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Verband der Auslandsbanken in Deutschland e.V. / Association of Foreign Banks in Germany

VAB

Der Verband der Auslandsbanken in Deutschland e.V.

Lobbying Activity

Response to Payment services – revision of EU rules (new Regulation)

1 Nov 2023

Please find attached the Position Paper of the Association of Foreign Banks in Germany (VAB) of 1 November 2023 on the Proposal for a REGULATION OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL on payment services in the internal market and amending Regulation (EU) No 1093/2010 [COM (2023) 367 / Procedure 2023/0210/COD].
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Response to Open finance framework

1 Nov 2023

Please find attached the Position Paper of the Association of Foreign Banks in Germany (VAB) of 1 November 2023 on the Proposal for a REGULATION OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL on a framework for Financial Data Access and amending Regulations (EU) No 1093/2010, (EU) No 1094/2010, (EU) No 1095/2010 and (EU) 2022/2554 [COM (2023) 360 / Procedure 2023/0205/COD].
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Response to Establishing the digital euro

8 Sept 2023

With the attached Position Paper of 8 September 2023, the Association of Foreign Banks in Germany comments on the Proposal for a REGULATION OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL on the establishment of the digital euro [COM (2023) 369; procedure 2023/0212/COD], especially regarding the intended obligation to contract for all credit institutions offering payment accounts. We would be pleased if our evaluations provide you with useful information. Please do not hesitate to contact us if you have any questions.
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Response to Banking Union: Review of the bank crisis management and deposit insurance framework (DGSD review)

9 Aug 2023

From our Associations point of view, we would like to comment on two critical points in the CMDI package as follows: 1. It is planned to amend Art. 31(2)(d) BRRD in a way that the protection of all depositors is made a resolution goal in the future (full protection of all depositors) and not only the protection of depositors covered by the deposit protection schemes. 2. Draft Art. 32(5) BRRD sets out additional preconditions for insolvency proceedings for the resolution of institutions. This is intended to ensure that normal insolvency proceedings may only replace a resolution according to BRRD if the insolvency proceedings would attain the resolution goals more effectively. The following wording is proposed: a resolution action shall be treated as in the public interest where that resolution action is necessary for the achievement of, and is proportionate to, one or more of the resolution objectives referred to in Article 31 and where winding up of the institution under normal insolvency proceedings would not meet those resolution objectives more effectively. On the basis of the following thoughts we would like to give the following recommendations for further work on the Commission proposal:: 1. As today, full resolution planning, including resolution measures under the BRRD, should only be required for institutions that are at least potentially systemically relevant. 2. The resolution authorities should continue to be able to provide for resolution in insolvency proceedings as a rule for small and medium-sized institutions, without being subject to a special obligation to justify this in the specific case. Reasons: The new provision proposed in Art. 31(2)(d) BRRD establishing the protection of all deposits as a resolution goal gives rise to the worry that each institution having depositors as clients will have to prepare a resolution plan on the basis of the resolution measures according to BRRD in the future. This applies irrespective of the size of the institution and the sum of deposits held with the institution. Even very small, small and medium-sized institutions could be in scope, which would lead in turn to disproportionate burden. The proposed new Art. 32(5) BRRD results in resolution authorities being obligated to justify themselves if they deem insolvency proceedings as a suitable means to address a case of crisis and prefer such insolvency proceedings over the resolution process according to BRRD. As a consequence, the pressure is created to discontinue the use of insolvency proceedings for resolution purposes. This goes against todays nearly unanimous expert opinion that insolvence proceedings are the most suitable solution for less significant institutions. In addition, such a justification why insolvency proceedings are more effective to reach the resolution goals in the individual case can only be given provided that a resolution plan on the basis of BRRD measures is already at hand for comparative purposes. Such BRRD resolution plan cannot be prepared after a crisis situation becomes visible, because at that stage, all decisions are time-critical. Therefore, the BRRD resolution plan would have to be prepared well in advance before an eventual case of crisis. So, as the proposed Art. 32(5) BRRD does not contain any excemptions, o A factual obligation is created to comprehensively plan resolution pursuant to BRRD, and o This obligation applies for all institutions in the same way, irrespective of their size. Our experience with the implementation of BRRD and SRMR is that the preparation of resolution plans on the basis of BRRD resolution measures triggers a considerable administrative burden for institutions and also for resolution authorities. Such burden has to date only be inflicted on systemically relevant institutions for good reason, because it is disproportionate for less significant institutions.
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Response to Instant Payments

