Changes to the Regulatory and Prudential Requirements for European Investment Firms
Regulation (EU) 2019/2033 on the prudential requirements of investment firms and Directive (EU) 2019/2034 on the prudential supervision of investment firms (collectively, "IFR/IFD Framework") significantly change the regulatory and prudential environment of investment firms. The Framework categorizes investment firms based on a combination of quantitative criteria with other criteria (such as the types of investment services provided) and introduces major changes in the prudential regime of investment firms based on K-factors.
The IFR/IFD Framework left a great number of issues to be dealt with by the level 2 implementation acts. In this context, this summer the European Banking Authority published a Consultation Paper relating to prudential requirements, reporting, and disclosure by investment firms and remuneration issues.
The purpose of this White Paper is to outline, in a Q&A format, the main changes stemming from the IFR/IFD Framework and challenges that investment firms will be facing in the coming months.
