Royal Decree of 27 November 2014 amending the Royal Decrees on the annual and consolidated accounts of credit institutions, investment firms, and management companies of collective investment undertakings

FEDERAL PUBLIC SERVICE FINANCES
[C − 2014/04024]
27 NOVEMBER 2014. — Royal Decree amending the Royal Decrees on the annual and consolidated accounts of credit institutions, investment firms, and management companies of collective investment undertakings

REPORT TO THE KING

Sire,

The Royal Decree that I have the honour to submit to Your signature aims to transpose Article 89 of Directive 2013/36/EU of the European Parliament and of the Council of 26 June 2013 on the access to the activity of credit institutions and the prudential supervision of credit institutions and investment firms, amending Directive 2002/87/EC and repealing Directives 2006/48/EC and 2006/49/EC, into Belgian national law.

This European provision aims to strengthen the transparency of the activities of institutions in the various countries in which they are established by requiring them to communicate various information on a country-by-country basis.

The Directive provides (Article 89, paragraph 4) that this information must be audited in accordance with Directive 2006/43/EC (on the statutory audit of annual accounts and consolidated accounts). The Directive also stipulates that the information must be published, where possible, as an annex to the annual accounts or, where applicable, to the consolidated accounts of the institution.

To comply with this provision, it is proposed to amend the accounting regulations applicable to credit institutions and investment firms as referred to in the aforementioned Article 89 (namely, investment firms covered by Article 4, paragraph 1, point 2 of Regulation (EU) No 575/2013 of the European Parliament and of the Council of 26 June 2013 on prudential requirements for credit institutions and investment firms and amending Regulation (EU) No 648/2012).

It is thus provided that the required information must be made public through the consolidated accounts. In this way, activities in each country, exercised directly or indirectly through subsidiaries, will be covered provided they fall within the scope of the consolidated accounts, regardless of the business sector exercised in said countries. This approach follows the recommendations of the European Banking Authority (EBA, Single Rulebook Q&A, Question ID No. 2014_1248).

Since not all institutions prepare consolidated accounts, it is necessary to provide for the same obligation to publish information as an annex to the statutory annual accounts. Institutions that prepare consolidated accounts are exempt from publishing the information as an annex to their statutory accounts.

The annual accounts and the consolidated accounts are subject to statutory audit in accordance with Directive 2006/43/EC.

In accordance with the principle advocated by the European Banking Authority (EBA, Single Rulebook Q&A, Question ID No. 2014_1249), the definition of the information elements to be published should be consistent with the audited financial statements published by the institution.

The definitions retained will therefore be adapted, depending on whether the information is included as an annex to the annual accounts (Belgian accounting standards) or as an annex to the consolidated accounts (international accounting standards – IFRS).

Pursuant to the aforementioned Article 89, this information must be made public from 1 January 2015. In accordance with the principles set out by the EBA in its Q&A No. 2014_1250, publication must be carried out through the audited accounts published after 1 January 2015. For this reason, it is proposed that the information required by the Directive be inserted in the notes to the annual or consolidated accounts published each year from 1 January 2015. For a company closing its accounts on 31 December, the first publication of this information will therefore be in the notes to its accounts closed on 31 December 2014 and published in 2015.

Article 89, paragraph 2, provides that part of this information must be made public for the first time on 1 July 2014. This aspect, for credit institutions, is already covered by Article 420 of the Law of 25 April 2014 on the status and supervision of credit institutions. This provision only concerned the publication of data in 2014, pending the adaptation of the notes to the annual accounts, which is precisely the subject of the present draft decree.

All comments from the Council of State have been taken into account.

COMMENTARY ON THE ARTICLES

Article 1. This article requires no commentary.

Art. 2. Article 2 of the present draft decree ensures the transposition into the regulations concerning the annual accounts of institutions, of Article 89 of Directive 2013/36/EU of the European Parliament and of the Council of 26 June 2013 on the access to the activity of credit institutions and the prudential supervision of credit institutions and investment firms, amending Directive 2002/87/EC and repealing Directives 2006/48/EC and 2006/49/EC.

To this end, it is proposed to add a new statement No. XXXI to be inserted as an annex to the annual accounts of institutions, and concerning the country-by-country information as referred to in the aforementioned Article 89.

