Article 3 — Intragroup transactions

Financial servicesLevel 1RegulationEMIRIn forceVerifiedOfficial source

1.In relation to a non-financial counterparty, an intragroup transaction shall be an OTC derivative contract entered into with another counterparty which is part of the same group provided that the following conditions are met:

Copy link

3(1)(a)

(a)both counterparties are included in the same consolidation on a full basis and they are subject to appropriate centralised risk evaluation, measurement and control procedures; and

Copy link

3(1)(b)

(b)that other counterparty is established in the Union or, if it is established in a third country, that third country is not identified under paragraph 4 or under the delegated acts adopted pursuant to paragraph 5.

Copy link

3(2)

2.In relation to a financial counterparty, an intragroup transaction shall be any of the following:

Copy link

3(2)(a)

(a)an OTC derivative contract entered into with another counterparty which is part of the same group, provided that all of the following conditions are met:

Copy link

3(2)(a)(i)

(i)the financial counterparty is established in the Union or, if it is established in a third country, that third country is not identified under paragraph 4 or under the delegated acts adopted pursuant to paragraph 5;

Copy link

3(2)(a)(ii)

(ii)the other counterparty is a financial counterparty, a financial holding company, a financial institution or an ancillary services undertaking subject to appropriate prudential requirements;

Copy link

3(2)(a)(iii)

(iii)both counterparties are included in the same consolidation on a full basis; and

Copy link

3(2)(a)(iv)

(iv)both counterparties are subject to appropriate centralised risk evaluation, measurement and control procedures;

Copy link

3(2)(b)

(b)an OTC derivative contract entered into with another counterparty where both counterparties are part of the same institutional protection scheme, referred to in Article 113(7) of Regulation (EU) No 575/2013, provided that the condition set out in point (a)(ii) of this paragraph is met;

Copy link

3(2)(c)

(c)an OTC derivative contract entered into between credit institutions affiliated to the same central body or between such credit institution and the central body, as referred to in Article 10(1) of Regulation (EU) No 575/2013;

Copy link

3(2)(d)

(d)an OTC derivative contract entered into with a non-financial counterparty which is part of the same group, provided that the following conditions are met:

Copy link

3(2)(d)(i)

(i)both counterparties to the derivative contract are included in the same consolidation on a full basis and they are subject to appropriate centralised risk evaluation, measurement and control procedures; and

Copy link

3(2)(d)(ii)

(ii)the non-financial counterparty is established in the Union or, if it is established in a third country, that third country is not identified under paragraph 4 or under the delegated acts adopted pursuant to paragraph 5.

Copy link

3(3)

3.For the purposes of this Article, counterparties shall be considered to be included in the same consolidation when both counterparties are any of the following:

Copy link

3(3)(a)

(a)included in a consolidation in accordance with Directive 2013/34/EU of the European Parliament and of the Council or with the International Financial Reporting Standards (IFRS) adopted pursuant to Regulation (EC) No 1606/2002 or, in relation to a group the parent undertaking of which has its head office in a third country, in accordance with generally accepted accounting principles of a third country determined to be equivalent to IFRS in accordance with Commission Regulation (EC) No 1569/2007 (or accounting standards of a third country the use of which is permitted in accordance with Article 4 of that Regulation); or

Copy link

3(3)(b)

(b)covered by the same consolidated supervision in accordance with Directive 2013/36/EU or, in relation to a group the parent undertaking of which has its head office in a third country, the same consolidated supervision by a third-country competent authority verified as equivalent to that governed by the principles laid down in Article 127 of that Directive.

Copy link

3(4)

4.For the purposes of this Article, transactions with counterparties established in any of the following third countries shall not benefit from any of the exemptions for intragroup transactions:

Copy link

3(4)(a)

(a)where the third country is a high-risk third country, as referred to in Article 9 of Directive (EU) 2015/849 of the European Parliament and of the Council;

Copy link

3(4)(b)

(b)where the third country is listed in Annex I to the Council conclusions on the revised EU list of non-cooperative jurisdictions for tax purposes in its most up-to-date version.

Copy link

3(5)

5.Where appropriate due to identified issues in the legal, supervisory and enforcement arrangements of a third country and where those issues result in increased risks, including counterparty credit risk and legal risk, the Commission is empowered to adopt delegated acts in accordance with Article 82 to supplement this Regulation by identifying the third countries whose entities are not permitted to benefit from any of the exemptions for intragroup transactions despite those third countries not being third countries as referred to in paragraph 4 of this Article.

Copy link