5 Jan 2023

Please find attached the Position Paper of the Association of Foreign Banks in Germany of 5 January 2023 on the Proposal for a REGULATION OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL amending Regulations (EU) No 260/2012 and (EU) 2021/1230 as regards instant credit transfers in Euro.
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Response to Alignment EU rules on capital requirements to international standards (prudential requirements and market discipline)

16 Feb 2022

Art. 4 (1) point (145) CRR should be amended as to include a de minimis threshold. Institutions with a balance sheet total of under € 750 million should be able to obtain the status as small and non-complex regardless of whether the criterion (f) is met, according to which more than 75 % of both the institution's consolidated total assets and liabilities, excluding in both cases the intragroup exposures, must relate to activities with counterparties located in the European Economic Area.
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Response to Alignment of EU rules on capital requirements to international standards (review processes)

16 Feb 2022

Cross-border services by third country undertaking into the EU (Art. 21c of the draft CRD): - We propose and encourage the introduction of a grandfathering provision which protects contractual agreements existing at the time of the entry into force of the national law transposing Art. 21c and which allows for ongoing servicing of contracts until the end of the contractual term. - Draft Art. 21c should be clarified by stating that contractual agreements between financial counterparties as defined in Art. 2 no. 8 of Regulation (EU) No. 648/2012 (EMIR) are deemed to be entered into by way of reverse solicitation. Regulation of non-EU banks’ third country branches in the EU (TCBs) - TCBs should not be regarded as class 1 if they fulfill either of the following criteria: • They take deposits and other repayable funds exclusively from their own employees, or • The total number of client accounts with deposits and other repayable funds taken from retail customers does not exceed 500. - Draft Art. 48c (3)(d) should either be deleted or at least amended in a way that enables TCBs to provide cross-border services within the EU where such services are provided on the basis of reverse solicitation, i.e. on the client’s request. - We advise to include a grandfathering provision allowing for the retention of existing authorisations of TCBs if these would not be renewed solely on the basis of the lack of a relevant MoU, provided that the TCB’s already existing authorisation is subject to full application of CRD and CRR as well as AMLD under national law. Treatment of international investment firm groups ("Group Test", Art. 8a CRD) - We strongly suggest to modify Art. 8a(1)(b) CRD by clarifying that only an aggregate balance sheet total of the group within the EU can trigger the conversion of an investment firm into a credit institution.
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Response to Revision of EU rules on Anti-Money Laundering (recast)

18 Nov 2021

The Association of Foreign Banks in Germany (VAB) represents the interests of currently more than 200 foreign banks and other financial services institutions which operate in Germany via subsidiary or branch. Almost all member institutions are therefore part of a cross-border banking of financial group. Those groups can highly benefit from the envisaged uniform rules regarding anti-money laundering and countering terrorist financing on EU level. We therefore appreciate the chosen path to introduce a regulation on AML/CFT rules that will become directly-applicable for obliged entities in all Member States. Please find attached the Position paper of the Association of Foreign Banks in Germany of 18 November 2021 on (a) the Proposal for a Regulation of the European Parliament and of the Council on the prevention of the use of the financial system for the purposes of money laundering or terrorist financing (COM (2021) 420, procedure 2021/0239/COD), hereafter: “AMLR”; and on (b) the Proposal for a Directive of the European Parliament and of the Council on the mechanisms to be put in place by the Member States for the prevention of the use of the financial system for the purposes of money laundering or terrorist financing and repealing Directive (EU) 2015/849 (COM (2021) 423, procedure 2021/0250/COD), hereafter: “AMLD6”. With regards to the presented draft AMLR, the VAB addresses the following topics in its position paper: - Introduction of proliferation financing-related targeted financial sanctions into the AML/CFT framework; - Introduction of an (AML/CFT) Compliance Officer; - Involvement in the processing of an occasional transaction; - Identification of the person acting on behalf of the contractual partner (“customer”); - Involvement of a high risk third country; - Performance by third parties: reliance and outsourcing regarding monitoring of business relationship and transactions; - Performance by third parties: outsourcing within a group of obliged entities; - Beneficial ownership and the exemptions for companies listed on a regulated market and for bodies governed by public law; - Introduction of a transparency register obligation for third country clients. And with regards to the presented draft AMLD6, the VAB addresses the following topics in its position paper: - Exemption for bodies governed by public law from beneficial ownership registers; - Clarification on proxy holders.
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Response to Revision of EU rules on Anti-Money Laundering (new instrument)

