EXTRACT OF EU REGULATIONS- FINANCIAL SERVICES

Directive 2002/65/EC of the European Parliament and of the Council of 23 September 2002
concerning the distance marketing of consumer financial services and amending Council Directive
90/619/EEC and Directives 97/7/EC and 98/27/EC

Whereas:

(1) It is important, in the context of achieving the aims of the single market, to adopt measures designed to
consolidate progressively this market and those measures must contribute to attaining a high level of
consumer protection, in accordance with Articles 95 and 153 of the Treaty.

(2) Both for consumers and suppliers of financial services, the distance marketing of financial services will
constitute one of the main tangible results of the completion of the internal market.

(3) Within the framework of the internal market, it is in the interest of consumers to have access without
discrimination to the widest possible range of financial services available in the Community so that they can
choose those that are best suited to their needs. In order to safeguard freedom of choice, which is an
essential consumer right, a high degree of consumer protection is required in order to enhance consumer
confidence in distance selling.

(4) It is essential to the smooth operation of the internal market for consumers to be able to negotiate and
conclude contracts with a supplier established in other Member States, regardless of whether the supplier is
also established in the Member State in which the consumer resides.

(5) Because of their intangible nature, financial services are particularly suited to distance selling and the
establishment of a legal framework governing the distance marketing of financial services should increase
consumer confidence in the use of new techniques for the distance marketing of financial services, such as
electronic commerce.

(6) This Directive should be applied in conformity with the Treaty and with secondary law, including
Directive 2000/31/EC(4) on electronic commerce, the latter being applicable solely to the transactions which
it covers.

(7) This Directive aims to achieve the objectives set forth above without prejudice to Community or national
law governing freedom to provide services or, where applicable, host Member State control and/or
authorisation or supervision systems in the Member States where this is compatible with Community
legislation.

(8) Moreover, this Directive, and in particular its provisions relating to information about any contractual
clause on law applicable to the contract and/or on the competent court does not affect the applicability to the
distance marketing of consumer financial services of Council Regulation (EC) No 44/2001 of 22 December
2000 on jurisdiction and the recognition and enforcement of judgements in civil and commercial matters(5)
or of the 1980 Rome Convention on the law applicable to contractual obligations.

(9) The achievement of the objectives of the Financial Services Action Plan requires a higher level of
consumer protection in certain areas. This implies a greater convergence, in particular, in non harmonised
collective investment funds, rules of conduct applicable to investment services and consumer credits.
Pending the achievement of the above convergence, a high level of consumer protection should be
maintained.
(10) Directive 97/7/EC of the European Parliament and of the Council of 20 May 1997 on the protection of
consumers in respect of distance contracts(6), lays down the main rules applicable to distance contracts for
goods or services concluded between a supplier and a consumer. However, that Directive does not cover
financial services.

(11) In the context of the analysis conducted by the Commission with a view to ascertaining the need for
specific measures in the field of financial services, the Commission invited all the interested parties to
transmit their comments, notably in connection with the preparation of its Green Paper entitled "Financial
Services - Meeting Consumers' Expectations". The consultations in this context showed that there is a need
to strengthen consumer protection in this area. The Commission therefore decided to present a specific
proposal concerning the distance marketing of financial services.

(12) The adoption by the Member States of conflicting or different consumer protection rules governing the
distance marketing of consumer financial services could impede the functioning of the internal market and
competition between firms in the market. It is therefore necessary to enact common rules at Community
level in this area, consistent with no reduction in overall consumer protection in the Member States.

(13) A high level of consumer protection should be guaranteed by this Directive, with a view to ensuring the
free movement of financial services. Member States should not be able to adopt provisions other than those
laid down in this Directive in the fields it harmonises, unless otherwise specifically indicated in it.

(14) This Directive covers all financial services liable to be provided at a distance. However, certain
financial services are governed by specific provisions of Community legislation which continue to apply to
those financial services. However, principles governing the distance marketing of such services should be
laid down.

