Regulation (EU) 2017/2402 of the European Parliament and of the CouncilDangos y teitl llawn

CHAPTER 5 U.K. SUPERVISION

Article 29 U.K. Designation of competent authorities

[F1 1. Compliance with the obligations set out in Article 5 of this Regulation is to be supervised as follows—

(a) where the institutional investor is an insurance undertaking or a reinsurance undertaking, by the PRA;

(b) where the institutional investor is an AIFM which markets or manages AIFs in the United Kingdom, by the FCA;

(c) where the institutional investor is a management company or a UCITS which is an authorised open ended investment company as defined in section 237(3) of the 2000 Act, by the FCA;

(d) where the institutional investor is an occupational pension scheme, by the Pensions Regulator;

[F2 (e) where the institutional investor is a CRR firm, by the PRA;

(f) where the institutional investor is an FCA investment firm, by the FCA.]

2. Compliance by a sponsor with the obligations set out in Articles 6, 7, 8 and 9 of this Regulation is to be supervised by the PRA, if the sponsor is a PRA-authorised person, and in any other case by the FCA.

3. Paragraph 3A applies where an originator, original lender or SSPE is an insurance undertaking or a reinsurance undertaking, an AIFM, a management company, a UCITS which is an authorised open ended investment company, an institution for occupational retirement provision [F3 , a CRR firm or an FCA investment firm].

3A. Where this paragraph applies, compliance with the obligations set out in Articles 6, 7, 8 and 9 of this Regulation is to be supervised as follows—

(a) where the originator, original lender or SSPE is a PRA-authorised person, by the PRA;

(b) where the originator, original lender or SSPE is an institution for occupational retirement provision, by the Pensions Regulator; and

(c) in any other case by the FCA.

3B. In paragraphs (1) to (3A)—

(a) ‘AIF’ and AIFM' have the meaning given in regulations 3 and 4(1) of the Alternative Investment Fund Managers Regulation 2013;

(b) ‘CRR firm’ has the meaning given by Article 4(1)(2A) of Regulation (EU) No 575/2013;

[F4 (ba) ‘FCA investment firm’ has the meaning given by Article 4(1)(2AB) of Regulation (EU) No 575/2013;]

(c) ‘occupational pension scheme’ has the meaning given in section 1(1) of the Pension Schemes Act 1993;

(d) ‘insurance undertaking’, ‘reinsurance undertaking’ and ‘PRA-authorised person’ have the meaning given in section 417(1) of the 2000 Act;

(e) ‘management company’ has the meaning given in section 237(2) of the 2000 Act ; and

(f) ‘UCITS’ has the meaning given in section 236A of the 2000 Act.]

4. For originators, original lenders and SSPEs established in the [F5 United Kingdom in relation to which paragraph 3A does not apply, the Treasury] shall designate one or more competent authorities to supervise compliance with the obligations set out in Articles 6, 7, 8 and 9. F6 .... That obligation shall not apply with regard to those entities that are merely selling exposures under an ABCP programme or another securitisation transaction or scheme and are not actively originating exposures for the primary purpose of securitising them on a regular basis.

5. [F7 The Treasury] shall designate one or more competent authorities to supervise the compliance of originators, sponsors and SSPEs with Articles 18 to 27, and the compliance of third parties with Article 28. F8 ...

6. Paragraph 5 of this Article shall not apply with regard to those entities that are merely selling exposures under an ABCP programme or other securitisation transaction or scheme and are not actively originating exposures for the primary purpose of securitising them on a regular basis. In such a case, the originator or sponsor shall verify that those entities fulfil the relevant obligations set out in Articles 18 to 27.

F9 7. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F10 8. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Textual Amendments

F1 Art. 29(1)-(3B) substituted for Art. 29(1)-(3) (31.12.2020) by The Securitisation (Amendment) (EU Exit) Regulations 2019 (S.I. 2019/660), regs. 1(2), 26(2) (with savings in S.I. 2019/680, reg. 11); 2020 c. 1, Sch. 5 para. 1(1)

F2 Art. 29(1)(e)(f) substituted for Art. 29(1)(e) (1.1.2022) by The Financial Services Act 2021 (Prudential Regulation of Credit Institutions and Investment Firms) (Consequential Amendments and Miscellaneous Provisions) Regulations 2021 (S.I. 2021/1376), regs. 1(3), 30(4)(a) (with regs. 35, 38)