18 Nov 2021

The Association of Foreign Banks in Germany (VAB) represents the interests of currently more than 200 foreign banks and other financial services institutions which operate in Germany via subsidiary or branch. Almost all member institutions are therefore part of a cross-border banking of financial group. Those groups can highly benefit from the envisaged uniform rules regarding anti-money laundering and countering terrorist financing on EU level. We therefore appreciate the chosen path to introduce a regulation on AML/CFT rules that will become directly-applicable for obliged entities in all Member States. Please find attached the Position paper of the Association of Foreign Banks in Germany of 18 November 2021 on (a) the Proposal for a Regulation of the European Parliament and of the Council on the prevention of the use of the financial system for the purposes of money laundering or terrorist financing (COM (2021) 420, procedure 2021/0239/COD), hereafter: “AMLR”; and on (b) the Proposal for a Directive of the European Parliament and of the Council on the mechanisms to be put in place by the Member States for the prevention of the use of the financial system for the purposes of money laundering or terrorist financing and repealing Directive (EU) 2015/849 (COM (2021) 423, procedure 2021/0250/COD), hereafter: “AMLD6”. With regards to the presented draft AMLR, the VAB addresses the following topics in its position paper: - Introduction of proliferation financing-related targeted financial sanctions into the AML/CFT framework; - Introduction of an (AML/CFT) Compliance Officer; - Involvement in the processing of an occasional transaction; - Identification of the person acting on behalf of the contractual partner (“customer”); - Involvement of a high risk third country; - Performance by third parties: reliance and outsourcing regarding monitoring of business relationship and transactions; - Performance by third parties: outsourcing within a group of obliged entities; - Beneficial ownership and the exemptions for companies listed on a regulated market and for bodies governed by public law; - Introduction of a transparency register obligation for third country clients. And with regards to the presented draft AMLD6, the VAB addresses the following topics in its position paper: - Exemption for bodies governed by public law from beneficial ownership registers; - Clarification on proxy holders.
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Response to Digital Operational Resilience of Financial Services (DORFS) Act

18 May 2021

Dear Sir or Madam, Please find attached the Position Paper of the Association of Foreign Banks in Germany dated 18 May 2021 with respect to the proposal for a Regulation on digital operational resilience for the financial sector (DORA). In addition to our first submission dated 15 February 2021 (feedback reference F1838380), we would like to address the following points: - Distinction between financial entities and ICT third-party service providers - Distinction between financial entities and ICT third-party service providers in third countries - Critical ICT third-party service providers in third countries Kind regards.
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Response to Instant Payments

7 Apr 2021

Dear Sir or Madam, We appreciate the opportunity to provide input to the inception impact assessment document Ares(2021)1648321 on Instant Payments. Please find enclosed our position paper of 7 April 2021 concerning the following topics: (i) Directive or Regulation (ii) Implications of mandatory adherence to SEPA Instant Credit Transfers (iii) Compliance risks for PSPs (iv) Voluntary adherence as an alternative Kind regards.
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Response to Revision of the NIS Directive

18 Mar 2021

Dear Sir or Madam, We highly appreciate the opportunity to provide input to the review of the EU rules on the security of network and information systems. Please find enclosed our position paper on the following topics: (A) Classification of small and non-complex credit institutions as important entities according to Annex 2 (B) Reference to DORA in order to increase legal certainty (C) Clarification on the treatment of branches of essential and important entities established in other Member States (D) Maximum amount of penalties Kind regards.
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