(15) Contracts negotiated at a distance involve the use of means of distance communication which are used
as part of a distance sales or service-provision scheme not involving the simultaneous presence of the
supplier and the consumer. The constant development of those means of communication requires principles
to be defined that are valid even for those means which are not yet in widespread use. Therefore, distance
contracts are those the offer, negotiation and conclusion of which are carried out at a distance.

(16) A single contract involving successive operations or separate operations of the same nature performed
over time may be subject to different legal treatment in the different Member States, but it is important that
this Directive be applied in the same way in all the Member States. To that end, it is appropriate that this
Directive should be considered to apply to the first of a series of successive operations or separate operations
of the same nature performed over time which may be considered as forming a whole, irrespective of
whether that operation or series of operations is the subject of a single contract or several successive
contracts.

(17) An "initial service agreement" may be considered to be for example the opening of a bank account,
acquiring a credit card, concluding a portfolio management contract, and "operations" may be considered to
be for example the deposit or withdrawal of funds to or from the bank account, payment by credit card,
transactions made within the framework of a portfolio management contract. Adding new elements to an
initial service agreement, such as a possibility to use an electronic payment instrument together with one's
existing bank account, does not constitute an "operation" but an additional contract to which this Directive
applies. The subscription to new units of the same collective investment fund is considered to be one of
"successive operations of the same nature".

(18) By covering a service-provision scheme organised by the financial services provider, this Directive
aims to exclude from its scope services provided on a strictly occasional basis and outside a commercial
structure dedicated to the conclusion of distance contracts.

(19) The supplier is the person providing services at a distance. This Directive should however also apply
when one of the marketing stages involves an intermediary. Having regard to the nature and degree of that
involvement, the pertinent provisions of this Directive should apply to such an intermediary, irrespective of
his or her legal status.

(20) Durable mediums include in particular floppy discs, CD-ROMs, DVDs and the hard drive of the
consumer's computer on which the electronic mail is stored, but they do not include Internet websites unless
they fulfil the criteria contained in the definition of a durable medium.

(21) The use of means of distance communications should not lead to an unwarranted restriction on the
information provided to the client. In the interests of transparency this Directive lays down the requirements
needed to ensure that an appropriate level of information is provided to the consumer both before and after
conclusion of the contract. The consumer should receive, before conclusion of the contract, the prior
information needed so as to properly appraise the financial service offered to him and hence make a well-
informed choice. The supplier should specify how long his offer applies as it stands.

(22) Information items listed in this Directive cover information of a general nature applicable to all kinds of
financial services. Other information requirements concerning a given financial service, such as the
coverage of an insurance policy, are not solely specified in this Directive. This kind of information should
be provided in accordance, where applicable, with relevant Community legislation or national legislation in
conformity with Community law.

(23) With a view to optimum protection of the consumer, it is important that the consumer is adequately
informed of the provisions of this Directive and of any codes of conduct existing in this area and that he has
a right of withdrawal.

(24) When the right of withdrawal does not apply because the consumer has expressly requested the
performance of a contract, the supplier should inform the consumer of this fact.

(25) Consumers should be protected against unsolicited services. Consumers should be exempt from any
obligation in the case of unsolicited services, the absence of a reply not being construed as signifying
consent on their part. However, this rule should be without prejudice to the tacit renewal of contracts validly
concluded between the parties whenever the law of the Member States permits such tacit renewal.

(26) Member States should take appropriate measures to protect effectively consumers who do not wish to
be contacted through certain means of communication or at certain times. This Directive should be without
prejudice to the particular safeguards available to consumers under Community legislation concerning the
protection of personal data and privacy.

(27) With a view to protecting consumers, there is a need for suitable and effective complaint and redress
procedures in the Member States with a view to settling potential disputes between suppliers and consumers,
by using, where appropriate, existing procedures.

(28) Member States should encourage public or private bodies established with a view to settling disputes
out of court to cooperate in resolving cross-border disputes. Such cooperation could in particular entail
allowing consumers to submit to extra-judicial bodies in the Member State of their residence complaints
concerning suppliers established in other Member States. The establishment of FIN-NET offers increased
assistance to consumers when using cross-border services.

