CP13/6 - CRD IV for Investment Firms - Financial Conduct Authority

CP13/6
CRD IV for Investment Firms
1.13 The CRD has been amended on a number of occasions since it was originally adopted, most
significantly by CRD II (Directives 2009/111/EC, 2009/27/EC and 2009/83/EC) and CRD III
(Directive 2010/76/EU). References in this CP to current CRD include the amendments introduced
by the CRD II and CRD III legislative packages.
1.14 CRD IV was presented by the Commission in July 2011. Negotiations on a final text between
the Commission, the Council and the European Parliament concluded in March 2013. The final
rules have been published in the Official Journal of the European Union on 27 June 2013.
1.15 CRD IV transposes into EU law the Basel III agreement concluded by the Basel Committee in
November 2010. Basel III – among other items:
• strengthens bank capital requirements;
• introduces a capital conservation buffer and a macro-prudential countercyclical buffer; and
• foresees a framework for new regulatory regimes on liquidity and leverage, as well as
additional capital surcharges for systemically important institutions.
1.16 The FCA is now required to consult in transposing into the FCA Handbook those aspects of
CRD IV for which it is responsible in time for the CRD IV implementation date of 1 January
2014.
CRD IV – Structure
1.17 CRD IV is divided into two legislative instruments:
• Regulation (EU) 575/2013 (the Capital Requirements Regulation, CRR or the Regulation) –
most of which will be directly applicable and take effect in all Member States without any
further action; and
• Directive 2013/36/EU (the Directive) – which Member States must transpose into national law.
• CRD IV also represents the Commission’s intention to create a single rulebook for banking.
This choice of policy instruments (Regulation) is intended to prevent the transposition from
producing diverging national requirements, while providing a degree of flexibility via limited
areas of national discretions. CRD IV also replaces the current CRD by unifying the prudential
requirements from both BCD and CAD and integrating them into the main bodies of the
Regulation and the Directive.
8 July 2013
Financial Conduct Authority