The Investment Firm Regulation (EU) 2019/2033 (IFR) and the Investment Firm Directive (EU) 2019/2034 (IFD) were adopted on 27 November 2019. For the legislative text of the IFR/IFD, see here and here. This new regime establishes a separate prudential framework for investment firms. Previously all investment firms fell under the CRR/CRD IV regime together with credit institutions. The new IFR/IFD regime also has consequences for managers of investment funds with a MiFID top-up, who are authorized to provide investment services.
For more background information see the Quoted of last February on our website, here.
Dutch implementation of IFD
The IFD should have been implemented in Dutch legislation by 26 June 2021. This is also the date on which the IFR became applicable. However, the Dutch implementation process of the IFD was delayed.
The Dutch IFD Implementation Act, implementing the IFD into the Dutch Financial Supervision Act and the Dutch Bankruptcy Act, was published on the 12 October in the Official Journal and entered into force on 19 October 2021. To view the text (in Dutch only), click here. The new rules include amongst others requirements on initial capital, on the internal capital adequacy assessment process and internal risk assessment process, governance, transparency and treatment of risks, the supervisory review and evaluation process (SREP) and rules in respect of managers of investment funds with a MiFID top-up (such as own fund requirements, requirements on capital, liquidity, disclosure and reporting).
The related Regulation of the DNB and AFM on Sound Remuneration Policies (Regeling beheerst beloningsbeleid Wft 2021) and the Implementation regulation directive prudential supervision of investment firms also entered into force together with the Dutch IFD Implementation Act. The Regulation of the DNB and AFM on Sound Remuneration Policies implements the IFD remuneration rules, which apply to so-called Class 2 investment firms.
There is no transition regime under the Dutch IFD Implementation Act, this means that the new provisions are to be complied with per 19 October 2021. This also applies to the new renumeration regime under the Regulation on Sound Renumeration Policies.
In anticipation of the finalization of the Dutch IFD implementation process, the DNB made available information on the consequences of the new IFR/IFD regime and already started accepting applications to meet new requirements with respect to assessment of directors of investment holding companies. To view the DNB update (in Dutch only), see here.
Should you require any assistance in the field of Financial Regulatory, please contact your trusted adviser of our Financial Regulatory Team.