(29) This Directive is without prejudice to extension by Member States, in accordance with Community law,
of the protection provided by this Directive to non-profit organisations and persons making use of financial
services in order to become entrepreneurs.

(30) This Directive should also cover cases where the national legislation includes the concept of a
consumer making a binding contractual statement.
(31) The provisions in this Directive on the supplier's choice of language should be without prejudice to
provisions of national legislation, adopted in conformity with Community law governing the choice of
language.

(32) The Community and the Member States have entered into commitments in the context of the General
Agreement on Trade in Services (GATS) concerning the possibility for consumers to purchase banking and
investment services abroad. The GATS entitles Member States to adopt measures for prudential reasons,
including measures to protect investors, depositors, policy-holders and persons to whom a financial service
is owed by the supplier of the financial service. Such measures should not impose restrictions going beyond
what is required to ensure the protection of consumers.

(33) In view of the adoption of this Directive, the scope of Directive 97/7/EC and Directive 98/27/EC of the
European Parliament and of the Council of 19 May 1998 on injunctions for the protection of consumers'
interests(7) and the scope of the cancellation period in Council Directive 90/619/EEC of 8 November 1990
on the coordination of laws, regulations and administrative provisions relating to direct life assurance, laying
down provisions to facilitate the effective exercise of freedom to provide services(8) should be adapted.

(34) Since the objectives of this Directive, namely the establishment of common rules on the distance
marketing of consumer financial services cannot be sufficiently achieved by the Member States and can
therefore be better achieved at Community level, the Community may adopt measures, in accordance with
the principles of subsidiarity as set out in Article 5 of the Treaty. In accordance with the principle of
proportionality, as set out in that Article, this Directive does not go beyond what is necessary to achieve that
objective,

Article 2

Definitions

For the purposes of this Directive:

(a) "distance contract" means any contract concerning financial services concluded between a supplier and a
consumer under an organised distance sales or service-provision scheme run by the supplier, who, for the
purpose of that contract, makes exclusive use of one or more means of distance communication up to and
including the time at which the contract is concluded;

(b) "financial service" means any service of a banking, credit, insurance, personal pension, investment or
payment nature;

(c) "supplier" means any natural or legal person, public or private, who, acting in his commercial or
professional capacity, is the contractual provider of services subject to distance contracts;

(d) "consumer" means any natural person who, in distance contracts covered by this Directive, is acting for
purposes which are outside his trade, business or profession;

(e) "means of distance communication" refers to any means which, without the simultaneous physical
presence of the supplier and the consumer, may be used for the distance marketing of a service between
those parties;

(f) "durable medium" means any instrument which enables the consumer to store information addressed
personally to him in a way accessible for future reference for a period of time adequate for the purposes of
the information and which allows the unchanged reproduction of the information stored;

