Instruction No. 2021-I-16 of December 6, 2021, on Monitoring the Threshold for Establishing an Intermediate Parent Company for Third-Country Groups in the Union (Consolidated Version)

PRUDENTIAL SUPERVISION AND RESOLUTION AUTHORITY - ---- Instruction No. 2021-I-16 On Monitoring the Threshold Constituting an Intermediate Parent Company For Third-Country Groups in the Union Modified by Instruction No. 2025-I-05 of May 22, 2025

The Prudential Supervision and Resolution Authority (ACPR), Having regard to the Monetary and Financial Code, particularly Articles L.517-4-2, L. 517-11 and R. 517-9 as well as L. 511-34, L. 561-33, L. 612-24 and R. 612-21; Having regard to the opinion of the Prudential Affairs Consultative Committee of November 16 2021, DECIDES

Article 1:
This instruction applies to establishments and companies established in France that are part of a group whose parent company is established in a tertiary country that has not put in place an intermediate parent company mentioned in Article
L. 517-4-2 of the Monetary and Financial Code, hereinafter referred to as "subjected
establishments", as follows:

• credit institutions mentioned in I of Article L. 511-1 of the Monetary
  and Financial Code;
• branches of credit institutions from third countries;
• investment firms mentioned in Article L. 531-4 of the Monetary
  and Financial Code;
• branches of investment firms from third countries;
• financial holding companies mentioned in Article L. 517-1 of the Monetary
  and Financial Code;
• mixed financial holding companies mentioned in Article L. 517-4 of the
  Monetary and Financial Code;
• investment holding companies mentioned in Article L. 517-4-3 of the
  Monetary and Financial Code.

CONSOLIDATED INSTRUCTION

Article 2:
The establishments listed in Article 1, which are parents in the Union of a group of third countries at the highest level of consolidation in the Union ("parent establishments"), or the subjected establishments that do not form part of a group subject to consolidated supervision in the Union ("autonomous establishments"), must evaluate, prospectively and at least once a year, whether the total value of the assets of the third-country group in the Union to which they belong would be called upon to cross during four consecutive quarters the threshold mentioned in Article
L. 517-11 of the Monetary and Financial Code imposing the establishment of an
intermediate parent company ("prospective monitoring").
Establishments of the third-country group no longer have to carry out prospective monitoring after the establishment of an intermediate parent company in the Union. Prospective monitoring is based on strategic planning and asset forecasts prepared for a period of at least three years for the entire group. The total value of assets in the Union of a third-country group is calculated in accordance with Article R. 517-9 of the Monetary and Financial Code. The establishments referred to in Article 1 exchange with each other, and, if necessary, with establishments located in other countries of the European Union making up the same third-country group in due time, all information required to conduct prospective monitoring.

Article 3:
When prospective monitoring shows that the total value of assets in the Union of a group should cross the threshold under the conditions described in
Article 2 of this instruction, and it appears that the ACPR should be
designated as the consolidated supervision authority for the future intermediate parent company in the Union in accordance with Article 6 of the Order of November 3, 2014, relating to prudential supervision on a consolidated basis and to
Article L. 613-20-1 of the Monetary and Financial Code, the establishments referred to in
Article 1 coordinate to alert the ACPR of the crossing of the threshold
mentioned in Article 2, providing it with all relevant information and without unjustified delay ("the notification"). When prospective monitoring shows that a third-country group will reach the threshold, parent establishments and autonomous establishments should apply all monitoring procedures sufficiently in advance and take all necessary measures to satisfy all legal requirements necessary for the intermediate parent company to be immediately operational once the threshold is reached.

Article 4:
All information necessary to understand the evolution of the total value of assets of the third-country group is attached to the notification. They include at least:

• a projection, at quarterly intervals, of the total value of assets over a horizon of at
  least three years, according to a distribution distinguishing the subjected establishments of the local group located in the Union and;
• the strategic plan of the group.
  The notification is sent to the ACPR by electronic transmission in office format. The data are reported in euros, under French accounting standards or under IFRS. The notification must be communicated under the conditions set by the instruction of the Prudential Supervision and Resolution Authority No. 2025-I-05.

Article 5:
This instruction enters into application on December 31, 2021. in force on July 1, 2025. Paris, December 6, 2021 The Designated President, Denis BEAU