per cent of the basic equity of the entity or consolidatable group.»

13. Paragraph c) of paragraph 1 of article 36, 'Definition', is worded in the following way:


"(c) that a company whose main activity is to have stakes in financial institutions, an individual, a group of natural persons acting systematically in concert or not consolidatable entity pursuant to the provisions of this Royal Decree control to several financial institutions, at least one of them being an investment services company, and provided investment services companies are those of greatest relative dimension between financial institutions «, in accordance with the criteria provided by the Minister of economy and finance to the effect.»

Fourteen. The references contained in the Royal Decree 1343 / 1992, November 6, at the consolidated groups of societies and of securities shall be made to the consolidated groups of investment firms.

Second final provision. Modification of the regulation implementing law 13/1989, of May 26, credit unions, approved by Royal Decree 84/1993, January 22nd.

Paragraph 2 of article 2, 'Requirements to obtain and retain the authorization', the regulation of development of law 13/1989, of May 26, credit unions, approved by Royal Decree 84/1993, of 22 January, is drawn up in the following way: «2. go commercial and professional repute who have been observing a personal history of respect for the commercial law or other governing economic activity and the life of the business» , as well as to commercial, financial and banking practices. In any case, means lacking such repute who, in Spain or overseas, have criminal records for intentional crimes, are disabled to exercise public or administrative or financial institutions address charges or are disabled by law 22/2003, of July 9, bankruptcy, while it is not completed the period of disqualification set out in the statement of qualification of the contest the broken and processed not rehabilitated in bankruptcy proceedings prior to the entry into force of the aforementioned law.»

Third final provision. Modification of the Real Decree 1245 / 1995, of July 14, about creation of banks, cross-border activity and other issues relating to the legal regime of credit institutions.

The Royal Decree 1245 / 1995, of July 14, about creation of banks, cross-border activity and other issues relating to the status of credit institutions, is modified in the following terms: one. Paragraph f) of paragraph 1 and paragraph 2 of article 2, 'Requirements to exercise banking activity', are written in the following way, and introduces a new paragraph 6, with the following wording: «f) having a Board of directors consisting of not less than five members. All the members of the Board of Directors of the entity, as well as those of the Board of Directors of its parent company when it exists, shall be persons of recognized commercial and professional repute and must possess, at least the majority in each Council, knowledge and experience appropriate to exercise its functions. These repute and experience should attend also the Directors General or similar entity and its dominant, where it exists, as well as individuals representing legal persons who are directors.»

«2 attend commercial and professional repute who have been observing a personal history of respect for the commercial law or other governing economic activity and the life of the business, as well as commercial, financial and banking practices. In any case, means lacking such repute who, in Spain or overseas, have criminal records for intentional crimes, are disabled to exercise public or administrative or financial institutions address charges or are disabled by law 22/2003, of July 9, bankruptcy, while it is not completed the period of disqualification set out in the statement of qualification of the contest and the broken and processed not rehabilitated in previous bankruptcy procedures to the entry into force of the aforementioned law.»

«6. in addition to the management of the senior members of the banking, will correspond to the Bank of Spain, the creation and management of a register of Directors and Directors General of key entities, that are not credit institutions, companies of investment services or insurance companies and reinsurers of Spanish banks, where counselors, will be registered compulsorily directors and assimilated from those.» For registration in the register such persons shall communicate his appointment within 15 days of taking office, including personal and professional data that establishes, as a general rule, the Bank of Spain and expressly declare in the document confirming his acceptance of the position, that meet the requirements of good repute and, where appropriate, professionalism referred to in this article «, and that are not found in any restrictions or incompatibility established in the rules which were les application.»

Two. Paragraph 2 and the last subparagraph of paragraph 3 of article 7, 'Authorization of banks under the control of foreign nationals', are written in the following way: "2. in the event that Spanish bank control will be exercised by a credit institution, an investment services company or an insurance or reinsurance entity authorised in another Member State of the European Union» the parent of one of those bodies, or by the same natural or legal persons controlling a credit institution, a service company for investment or an insurance or reinsurance entity authorised in another Member State, the Bank of Spain, before issuing the report to that referred to in paragraph 1 of article 1, it shall consult the authorities responsible for the supervision of the credit institution «, provider of investment or foreign insurance or reinsurance entity.» «The authorizations granted to banks set out in this section shall be communicated by the Bank of Spain to the Commission of the European Union, as well as to the competent authorities of the other Member States, specifying the structure of the group to which belongs the controlled entity».