Since the aforementioned Article 89 only applies to credit institutions and certain investment firms, the new statement XXXI must only be filled in by those institutions.

Art. 3. Article 3 ensures the transposition of the aforementioned Article 89 into the regulations concerning the consolidated accounts of institutions. The information required by Article 89 will be published as an annex to the consolidated accounts, supplementing the other disclosures prescribed by international accounting standards.

Art. 4. Article 4 stipulates, in accordance with the aforementioned Directive, that the information must be made public in the notes to the annual or consolidated accounts published from 1 January 2015.

I have the honour to be,
Sire,
Of Your Majesty, the very respectful and very faithful servant,

The Minister of Finance,
Johan VAN OVERTVELDT

COUNCIL OF STATE
Legislation Section
Opinion 56.693/2 of 27 October 2014 on a draft Royal Decree 'amending the Royal Decrees on the annual and consolidated accounts of credit institutions, investment firms, and management companies of collective investment undertakings'

On 1 October 2014, the Council of State, Legislation Section, was invited by the Minister of Finance to provide an opinion within a period of thirty days on a draft Royal Decree 'amending the Royal Decrees on the annual and consolidated accounts of credit institutions, investment firms, and management companies of collective investment undertakings'.

The draft was examined by the Second Chamber on 27 October 2014. The Chamber was composed of Pierre VANDERNOOT, Chamber President, Jacques JAUMOTTE and Martine BAGUET, Councillors of State, Yves DE CORDT and Marianne DONY, Assessors, and Bernadette VIGNERON, Clerk.

The report was presented by Jean-Luc PAQUET, First Auditor.

BELGIAN STATE GAZETTE — 05.12.2014 − Ed. 2 — MONITEUR BELGE 96395

The concordance between the French and Dutch versions of the opinion has been verified under the supervision of Pierre VANDERNOOT.

The opinion, the text of which follows, was given on 27 October 2014.

Since the request for opinion was submitted on the basis of Article 84, § 1, first paragraph, 2°, of the coordinated laws on the Council of State, the Legislation Section, in accordance with Article 84, § 3, of the aforementioned coordinated laws, limits its examination to the legal basis of the draft, the competence of the author of the act, and the prior formalities to be fulfilled.

Regarding these three points, the draft gives rise to the following observations.

EXAMINATION OF THE DRAFT

PREAMBLE

First paragraph

Article 91, third paragraph, 2°, of the Law of 6 April 1995 'on the status and supervision of investment firms' only concerns the consolidated annual accounts of those firms, whereas the draft also concerns their annual accounts, which are mentioned in the provision under 1° of the same paragraph.

The first paragraph must therefore read as follows:

"Having regard to the Law of 6 April 1995 on the status and supervision of investment firms, Article 91, third paragraph, amended by Article 174 of the Royal Decree of 3 March 2011, confirmed by Article 298 of the Law of 3 August 2012;"

The seventh paragraph (in fact the eighth paragraph) of Article 91 furthermore provides no legal basis for the draft. (1)

Second paragraph

Conversely, Article 106, § 1, second paragraph, 1°, of the Law of 25 April 2014 'on the status and supervision of credit institutions' only concerns the annual accounts of those institutions, whereas the draft also concerns their consolidated accounts, which are mentioned in the provision under 2° of the same paragraph.

Paragraph 5 of Article 106 furthermore provides no legal basis for the draft. (1)

The second paragraph must therefore read as follows:

"Having regard to the Law of 25 April 2014 on the status and supervision of credit institutions, Article 106, § 1, second paragraph;"

Third paragraph

The amendments previously made to the Royal Decree of 23 September 1992 "on the annual accounts of credit institutions, investment firms, and management companies of collective investment undertakings" should not be mentioned in the preamble. (2)

Fourth paragraph

The same observation applies to the amendments previously made to the Royal Decree of 23 September 1992 "on the consolidated accounts of credit institutions, investment firms, and management companies of collective investment undertakings".

Sixth paragraph

The opinion of the National Bank is dated 24 – and not 23 – July 2014.

DISPOSITION

Article 1

In the French text, the words "prévoit la transposition de" must be replaced by the word "transpose". (3)

La concordance entre la version française et la version néerlandaise a été vérifiée sous le contrôle de Pierre VANDERNOOT.

