Search Legislation

Regulation (EU) 2019/2033 of the European Parliament and of the CouncilShow full title

Regulation (EU) 2019/2033 of the European Parliament and of the Council of 27 November 2019 on the prudential requirements of investment firms and amending Regulations (EU) No 1093/2010, (EU) No 575/2013, (EU) No 600/2014 and (EU) No 806/2014 (Text with EEA relevance)

 Help about what version

What Version

 Help about advanced features

Advanced Features

 Help about opening options

Opening Options

 Help about UK-EU Regulation

Legislation originating from the EU

When the UK left the EU, legislation.gov.uk published EU legislation that had been published by the EU up to IP completion day (31 December 2020 11.00 p.m.). On legislation.gov.uk, these items of legislation are kept up-to-date with any amendments made by the UK since then.

Close

This item of legislation originated from the EU

Legislation.gov.uk publishes the UK version. EUR-Lex publishes the EU version. The EU Exit Web Archive holds a snapshot of EUR-Lex’s version from IP completion day (31 December 2020 11.00 p.m.).

Changes to legislation:

This version of this Regulation was derived from EUR-Lex on IP completion day (31 December 2020 11:00 p.m.). It has not been amended by the UK since then. Find out more about legislation originating from the EU as published on legislation.gov.uk. Help about Changes to Legislation

Close

Changes to Legislation

Revised legislation carried on this site may not be fully up to date. At the current time any known changes or effects made by subsequent legislation have been applied to the text of the legislation you are viewing by the editorial team. Please see ‘Frequently Asked Questions’ for details regarding the timescales for which new effects are identified and recorded on this site.

CHAPTER 1 U.K. General principles

Article 15U.K.K‐factor requirement and applicable coefficients

1.For the purposes of point (c) of Article 11(1), the K‐factor requirement shall amount to at least the sum of the following:

(a)Risk‐to‐Client (RtC) K‐factors calculated in accordance with Chapter 2;

(b)Risk‐to‐Market (RtM) K‐factors calculated in accordance with Chapter 3;

(c)Risk‐to‐Firm (RtF) K‐factors calculated in accordance with Chapter 4.

2.The following coefficients shall apply to the corresponding K‐factors:

Table 1
K‐FACTORSCOEFFICIENT
Assets under management under both discretionary portfolio management and nondiscretionary advisory arrangements of an ongoing natureK‐AUM0,02 %
Client money heldK‐CMH (on segregated accounts)0,4 %
K‐CMH (on non‐segregated accounts)0,5 %
Assets safeguarded and administeredK‐ASA0,04 %
Client orders handledK‐COH cash trades0,1 %
K‐COH derivatives0,01 %
Daily trading flowK‐DTF cash trades0,1 %
K‐DTF derivatives0,01 %

3.Investment firms shall monitor the value of their K‐factors for any trends that could leave them with a materially different own funds requirement for the purposes of Article 11 for the following reporting period under Part Seven and shall notify their competent authority of that materially different own funds requirement.

4.Where competent authorities consider that there has been a material change in the business activities of an investment firm that impacts the amount of a relevant K‐factor, they may adjust the corresponding amount in accordance with point (a) of Article 39(2) of Directive (EU) 2019/2034.

5.In order to ensure the uniform application of this Regulation and to take account of developments in financial markets, EBA shall, in consultation with ESMA, develop draft regulatory technical standards to:

(a)specify the methods for measuring the K‐factors in Title II of Part Three;

(b)specify the notion of segregated accounts for the purposes of this Regulation for the conditions that ensure the protection of client money in the event of the failure of an investment firm;

(c)specify adjustments to the K‐DTF coefficients referred to in Table 1 of paragraph 2 of this Article in the event that, in stressed market condition as referred to in Commission Delegated Regulation (EU) 2017/578(1), the K‐DTF requirements seem overly restrictive and detrimental to financial stability.

EBA shall submit those draft regulatory technical standards to the Commission by 26 December 2020.

Power is delegated to the Commission to supplement this Regulation by adopting the regulatory technical standards referred to in the first subparagraph in accordance with Articles 10 to 14 of Regulation (EU) No 1093/2010.

(1)

Commission Delegated Regulation (EU) 2017/578 of 13 June 2016 supplementing Directive 2014/65/EU of the European Parliament and of the Council on markets in financial instruments with regard to regulatory technical standards specifying the requirements on market making agreements and schemes (OJ L 87, 31.3.2017, p. 183).

Back to top

Options/Help

Print Options

Close

Legislation is available in different versions:

Latest Available (revised):The latest available updated version of the legislation incorporating changes made by subsequent legislation and applied by our editorial team. Changes we have not yet applied to the text, can be found in the ‘Changes to Legislation’ area.

Original (As adopted by EU): The original version of the legislation as it stood when it was first adopted in the EU. No changes have been applied to the text.

Close

See additional information alongside the content

Geographical Extent: Indicates the geographical area that this provision applies to. For further information see ‘Frequently Asked Questions’.

Show Timeline of Changes: See how this legislation has or could change over time. Turning this feature on will show extra navigation options to go to these specific points in time. Return to the latest available version by using the controls above in the What Version box.

Close

Opening Options

Different options to open legislation in order to view more content on screen at once

Close

More Resources

Access essential accompanying documents and information for this legislation item from this tab. Dependent on the legislation item being viewed this may include:

  • the original print PDF of the as adopted version that was used for the EU Official Journal
  • lists of changes made by and/or affecting this legislation item
  • all formats of all associated documents
  • correction slips
  • links to related legislation and further information resources
Close

Timeline of Changes

This timeline shows the different versions taken from EUR-Lex before exit day and during the implementation period as well as any subsequent versions created after the implementation period as a result of changes made by UK legislation.

The dates for the EU versions are taken from the document dates on EUR-Lex and may not always coincide with when the changes came into force for the document.

For any versions created after the implementation period as a result of changes made by UK legislation the date will coincide with the earliest date on which the change (e.g an insertion, a repeal or a substitution) that was applied came into force. For further information see our guide to revised legislation on Understanding Legislation.

Close

More Resources

Use this menu to access essential accompanying documents and information for this legislation item. Dependent on the legislation item being viewed this may include:

  • the original print PDF of the as adopted version that was used for the print copy
  • correction slips

Click 'View More' or select 'More Resources' tab for additional information including:

  • lists of changes made by and/or affecting this legislation item
  • confers power and blanket amendment details
  • all formats of all associated documents
  • links to related legislation and further information resources