3. Paragraph 2 of article 19, 'Information about the structure of the capital of credit institutions', is worded in the following way: «3. the Bank of Spain, as soon as it becomes aware of it, shall inform the Ministry of economy and Hacienda transmissions of actions or contributions of a credit institution involving a change in control of the entity» , in the sense of article 4 of the law 24/1988, of 28 July. Also, the Bank of Spain shall inform the Commission of the European Union, as well as to the competent authorities of other States members, changes in capital structure established in this section.»

Fourth final provision. Modification of the Royal Decree 692/1996, of April 26, on the legal regime of financial credit establishments.

The Royal Decree 692/1996, of April 26, on the legal regime of financial credit establishments, is modified in the following terms: one. Paragraph 2 of article 4, "authorization and record of financial credit establishments under the control of foreigners, is drawn up in the following way:" 2. in the event that the financial establishment of Spanish credit control will be exercised by a credit institution, an investment services company or an insurance or reinsurance entity authorised in another Member State of the European Union» the parent of one of these entities or by the same natural or legal persons controlling a credit institution, a service company for investment or an insurance or reinsurance entity authorised in another Member State, the Bank of Spain, before issuing the report to that referred to in article 3.1, it shall consult the authorities responsible for the supervision of the credit institution , provider of investment or foreign insurance or reinsurance entity.

Authorisations granted to financial credit establishments referred to in this paragraph shall be communicated by the Bank of Spain to the Commission of the European Union, as well as to the competent authorities of the other Member States, specifying the structure of the group to which belongs the controlled entity.»

Two. Paragraph e) of paragraph 1 of article 5, 'Requirements for exercising the activity', is drawn up in the following manner, and added a second paragraph in its paragraph 3, with the following wording: «e) having a Board of directors consisting of not less than three members. All the members of the Board of Directors of the entity, as well as those of the Board of Directors of its parent company when it exists, shall be persons of recognized commercial and professional repute and must have at least three members of each of the advice, expertise and experience appropriate to exercise its functions. These repute and experience must also attend the Directors General or similar entity and its dominant, where it exists, as well as individuals representing legal persons who are directors.


There is commercial and professional repute who have been observing a personal history of respect for the commercial law or other governing economic activity and the life of the business, as well as commercial, financial and banking practices. In any case, means lacking such repute who, in Spain or abroad, have a history criminal for fraudulent crimes are disabled to exercise public or administrative or financial institutions address charges or disabled by law 22/2003, of July 9, bankruptcy, while it is not completed the period of disqualification set out in the statement of qualification of the contest and the broken and processed not rehabilitated in previous bankruptcy procedures to the entry into force of the aforementioned law.

They possess appropriate knowledge and experience to carry out their functions in financial establishments of credit who have played, for a period not less than two years, senior management, direction, control or financial institutions advisory functions or functions of similar responsibility in other entities, public or private, in dimension at least analogous to the entity that intends to create.»

«Also corresponds to the Bank of Spain, the creation and management of a register of Directors and Directors General of key entities, that are not credit institutions, companies of investment services or insurance companies and reinsurers of Spanish financial credit establishments, where counselors, will be registered compulsorily directors and assimilated from those.» For enrollment in the registry follow the same procedure laid down in the preceding paragraph.'

Fifth final provision. Modification of Royal Decree 775/1997, of 30 may on the legal regime for the approval of services and appraisal companies.

Paragraph 2 of article 3, 'Requirements for type-approval', of the Royal Decree 775/1997, of 30 may, on the legal regime for the approval of services and appraisal companies, is drawn up in the following way: «2. for the purposes of approval, there is commercial and professional repute who have been observing a personal history of respect for the commercial law or other governing economic activity and the life of the business» , as well as to commercial, financial and banking practices.

In any case, means lacking such repute who, in Spain or overseas, have criminal records for intentional crimes, are disabled to exercise public or administrative or financial institutions address charges or are disabled by law 22/2003, of July 9, bankruptcy, while it is not completed the period of disqualification set out in the statement of qualification of the contest and the broken and processed not rehabilitated in previous bankruptcy procedures to the entry into force of the aforementioned law.»

Sixth final provision. Modification of the rules of ordination and supervision of private insurance, approved by Royal Decree 2486 / 1998, dated 20 November.

The management and supervision of private insurance, regulation approved by Royal Decree 2486 / 1998, 20 November, is modified in the following terms: one. (Added a paragraph b) bis and amending paragraph e), both in paragraph 1 of article 4, "application and administrative authorization, with the following wording: «b) bis relationship of the partners who have the status of insurance company, credit institution or investment services company, as well as, where applicable, contributions, regardless of the amount» which holder any partner in an insurance company, a credit institution or an investment services company.»

