Commission Delegated Regulation (EU) 2016/1075Show full title

CHAPTER IV U.K. INDEPENDENCE OF VALUERS

Article 37 U.K. Definitions

For the purposes of this Chapter, the following definitions apply:

(1)

‘appointing authority’ means the legal or natural person responsible for selecting and appointing the independent valuer for the purposes of conducting the valuation referred to in Article 36(1) or Article 74(1) of Directive 2014/59/EU;

(2)

‘relevant entity’ means an institution or an entity referred to in point (b), (c) or (d) of Article 1(1) of Directive 2014/59/EU whose assets and liabilities are to be valued pursuant to Article 36 or 74 of Directive 2014/59/EU;

(3)

‘relevant public authority’ means the appointing authority, the resolution authority or the authorities referred to in points (a) to (h) of Article 83(2) of Directive 2014/59/EU, and the first authority referred to in point (i) of Article 83(2) of Directive 2014/59/EU.

Article 38 U.K. Elements of independence

A legal or natural person may be appointed as a valuer. The valuer shall be deemed to be independent from any relevant public authority and the relevant entity where all the following conditions are met:

(1)

the valuer possesses the qualifications, experience, ability, knowledge and resources required and can carry out the valuation effectively without undue reliance on any relevant public authority or the relevant entity in accordance with Article 39;

(2)

the valuer is legally separated from the relevant public authorities and the relevant entity in accordance with Article 40;

(3)

the valuer has no material common or conflicting interest within the meaning of Article 41.

Article 39 U.K. Qualifications, experience, ability, knowledge and resources

1. The independent valuer shall possess the necessary qualifications, experience, ability and knowledge in all matters considered relevant by the appointing authority.

2. The independent valuer shall hold, or have access to, such human and technical resources as the appointing authority considers appropriate to carry out the valuation. The assessment of adequacy of resources shall take into account the nature, size and complexity of the valuation to be performed.

3. In relation to the conduct of the valuation the independent valuer shall not:

(a) seek nor take instructions or guidance from any relevant public authority or the relevant entity;

(b) seek nor accept financial or other advantages from any relevant public authority or the relevant entity.

4. Paragraph 3 shall not prevent:

(a) the provision of instructions, guidance, premises, technical equipment or other forms of support where, in the assessment of the appointing authority, or such other authority as may be empowered to conduct this task in the Member State concerned, this is considered necessary for achieving the goals of the valuation;

(b) the payment to the independent valuer of such remuneration and expenses as are reasonable in connection with the conduct of the valuation.

Article 40 U.K. Structural separation

1. The independent valuer shall be a person separate from any relevant public authority, including the resolution authority, and the relevant entity.

2. For the purposes of paragraph 1, the following requirements shall apply:

(a) in relation to natural persons, the independent valuer shall not be an employee or contractor of any relevant public authority or the relevant entity;

(b) in relation to legal persons, the independent valuer shall not belong to the same group of companies as any relevant public authority or the relevant entity.

Article 41 U.K. Material common or conflicting interests

1. The independent valuer shall not have an actual or potential material interest in common or in conflict with any relevant public authority or the relevant entity.

2. For the purposes of paragraph 1 an actual or potential interest shall be deemed material whenever, in the assessment of the appointing authority or such other authority as may be empowered to perform this task in the Member State concerned, it could influence, or be reasonably perceived to influence, the independent valuer's judgement in carrying out the valuation.

3. For the purposes of paragraph 1 interests in common or in conflict with at least the following parties shall be relevant:

(a) the senior management and the members of the management body of the relevant entity;

(b) the legal or natural persons who control or have a qualifying holding in the relevant entity;

(c) the creditors identified by the appointing authority, or such other authority as may be empowered to perform this task in the Member State concerned, to be significant on the basis of the information available to the appointing authority or such other authority as may be empowered to perform this task in the Member State concerned;

(d) each group entity.

4. For the purposes of paragraph 1 at least the following matters shall be relevant:

(a) the provision by the independent valuer of services, including the past provision of services, to the relevant entity and the persons referred to in paragraph 3, and in particular the link between those services and the elements relevant for the valuation;

(b) personal and financial relationships between the independent valuer and the relevant entity and the persons referred to in paragraph 3;

(c) investments or other material financial interests of the independent valuer;

(d) in relation to legal persons, any structural separation or other arrangements that shall be put in place to address any threats to independence such as self-review, self-interest, advocacy, familiarity, trust or intimidation, including arrangements to differentiate between those staff members who may be involved in the valuation and other staff members.

5. Without prejudice to paragraphs 3 and 4, a person shall be deemed to have an actual material interest in common or in conflict with the relevant entity where the independent valuer, in the year preceding the date on which that person's eligibility to act as independent valuer is assessed, has completed a statutory audit of the relevant entity pursuant to Directive 2006/46/EC of the European Parliament and of the Council(1).

6. Any person considered for the position of independent valuer, or appointed as an independent valuer shall:

(a) maintain, in accordance with any applicable codes of ethics and professional standards, policies and procedures to identify any actual or potential interest which may be considered to constitute a material interest in accordance with paragraph 2;

(b) without delay notify the appointing authority or such other authority as may be empowered to perform the task referred to in paragraph 2 in the Member State concerned of any actual or potential interest which the independent valuer considers may, in the assessment of the authority, be considered to amount to a material interest in accordance with paragraph 2;

(c) take appropriate steps to ensure that none of the staff or other persons involved in carrying out the valuation have any material interest of a kind as referred to in paragraph 2.

(1)

Directive 2006/46/EC of the European Parliament and of the Council of 14 June 2006 amending Council Directives 78/660/EEC on the annual accounts of certain types of companies, 83/349/EEC on consolidated accounts, 86/635/EEC on the annual accounts and consolidated accounts of banks and other financial institutions and 91/674/EEC on the annual accounts and consolidated accounts of insurance undertakings (OJ L 224, 16.8.2006, p. 1.)