F3 Words in Art. 29(3) substituted (1.1.2022) by The Financial Services Act 2021 (Prudential Regulation of Credit Institutions and Investment Firms) (Consequential Amendments and Miscellaneous Provisions) Regulations 2021 (S.I. 2021/1376), regs. 1(3), 30(4)(b) (with regs. 35, 38)

F4 Art. 29(3B)(ba) inserted (1.1.2022) by The Financial Services Act 2021 (Prudential Regulation of Credit Institutions and Investment Firms) (Consequential Amendments and Miscellaneous Provisions) Regulations 2021 (S.I. 2021/1376), regs. 1(3), 30(4)(c) (with regs. 35, 38)

F5 Words in Art. 29(4) substituted (31.12.2020) by The Securitisation (Amendment) (EU Exit) Regulations 2019 (S.I. 2019/660), regs. 1(2), 26(3)(a) (with savings in S.I. 2019/680, reg. 11); 2020 c. 1, Sch. 5 para. 1(1)

F6 Words in Art. 29(4) omitted (31.12.2020) by virtue of The Securitisation (Amendment) (EU Exit) Regulations 2019 (S.I. 2019/660), regs. 1(2), 26(3)(b) (with savings in S.I. 2019/680, reg. 11); 2020 c. 1, Sch. 5 para. 1(1)

F7 Words in Art. 29(5) substituted (31.12.2020) by The Securitisation (Amendment) (EU Exit) Regulations 2019 (S.I. 2019/660), regs. 1(2), 26(4)(a) (with savings in S.I. 2019/680, reg. 11); 2020 c. 1, Sch. 5 para. 1(1)

F8 Words in Art. 29(5) omitted (31.12.2020) by virtue of The Securitisation (Amendment) (EU Exit) Regulations 2019 (S.I. 2019/660), regs. 1(2), 26(4)(b) (with savings in S.I. 2019/680, reg. 11); 2020 c. 1, Sch. 5 para. 1(1)

F9 Art. 29(7) omitted (31.12.2020) by virtue of The Securitisation (Amendment) (EU Exit) Regulations 2019 (S.I. 2019/660), regs. 1(2), 26(5) (with savings in S.I. 2019/680, reg. 11); 2020 c. 1, Sch. 5 para. 1(1)

F10 Art. 29(8) omitted (31.12.2020) by virtue of The Securitisation (Amendment) (EU Exit) Regulations 2019 (S.I. 2019/660), regs. 1(2), 26(5) (with savings in S.I. 2019/680, reg. 11); 2020 c. 1, Sch. 5 para. 1(1)

Article 30 U.K. Powers of the competent authorities

F11 1. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

2. [F12 Competent authorities] shall regularly review the arrangements, processes and mechanisms that originators, sponsors, SSPEs and original lenders have implemented in order to comply with this Regulation.

The review referred to in the first subparagraph shall include:

(a) the processes and mechanisms to correctly measure and retain the material net economic interest on an ongoing basis, the gathering and timely disclosure of all information to be made available in accordance with Article 7 and the credit-granting criteria in accordance with Article 9;

(b) for STS securitisations which are not securitisations within an ABCP programme, the processes and mechanisms to ensure compliance with Article 20(7) to (12), Article 21(7), and Article 22; and

(c) for STS securitisations which are securitisations within an ABCP programme, the processes and mechanisms to ensure, with regard to ABCP transactions, compliance with Article 24 and, with regard to ABCP programmes, compliance with Article 26(7) and (8).

3. Competent authorities shall require that risks arising from securitisation transactions, including reputational risks, are evaluated and addressed through appropriate policies and procedures of originators, sponsors, SSPEs and original lenders.

4. [F13 Competent authorities] shall monitor, as applicable, the specific effects that the participation in the securitisation market has on the stability of the financial institution that operates as original lender, originator, sponsor or investor as part of its prudential supervision in the field of securitisation, taking into account, without prejudice to stricter sectoral regulation:

(a) the size of capital buffers;

(b) the size of the liquidity buffers; and

(c) the liquidity risk for investors due to a maturity mismatch between their funding and investments.

[F14 Where a competent authority identifies a material risk to the financial stability of a financial institution or to the financial system as a whole, it must take action to mitigate those risks and, unless it is the PRA, report its findings to the Bank of England.]

[F15 5. Competent authorities shall monitor any suspected circumvention of the obligations set out in Article 6(2) and ensure that sanctions are applied for a circumvention.]