L’avis, dont le texte suit, a été donné le 27 octobre 2014.

Comme la demande d’avis est introduite sur la base de l’article 84, § 1er, alinéa 1er, 2°, des lois coordonnées sur le Conseil d’État, la section de législation limite son examen au fondement juridique du projet, à la compétence de l’auteur de l’acte ainsi qu’à l’accomplissement des formalités préalables, conformément à l’article 84, § 3, des lois coordonnées précitées.

Sur ces trois points, le projet appelle les observations suivantes.

EXAMEN DU PROJET

PRÉAMBULE

Alinéa 1er

Le 2° de l’article 91, alinéa 3, de la loi du 6 avril 1995 « relative au statut et au contrôle des entreprises d’investissement » ne porte que sur leurs comptes consolidés, alors que le projet concerne également leurs comptes annuels, qui sont mentionnés au 1° du même alinéa.

L’alinéa 1er sera dès lors rédigé comme suit :

« Vu la loi du 6 avril 1995 relative au statut et au contrôle des entreprises d’investissement, l’article 91, alinéa 3, modifié par l’article 174 de l’arrêté royal du 3 mars 2011, confirmé par l’article 298 de la loi du 3 août 2012 ; ».

L’alinéa 7 (en réalité l’alinéa 8) de l’article 91 ne procure par ailleurs aucun fondement légal au projet (1).

Alinéa 2

Le 1° de l’article 106, § 1er, alinéa 2, de la loi du 25 avril 2014 « relative au statut et au contrôle des établissements de crédit » ne porte, à l’inverse, que sur leurs comptes annuels, alors que le projet concerne également leurs comptes consolidés, qui sont visés au 2° du même alinéa.

Le paragraphe 5 de l’article 106 ne procure par ailleurs aucun fondement légal au projet (1).

L’alinéa 2 sera dès lors rédigé comme suit :

« Vu la loi du 25 avril 2014 relative au statut et au contrôle des établissements de crédit, l’article 106, § 1er, alinéa 2 ; ».

Alinéa 3

Il n’y a pas lieu de mentionner dans le préambule les modifications précédemment apportées à l’arrêté royal du 23 septembre 1992 « relatif aux comptes annuels des établissements de crédit, des entreprises d’investissement et des sociétés de gestion d’organismes de placement collectif » (2).

Alinéa 4

La même observation vaut pour les modifications précédemment apportées à l’arrêté royal du 23 septembre 1992 « relatif aux comptes consolidés des établissements de crédit, des entreprises d’investissement et des sociétés de gestion d’organismes de placement collectif ».

Alinéa 6

L’avis de la Banque nationale est daté du 24 – et non du 23 – juillet 2014.

DISPOSITIF

Article 1er

Dans la version française, les mots « prévoit la transposition de » doivent être remplacés par « transpose » (3).

96396 BELGISCH STAATSBLAD — 05.12.2014 − Ed. 2 — MONITEUR BELGE

FINAL OBSERVATION
Since the draft contains only a few articles, it does not need to be divided into chapters. If the author of the draft maintains this division, Article 1 should not be excluded from that division.
The clerk, The president,
Bernadette Vigneron Pierre Vandernoot
Notes
(1) Provisions that merely prescribe the fulfillment of prior formal requirements should not be cited as the legal basis of a decree in its preamble (Principles of legislative drafting - Guide for drafting legislative and regulatory texts, www.raadvst-consetat.be, tab "Legislative drafting", recommendation 24). (2) Ibid., recommendation 30. (3) Ibid., formula F 4-1-2-1. 27 NOVEMBER 2014. — Royal Decree amending the Royal Decrees on the annual accounts and consolidated accounts of credit institutions, investment firms and management companies of collective investment undertakings