«(e) relationship of who, under any title, lead the effective address of the entity, or parent, which will accompany completed the questionnaire which established the Ministry of economy and finance referred to the conditions of professional qualification or experience referred to in article 15 of the law.»

Two. Paragraph d) of paragraph 10 of article 50, 'Goods and rights suitable for the investment of technical provisions', is drawn up in the following way: «d) have been appraised by an tasadora entity authorized for the valuation of assets in the mortgage market, according to specific rules for the valuation of real estate suitable for covering technical provisions of the insurance companies approved by the Ministry of economy and finance. "

3. Added a final paragraph to paragraph 1.d) article 52, «Valuation of technical provisions investments», with the following wording: «The direction General de Seguros y Fondos de Pensiones may check and review ex officio, through its technical services, values attributed to real estate and real estate property rights.»

Four. Added paragraphs e)) and (f) in paragraph 2, as well as a new paragraph 2 bis, article 59, «Unencumbered own heritage», with the following wording: «e) contributions equal or exceed the 20 per cent of the capital or voting rights of the company which the insurance institution in other insurance companies or reinsurance, in credit institutions investment service companies or entities whose main activity consist in having stakes in insurance companies.

(f) the subordinate financing or other Computable values in the own unencumbered assets issued by entities referred to in the preceding paragraph and acquired by the insurance company."

«2 bis. The deductions referred to in paragraph 2 above shall be carried out by its value in the books of the entity holding.

As an alternative to the deduction of the items referred to in paragraphs e) and f) of paragraph 2, that the insurance company holds in credit institutions, any entity in the financial sector, insurance companies and investment services firms may apply the methods of the annex to Royal Decree 1332 / 2005 of 11 November, development of law 5/2005 22 April, supervision of financial conglomerates and by which other financial sector laws are modified. Method 1 (accounting consolidation) shall only apply where the entities included in the scope of consolidation will have a level of integrated management and internal control in accordance with article 110 of this regulation. The method that you choose should subsequently be applied consistently.

«(En todo caso, las entidades integrantes de grupos aseguradores y de conglomerados financieros sujetos a supervisión adicional, podrán no deducir los elementos previstos en los párrafos e) and f) of paragraph 2 in credit institutions, investment firms, holding companies of insurance or reinsurance or holdings of insurance entities included in the scope of supplementary supervision.»

5. Paragraph e) of paragraph 1 of article 67, 'Consolidatable group of insurance companies', is worded in the following way: 'e) entities whose main activity is the holding of shares, unless in the case of financial mixed holding companies subject to supervision at the level of the financial conglomerate which are not controlled by an insurance or reinsurance entity.'

6. Article 110 title and paragraph 1 are written in the following way: «article 110. Internal control and management of risks of the insurance entities.

1. the insurance entities must establish processes for risk management and internal control mechanisms appropriate, including administrative procedures and accounting solids, as well as have enough information, so that the address of the entity may have an updated knowledge about the evolution of their activity, the functioning of their departments and distribution networks, and the behavior of basic economico-actuariales quantities of your business.

Consolidatable group of insurance companies, through the entities that compose it, establish risk management processes and internal control mechanisms appropriate, including administrative procedures and accounting solids, to ensure the full availability and adequate presentation of all data and information in general are necessary for the preparation and completion of the consolidated accounts, including the consolidated technical reserves and solvency margin coverage."

7. Article 121 is drawn up in the following way: «article 121. Administrative records.

Open books for each of the types of insurance companies and reinsurance companies act and for the distribution of the coverage of risks between entities or organizations for the delivery of common services with his activity, as well as for its senior officials and those of its parent, and brokers of insurance and insurance brokerage companies and their officials «, all this with the breakdown that is necessary.»

8. The first subparagraph of paragraph 1 of article 123, 'Administrative register of senior positions in insurance and reinsurance companies', is drawn up in the following way: «1. the insurance entities and those whose main activity consist in having holdings in insurance companies must apply for the registration of administrators or directors, Directors General or assimilated, parents and that under any title carrying the effective direction of the entities. "


9. Gets a ninth additional provision, with the following wording: «ninth additional provision. Information to be supplied by the General Directorate of insurance and pension funds to the supervisory authorities of the European Union.

«(En los supuestos a los que se refieren los párrafos a) and b) of the article 77.2 of the law, the General Directorate of insurance and pension funds shall, in addition to the Commission of the European communities, to the competent authorities of the other Member States.»

Seventh final disposition. Modification of the Royal Decree 2660 / 1998, of 14 December, on the foreign currency exchange in establishments open to the public other than credit institutions.