Textual Amendments

F11 Art. 30(1) omitted (31.12.2020) by virtue of The Securitisation (Amendment) (EU Exit) Regulations 2019 (S.I. 2019/660), regs. 1(2), 27(a) (with savings in S.I. 2019/680, reg. 11); 2020 c. 1, Sch. 5 para. 1(1)

F12 Words in Art. 30(2) substituted (31.12.2020) by The Securitisation (Amendment) (EU Exit) Regulations 2019 (S.I. 2019/660), regs. 1(2), 27(b) (with savings in S.I. 2019/680, reg. 11); 2020 c. 1, Sch. 5 para. 1(1)

F13 Words in Art. 30(4) substituted (31.12.2020) by The Securitisation (Amendment) (EU Exit) Regulations 2019 (S.I. 2019/660), regs. 1(2), 27(c)(i) (with savings in S.I. 2019/680, reg. 11); 2020 c. 1, Sch. 5 para. 1(1)

F14 Words in Art. 30(4) substituted (31.12.2020) by The Securitisation (Amendment) (EU Exit) Regulations 2019 (S.I. 2019/660), regs. 1(2), 27(c)(ii) (with savings in S.I. 2019/680, reg. 11); 2020 c. 1, Sch. 5 para. 1(1)

F15 Art. 30(5) substituted (31.12.2020) by The Securitisation (Amendment) (EU Exit) Regulations 2019 (S.I. 2019/660), regs. 1(2), 27(d) (with savings in S.I. 2019/680, reg. 11); 2020 c. 1, Sch. 5 para. 1(1)

F16 Article 31 U.K. Macroprudential oversight of the securitisation market

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Textual Amendments

F16 Arts. 31-37 omitted (31.12.2020) by virtue of The Securitisation (Amendment) (EU Exit) Regulations 2019 (S.I. 2019/660), regs. 1(2), 28 (with savings in S.I. 2019/680, reg. 11); 2020 c. 1, Sch. 5 para. 1(1)

F16 Article 32 U.K. Administrative sanctions and remedial measures

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Textual Amendments

F16 Arts. 31-37 omitted (31.12.2020) by virtue of The Securitisation (Amendment) (EU Exit) Regulations 2019 (S.I. 2019/660), regs. 1(2), 28 (with savings in S.I. 2019/680, reg. 11); 2020 c. 1, Sch. 5 para. 1(1)

F16 Article 33 U.K. Exercise of the power to impose administrative sanctions and remedial measures

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Textual Amendments

F16 Arts. 31-37 omitted (31.12.2020) by virtue of The Securitisation (Amendment) (EU Exit) Regulations 2019 (S.I. 2019/660), regs. 1(2), 28 (with savings in S.I. 2019/680, reg. 11); 2020 c. 1, Sch. 5 para. 1(1)

F16 Article 34 U.K. Criminal sanctions

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Textual Amendments

F16 Arts. 31-37 omitted (31.12.2020) by virtue of The Securitisation (Amendment) (EU Exit) Regulations 2019 (S.I. 2019/660), regs. 1(2), 28 (with savings in S.I. 2019/680, reg. 11); 2020 c. 1, Sch. 5 para. 1(1)

F16 Article 35 U.K. Notification duties

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Textual Amendments

F16 Arts. 31-37 omitted (31.12.2020) by virtue of The Securitisation (Amendment) (EU Exit) Regulations 2019 (S.I. 2019/660), regs. 1(2), 28 (with savings in S.I. 2019/680, reg. 11); 2020 c. 1, Sch. 5 para. 1(1)

F16 Article 36 U.K. Cooperation between competent authorities and the ESAs

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Textual Amendments

F16 Arts. 31-37 omitted (31.12.2020) by virtue of The Securitisation (Amendment) (EU Exit) Regulations 2019 (S.I. 2019/660), regs. 1(2), 28 (with savings in S.I. 2019/680, reg. 11); 2020 c. 1, Sch. 5 para. 1(1)

F16 Article 37 U.K. Publication of administrative sanctions

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Textual Amendments

F16 Arts. 31-37 omitted (31.12.2020) by virtue of The Securitisation (Amendment) (EU Exit) Regulations 2019 (S.I. 2019/660), regs. 1(2), 28 (with savings in S.I. 2019/680, reg. 11); 2020 c. 1, Sch. 5 para. 1(1)