(g) "operator or supplier of a means of distance communication" means any public or private, natural or
legal person whose trade, business or profession involves making one or more means of distance
communication available to suppliers.
 DIRECTIVE 2008/48/EC OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL
of 23 April 2008
on credit agreements for consumers and repealing Council Directive 87/102/EEC
(7) In order to facilitate the emergence of a well-functioning internal market in consumer credit, it is necessary
to make provision for a harmonised Community framework in a number of core areas. In view of the
continuously developing market in consumer credit and the increasing mobility of European citizens, forward-
looking Community legislation which is able to adapt to future forms of credit and which allows Member
States the appropriate degree of flexibility in their implementation should help to establish a modern body of
law on consumer credit.
(8) It is important that the market should offer a sufficient degree of consumer protection to ensure consumer
confidence. Thus, it should be possible for the free movement of credit offers to take place under optimum
conditions for both those who offer credit and those who require it, with due regard to specific situations in
the individual Member States.
(9) Full harmonisation is necessary in order to ensure that all consumers in the Community enjoy a high and
equivalent level of protection of their interests and to create a genuine internal market. Member States should
therefore not be allowed to maintain or introduce national provisions other than those laid down in this
Directive. However, such restriction should only apply where there are provisions harmonised in this
Directive. Where no such harmonised provisions exist, Member States should remain free to maintain or
introduce national legislation. Accordingly, Member States may, for instance, maintain or introduce national
provisions on joint and several liability of the seller or the service provider and the creditor. Another example
of this possibility for Member States could be the maintenance or introduction of national provisions on the
cancellation of a contract for the sale of goods or supply of services if the consumer exercises his right of
withdrawal from the credit agreement. In this respect Member States, in the case of open-end credit
agreements, should be allowed to fix a minimum period needing to elapse between the time when the creditor
asks for reimbursement and the day on which the credit has to be reimbursed.
(10) The definitions contained in this Directive determine the scope of harmonisation. The obligation on
Member States to implement the provisions of this Directive should therefore be limited to its scope as
determined by those definitions. However, this Directive should be without prejudice to the application by
Member States, in accordance with Community law, of the provisions of this Directive to areas not covered
by its scope. A Member State could thereby maintain or introduce national legislation corresponding to the
provisions of this Directive or certain of its provisions on credit agreements outside the scope of this Directive,
for instance on credit agreements involving amounts less than EUR 200 or more than EUR 75 000.
Furthermore, Member States could also apply the provisions of this Directive to linked credit which does not
fall within the definition of a linked credit agreement as contained in this Directive. Thus, the provisions on
linked credit agreements could be applied to credit agreements that serve only partially to finance a contract
for the supply of goods or provision of a service.
(13) This Directive should not apply to certain types of credit agreement, such as deferred debit cards, under
the terms of which the credit has to be repaid within three months and only insignificant charges are payable.
(14) Credit agreements covering the granting of credit secured by real estate should be excluded from the
scope of this Directive. That type of credit is of a very specific nature. Also, credit agreements the purpose of
which is to finance the acquisition or retention of property rights in land or in an existing or projected building
should be excluded from the scope of this Directive.
(19) In order to enable consumers to make their decisions in full knowledge of the facts, they should receive
adequate information, which the consumer may take away and consider, prior to the conclusion of the credit
agreement, on the conditions and cost of the credit and on their obligations. To ensure the fullest possible
transparency and comparability of offers, such information should, in particular, include the annual percentage
rate of charge applicable to the credit, determined in the same way throughout the Community. As the annual
percentage rate of charge can at this stage be indicated only through an example, such example should be
representative. Therefore, it should correspond, for instance, to the average duration and total amount of credit
granted for the type of credit agreement under consideration and, if applicable, to the goods purchased. When
determining the representative example, the frequency of certain types of credit agreement in a specific market
should also be taken into account. As regards the borrowing rate, the frequency of instalments and the
capitalisation of interest, creditors should use their conventional method of calculation for the consumer credit
concerned.
(20) The total cost of the credit to the consumer should comprise all the costs, including interest, commissions,
taxes, fees for credit intermediaries and any other fees which the consumer has to pay in connection with the
credit agreement, except for notarial costs. Creditors’ actual knowledge of the costs should be assessed
objectively, taking into account the requirements of professional diligence.