Paragraph 3 of article 4, 'Requirements to obtain and retain the authorization to pursue the activity of foreign currency exchange', of Royal Decree 2660 / 1998, of 14 December, on the foreign currency exchange in establishments open to the public other than credit institutions, is drawn up in the following way: «3. attends trade and professional repute who have been observing a personal history of respect for the commercial law or other governing economic activity» and the life of businesses, as well as commercial, financial and banking practices.

In the case referred to in article 2(1), shall be deemed to meet the requirements of commercial and professional repute by the existence of an establishment open to the public in which the main activity of the applicant is developing.

In any case, means lacking such repute who, in Spain or overseas, have criminal records for intentional crimes, are disabled to exercise public or administrative or financial institutions address charges or are disabled by law 22/2003, of July 9, bankruptcy, while it is not completed the period of disqualification set out in the statement of qualification of the contest and the broken and processed not rehabilitated in previous bankruptcy procedures to the entry into force of the aforementioned law.»

Disposal the eighth. Modification of the Royal Decree 867/2001 of 20 July, on the legal regime of investment services companies.

The Royal Decree 867/2001 of 20 July, on the legal regime of investment services companies, is modified in the following terms: one. Paragraph e) of paragraph 1 and paragraph 2 of article 14, «Requirements to practise», are redacted follows: «e) having a Board of Directors formed by not less than five members on securities firms, and by no less than three in values and management companies agencies portfolio. All of them, as well as the of its parent company, when it exists, shall be persons of recognized honorability business or professional and must possess, at least the majority in each Council, knowledge and experience appropriate on matters related to the stock market to perform its functions. Such honesty, knowledge and experience will be required also directors general or similar entity and its dominant, where it exists, as well as individuals representing legal persons in the Board of Directors.»

«2 attend commercial and professional repute who have been observing a personal history of respect for the commercial law or other governing economic activity and the life of the business, as well as commercial and financial practices. In any case, means lacking such repute who, in Spain or overseas, have criminal records for intentional crimes, are disabled to exercise public or administrative or financial institutions address charges or are disabled by law 22/2003, of July 9, bankruptcy, while it is not completed the period of disqualification set out in the statement of qualification of the contest and the broken and processed not rehabilitated in previous bankruptcy procedures to the entry into force of the aforementioned law.»

Two. A new paragraph 3 is inserted into the Choc - the 16, 'The application requirements', with the following wording: «3. will correspond to the National Commission of the stock market, the creation and management of a register of Directors and CEOs of the dominant entities, that are not credit institutions, companies of investment services or insurance companies and reinsurers of Spanish investment services companies» , where counselors, will be registered compulsorily directors and similar ones. For registration in the register, such persons shall communicate his appointment within 15 days of taking office, including personal and professional data that establishes the National Commission of the stock market in General, and expressly declare in the document confirming his acceptance of the position, that meet the requirements of good repute and, in your case «, professionalism that are enforceable, and not found in any restrictions or incompatibility established in the rules which were les application.»

3. Paragraphs 1 and 2 of article 19, 'Authorization of investment services companies subject to the control of foreign nationals', are written in the following way: «1. authorisation for the creation of a company of Spanish investment services shall be subject to prior consultation with the competent supervisor of the Member State of the European Union authority where any of the following circumstances» (: to) that the new company will be controlled by a service company for investment, or a credit institution or an insurance company, reinsurance company, licensed in that State.

(b) that your control will be exercised by the dominant company of a utility of investment, or of an entity of credit or insurance or reinsurance entity authorised in that State.

(c) that your control will be exercised by the same natural or legal persons that control a company of services of investment, or a credit institution or an insurance company or reinsurer, authorised in that Member State.

Means that a company is controlled by another when some of the assumptions referred to in article 4 of law 24/1988, of July 28, of securities markets.

2. the consultation shall by the National Commission of the stock market from the equivalent competent supervisory agency of the country of origin of the entity that exercises control. It will reach, in particular, to the evaluation of the suitability of the shareholders and the reputation and experience of the directors and management of the new entity or of the parent, and you can repeat for continuous assessment of compliance by the investment services companies Spanish, these requirements."

Ninth final disposition. Modification of the regulation of plans and pension funds, approved by Royal Decree 304/2004 of 20 February.

The second subparagraph of paragraph 2 of article 75 of the regulation of plans and pension funds, approved by Royal Decree 304/2004, is drawn up in the following way: «with at least annually, the properties of the Fund must be appraised. The appraisals must be done by a tasadora entity authorized for the valuation of assets in the mortgage market, according to specific rules for the valuation of real estate approved by the Ministry of economy and finance. The General Directorate of insurance and pension funds can check and reviewing trade, through its technical services, attributed to real estate values.»