PHILIPPE, King of the Belgians,
To all who are now and hereafter may be, Greetings.
Having regard to the Law of 6 April 1995 on the status of and supervision over investment firms, Article 91, third paragraph, amended by Article 174 of the Royal Decree of 3 March 2011, confirmed by Article 298 of the Law of 3 August 2012; Having regard to the Law of 25 April 2014 on the status of and supervision over credit institutions, Article 106, § 1, second paragraph; Having regard to the Royal Decree of 23 September 1992 on the annual accounts of credit institutions, investment firms and management companies of collective investment undertakings; Having regard to the Royal Decree of 23 September 1992 on the consolidated accounts of credit institutions, investment firms and management companies of collective investment undertakings; Having regard to the opinion of the Financial Services and Markets Authority, given on 3 July 2014; Having regard to the opinion of the National Bank, given on 24 July 2014; Having regard to the consultation of the professional associations; Having regard to opinion 56.693/2 of the Council of State, given on 27 October 2014, in application of Article 84, § 1, first paragraph, 2°, of the Laws on the Council of State, coordinated on 12 January 1973; On the proposal of the Minister of Finance, We have decided and decide:

Article 1. This Decree provides for the transposition of Article 89 of Directive 2013/36/EU of the European Parliament and of the Council of 26 June 2013 on access to the activity of credit institutions and on the prudential supervision of credit institutions and investment firms, amending Directive 2002/87/EC and repealing Directives 2006/48/EC and 2006/49/EC.

Art. 2. In the annex to the Royal Decree of 23 September 1992 on the annual accounts of credit institutions, investment firms and management companies of collective investment undertakings, last amended by the Royal Decree of 28 February 2014, a statement XXXI is inserted, worded as follows:

« XXXI. Information broken down by country:
The institutions referred to below shall include in statement No. XXXI the following information, for the past financial year, broken down by Member State and by third country in which they have an establishment:
A. Their name(s), the nature of their activities and their geographical location (country concerned); B. their turnover;
C. their number of employees on a full-time equivalent basis;
D. their profit (loss) before tax;
E. taxes on profit;
F. public subsidies received.
For the application of this provision, the country or countries in which the institution has an establishment include the countries in which it has a branch, a subsidiary or a common subsidiary within the meaning of this Decree.
By turnover is meant the sum of items I (Interest income and similar income including: from fixed-income securities), III (Income from variable-income securities), IV (Fees received) and VI (Profit (Loss) from financial transactions) of the income statement scheme. Profit (loss) before tax corresponds to the amount recorded in item XIX of the income statement scheme. Statement No. XXXI must be completed by the institutions referred to in Article 4, paragraph 1, point 3 of Regulation (EU) No 575/2013 of the European Parliament and of the Council of 26 June 2013 on prudential requirements for credit institutions and investment firms and amending Regulation (EU) No 648/2012. Statement No. XXXI need not be completed by the aforementioned institutions that prepare and publish consolidated accounts in accordance with the Royal Decree of 23 September 1992 on the consolidated accounts of credit institutions, investment firms and management companies of collective investment undertakings. ».

Art. 3. In the Royal Decree of 23 September 1992 on the consolidated accounts of credit institutions, investment firms and management companies of collective investment undertakings, an Article 6bis is inserted, worded as follows:

« Art. 6bis. The notes to the consolidated accounts shall include, in addition to the disclosures prescribed by the approved international accounting standards and insofar as they are not required by those standards, the following information, for the past financial year, broken down by Member State and by third countries in which they are established:
A. Their name(s), the nature of their activities and their geographical location (country concerned); B. their turnover;
C. their number of employees on a full-time equivalent basis;
D. their profit (loss) before tax;
E. taxes on profit;
F. public subsidies received.
For the application of this provision, the countries for which information must be provided are those in which the institution is established directly or indirectly through entities included in the consolidation scope as defined in Article 5 of this Decree. The institutions specify, following the aforementioned data, the definitions used for their calculation. These definitions must be consistent with the consolidated accounts of the institution. This provision applies only to the institutions referred to in Article 4, paragraph 1, point 3 of Regulation (EU) No 575/2013 of the European Parliament and of the Council of 26 June 2013 on prudential requirements for credit institutions and investment firms and amending Regulation (EU) No 648/2012. ».

Art. 4. The information that must be published in accordance with this Decree must be made public in the notes to the annual or consolidated accounts published from 1 January 2015.

Art. 5. This Decree enters into force on 31 December 2014.

Art. 6. The Minister responsible for Finance is charged with the implementation of this Decree.
Given at Brussels, 27 November 2014.
PHILIPPE
By the King:
The Minister of Finance,
J. VAN OVERTVELDT