Article 3
Definitions
For the purposes of this Directive, the following definitions shall apply:
(a) ‘consumer’ means a natural person who, in transactions covered by this Directive, is acting for
purposes which are outside his trade, business or profession;
(b) ‘creditor’ means a natural or legal person who grants or promises to grant credit in the course of his
trade, business or profession;
(c) ‘credit agreement’ means an agreement whereby a creditor grants or promises to grant to a consumer
credit in the form of a deferred payment, loan or other similar financial accommodation, except for agreements
for the provision on a continuing basis of services or for the supply of goods of the same kind, where the
consumer pays for such services or goods for the duration of their provision by means of instalments;
(d) ‘overdraft facility’ means an explicit credit agreement whereby a creditor makes available to a
consumer funds which exceed the current balance in the consumer's current account;
(e) ‘overrunning’ means a tacitly accepted overdraft whereby a creditor makes available to a consumer
funds which exceed the current balance in the consumer's current account or the agreed overdraft facility;
(f) ‘credit intermediary’ means a natural or legal person who is not acting as a creditor and who, in the
course of his trade, business or profession, for a fee, which may take a pecuniary form or any other agreed
form of financial consideration:
(i) presents or offers credit agreements to consumers;
(ii) assists consumers by undertaking preparatory work in respect of credit
agreements other than as referred to in (i); or
(iii) concludes credit agreements with consumers on behalf of the creditor;
(g) ‘total cost of the credit to the consumer’ means all the costs, including interest, commissions, taxes and
any other kind of fees which the consumer is required to pay in connection with the credit agreement and
which are known to the creditor, except for notarial costs; costs in respect of ancillary services relating to the
credit agreement, in particular insurance premiums, are also included if, in addition, the conclusion of a service
contract is compulsory in order to obtain the credit or to obtain it on the terms and conditions marketed;
(h) ‘total amount payable by the consumer’ means the sum of the total amount of the credit and the total
cost of the credit to the consumer;
(i) ‘annual percentage rate of charge’ means the total cost of the credit to the consumer, expressed as an
annual percentage of the total amount of credit, where applicable including the costs referred to in Article
19(2);
(j) ‘borrowing rate’ means the interest rate expressed as a fixed or variable percentage applied on an
annual basis to the amount of credit drawn down;
(k) ‘fixed borrowing rate’ means that the creditor and the consumer agree in the credit agreement on one
borrowing rate for the entire duration of the credit agreement or on several borrowing rates for partial periods
using exclusively a fixed specific percentage. If not all borrowing rates are determined in the credit agreement,
the borrowing rate shall be deemed to be fixed only for the partial periods for which the borrowing rates are
determined exclusively by a fixed specific percentage agreed on the conclusion of the credit agreement;
(l) ‘total amount of credit’ means the ceiling or the total sums made available under a credit agreement;
(m) ‘durable medium’ means any instrument which enables the consumer to store information addressed
personally to him in a way accessible for future reference for a period of time adequate for the purposes of the
information and which allows the unchanged reproduction of the information stored;
(n) ‘linked credit agreement’ means a credit agreement where
(i) the credit in question serves exclusively to finance an agreement for the supply of specific goods or
the provision of a specific service, and
(ii) those two agreements form, from an objective point of view, a commercial unit; a commercial unit
shall be deemed to exist where the supplier or service provider himself finances the credit for the consumer
or, if it is financed by a third party, where the creditor uses the services of the supplier or service provider in
connection with the conclusion or preparation of the credit agreement, or where the specific goods or the
provision of a specific service are explicitly specified in the credit agreement.