Tenth final disposition. Basic character.

This Royal Decree, which will have basic character, is run under the auspices of competence certificates referred to in article 149.1.11. 2nd and 13th of the Constitution.

Eleventh final disposition. Incorporation of European Union law.

By this Royal Decree is completed the transposition to the right to Spanish of Directive 2002/87/EC of the European Parliament and of the Council of 16 December 2002, concerning the supervision of credit institutions, insurance companies and entities from investment belonging to a financial conglomerate, which directives amending 73/239/EEC 79/267/EEC, 92/49/EEC, 92/96/EEC, 93/6/EEC and 93/22/EEC of the Council and directives 98/78/EC and 2000/12/EC of the European Parliament and of the Council. In addition, by this Royal Decree joins Spanish law Directive 2005/1/EC of the European Parliament and of the Council of 9 March 2005, by which modify the Directives 73/239/EEC, 85/611/EEC, 91/675/EEC, 92/49/EEC and 93/6/EEC of the Council, and directives 94/19/EC, 98/78/EC 2000/12/EC, 2001/34/EC, 2002/83/EC and 2002/87/EC, in order to establish a new organisational structure for financial services committees.

Twelfth final provision. Enabling the regulatory development.

It empowers the Minister of economy and finance and, with its express empowerment, the Bank of Spain and the National Commission of the stock market to dictate how many provisions are necessary for the development and execution of this Royal Decree.

Thirteenth final disposition. Entry into force.

This Royal Decree shall enter into force the day following its publication in the «Official Gazette» and will be applied first to the supervision of accounts for the year 2005.

Given in Madrid on November 11, 2005.

JUAN CARLOS R.

The second Vice President of the Government and Minister of economy and finance, PEDRO SOLBES MIRA annex methods of calculation


The methods referred to in article 6.1 are as follows: method 1: 1 accounting consolidation method. The calculation of the requirements of the adequacy of the additional capital of the regulated entities in a financial conglomerate shall be carried out on the basis of the consolidated accounts.

2 the additional capital adequacy requirements shall be calculated as the difference between: a) the funds of the financial conglomerate calculated on the basis of the consolidated position of the Group; eligible items will be that are considered eligible in accordance with the relevant sectoral rules, and (b)) the sum of the solvency requirements of the financial sectors represented in the Group; the solvency of the financial sectors requirements shall be calculated in accordance with the corresponding sectoral rules.

3. in the case of non-regulated entities in the financial sector which are not included in the calculations of the aforementioned sectoral solvency requirements, a notional solvency requirement shall be calculated.

4. the difference shall not give a negative result.

Method 2: method of deduction and aggregation 1. The calculation of the requirements of the adequacy of the additional capital of the regulated entities in a financial conglomerate shall be carried out on the basis of the accounts of each of the companies of the group.

2 the additional capital adequacy requirements shall be calculated as the difference between: a) the sum of funds of each regulated and non-regulated financial sector in the financial conglomerate; eligible items will be that are considered eligible in accordance with the relevant sectoral rules, and (b)) the sum of: 1 the solvency requirements for each regulated and non-regulated financial sector of the Group; the solvency requirements shall be calculated in accordance with the relevant sectoral rules, and 2 the book value of the participations in other entities of the group.

3. in the case of non-regulated financial sector entities, a notional solvency requirement shall be calculated. Own resources and solvency requirements shall be taken into account in relation to its share, in accordance with the provisions in article 6.3 and in article 7.

4. the difference shall not give a negative result.

Method 3: accounting/1 requirement deduction value method. The calculation of the requirements of the adequacy of the additional capital of the regulated entities in a financial conglomerate shall be carried out on the basis of the accounts of each of the companies of the group.

2 the additional capital adequacy requirements shall be calculated as the difference between: a) the equity of the dominant company or the entity that head of the financial conglomerate; (eligible items will be that are considered eligible in accordance with the relevant sectoral rules, and (b)) the sum of: 1 the solvency requirement of the dominant company or the entity that head the conglomerate referred to in paragraph to), and 2nd the largest between the accounting value of the participation of other entities in the Group and these entities ' solvency requirements; the solvency of these requirements shall be taken into account in relation to its share, in accordance with the provisions in article 6.3 and in article 7.

3. in the case of non-regulated financial sector entities, a notional solvency requirement shall be calculated. Valuing the elements eligible for the calculation of the additional capital adequacy requirements, participations may be valued by the equity method.

4. the difference shall not give a negative result.

Method 4: combination of methods may be the calculation of the requirements of the adequacy of the additional capital of the regulated entities in a financial conglomerate through the combination of two or three previous methods.