Directive 2009/110/EC of the European Parliament and of the Council of 16 September 2009 on the
taking up, pursuit and prudential supervision of the business of electronic money institutions
amending Directives 2005/60/EC and 2006/48/EC and repealing Directive 2000/46/EC
(Text with EEA relevance)
(5) It is appropriate to limit the application of this Directive to payment service providers that issue electronic
money. This Directive should not apply to monetary value stored on specific pre-paid instruments, designed
to address precise needs that can be used only in a limited way, because they allow the electronic money
holder to purchase goods or services only in the premises of the electronic money issuer or within a limited
network of service providers under direct commercial agreement with a professional issuer, or because they
can be used only to acquire a limited range of goods or services. An instrument should be considered to be
used within such a limited network if it can be used only either for the purchase of goods and services in a
specific store or chain of stores, or for a limited range of goods or services, regardless of the geographical
location of the point of sale. Such instruments could include store cards, petrol cards, membership cards,
public transport cards, meal vouchers or vouchers for services (such as vouchers for childcare, or vouchers for
social or services schemes which subsidise the employment of staff to carry out household tasks such as
cleaning, ironing or gardening), which are sometimes subject to a specific tax or labour legal framework
designed to promote the use of such instruments to meet the objectives laid down in social legislation. Where
such a specific-purpose instrument develops into a general-purpose instrument, the exemption from the scope
of this Directive should no longer apply. Instruments which can be used for purchases in stores of listed
merchants should not be exempted from the scope of this Directive as such instruments are typically designed
for a network of service providers which is continuously growing.
(6) It is also appropriate that this Directive not apply to monetary value that is used to purchase digital goods
or services, where, by virtue of the nature of the good or service, the operator adds intrinsic value to it, e.g. in
the form of access, search or distribution facilities, provided that the good or service in question can be used
only through a digital device, such as a mobile phone or a computer, and provided that the telecommunication,
digital or information technology operator does not act only as an intermediary between the payment service
user and the supplier of the goods and services. This is a situation where a mobile phone or other digital
network subscriber pays the network operator directly and there is neither a direct payment relationship nor a
direct debtor-creditor relationship between the network subscriber and any third-party supplier of goods or
services delivered as part of the transaction.
(7) It is appropriate to introduce a clear definition of electronic money in order to make it technically neutral.
That definition should cover all situations where the payment service provider issues a pre-paid stored value
in exchange for funds, which can be used for payment purposes because it is accepted by third persons as a
payment.
(8) The definition of electronic money should cover electronic money whether it is held on a payment device
in the electronic money holder’s possession or stored remotely at a server and managed by the electronic
money holder through a specific account for electronic money. That definition should be wide enough to avoid
hampering technological innovation and to cover not only all the electronic money products available today
in the market but also those products which could be developed in the future.
Article 1
Subject matter and scope
1. This Directive lays down the rules for the pursuit of the activity of issuing electronic money to which end
the Member States shall recognise the following categories of electronic money issuer:
(a) credit institutions as defined in point 1 of Article 4 of Directive 2006/48/EC including, in accordance with
national law, a branch thereof within the meaning of point 3 of Article 4 of that Directive, where such a branch
is located within the Community and its head office is located outside the Community, in accordance with
Article 38 of that Directive;
(b) electronic money institutions as defined in point 1 of Article 2 of this Directive including, in accordance
with Article 8 of this Directive and national law, a branch thereof, where such a branch is located within the
Community and its head office is located outside the Community;
(c) post office giro institutions which are entitled under national law to issue electronic money;
(d) the European Central Bank and national central banks when not acting in their capacity as monetary
authority or other public authorities;
(e) Member States or their regional or local authorities when acting in their capacity as public authorities.
2. Title II of this Directive lays down the rules for the taking up, the pursuit and the prudential supervision
of the business of electronic money institutions.
3. Member States may waive the application of all or part of the provisions of Title II of this Directive to the
institutions referred to in Article 2 of Directive 2006/48/EC, with the exception of those referred to in the first
and second indents of that Article.
4. This Directive does not apply to monetary value stored on instruments exempted as specified in Article
3(k) of Directive 2007/64/EC.
5. This Directive does not apply to monetary value that is used to make payment transactions exempted as
specified in Article 3(l) of Directive 2007/64/EC.
Article 2
 Definitions
For the purposes of this Directive, the following definitions shall apply:
1. ‘electronic money institution’ means a legal person that has been granted authorisation under Title II
to issue electronic money;
2. ‘electronic money’ means electronically, including magnetically, stored monetary value as represented by
a claim on the issuer which is issued on receipt of funds for the purpose of making payment transactions as
defined in point 5 of Article 4 of Directive 2007/64/EC, and which is accepted by a natural or legal person
other than the electronic money issuer;
3. ‘electronic money issuer’ means entities referred to in Article 1(1), institutions benefiting from the waiver
under Article 1(3) and legal persons benefiting from a waiver under Article 9;
4. ‘average outstanding electronic money’ means the average total amount of financial liabilities related to
electronic money in issue at the end of each calendar day over the preceding six calendar months, calculated
on the first calendar day of each calendar month and applied for that calendar month.

DIRECTIVE 2009/138/EC OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL

of 25 November 2009
on the taking-up and pursuit of the business of Insurance and Reinsurance (Solvency II)

(2)In order to facilitate the taking-up and pursuit of the activities of insurance and reinsurance, it is necessary
to eliminate the most serious differences between the laws of the Member States as regards the rules to which
insurance and reinsurance undertakings are subject. A legal framework should therefore be provided for
insurance and reinsurance undertakings to conduct insurance business throughout the internal market thus
making it easier for insurance and reinsurance undertakings with head offices in the Community to cover risks
and commitments situated therein.
8)The taking-up of insurance or of reinsurance activities should be subject to prior authorisation. It is therefore
necessary to lay down the conditions and the procedure for the granting of that authorisation as well as for any
refusal.
(10) References in this Directive to insurance or reinsurance undertakings should include captive insurance
and captive reinsurance undertakings, except where specific provision is made for those undertakings.
(11) Since this Directive constitutes an essential instrument for the achievement of the internal market,
insurance and reinsurance undertakings authorised in their home Member States should be allowed to pursue,
throughout the Community, any or all of their activities by establishing branches or by providing services. It
is therefore appropriate to bring about such harmonisation as is necessary and sufficient to achieve the mutual
recognition of authorisations and supervisory systems, and thus a single authorisation which is valid
throughout the Community and which allows the supervision of an undertaking to be carried out by the home
Member State.
(13) Reinsurance undertakings should limit their objects to the business of reinsurance and related operations.
Such a requirement should not prevent a reinsurance undertaking from pursuing activities such as the provision
of statistical or actuarial advice, risk analysis or research for its clients. It may also include a holding company
function and activities with respect to financial sector activities within the meaning of Article 2(8) of Directive
2002/87/EC of the European Parliament and of the Council of 16 December 2002 on the supplementary
supervision of credit institutions, insurance undertakings and investment firms in a financial conglomerate
(18). In any event, that requirement does not allow the pursuit of unrelated banking and financial activities.
(14) The protection of policy holders presupposes that insurance and reinsurance undertakings are subject to
effective solvency requirements that result in an efficient allocation of capital across the European Union. In
light of market developments the current system is no longer adequate. It is therefore necessary to introduce
a new regulatory framework.
(16)The main objective of insurance and reinsurance regulation and supervision is the adequate protection of
policy holders and beneficiaries. The term beneficiary is intended to cover any natural or legal person who is
entitled to a right under an insurance contract. Financial stability and fair and stable markets are other
objectives of insurance and reinsurance regulation and supervision which should also be taken into account
but should not undermine the main objective.
(17) The solvency regime laid down in this Directive is expected to result in even better protection for policy
holders. It will require Member States to provide supervisory authorities with the resources to fulfil their
obligations as set out in this Directive. This encompasses all necessary capacities, including financial and
human resources.
(18) The supervisory authorities of the Member States should therefore have at their disposal all means
necessary to ensure the orderly pursuit of business by insurance and reinsurance undertakings throughout the
Community whether pursued under the right of establishment or the freedom to provide services. In order to
ensure the effectiveness of the supervision all actions taken by the supervisory authorities should be
proportionate to the nature, scale and complexity of the risks inherent in the business of an insurance or
reinsurance undertaking, regardless of the importance of the undertaking concerned for the overall financial
stability of the market.
(19) This Directive should not be too burdensome for small and medium-sized insurance undertakings. One
of the tools by which to achieve that objective is the proper application of the proportionality principle. That
principle should apply both to the requirements imposed on the insurance and reinsurance undertakings and
to the exercise of supervisory powers.
(20) In particular, this Directive should not be too burdensome for insurance undertakings that specialise in
providing specific types of insurance or services to specific customer segments, and it should recognise that
specialising in this way can be a valuable tool for efficiently and effectively managing risk. In order to achieve
that objective, as well as the proper application of the proportionality principle, provision should also be made
specifically to allow undertakings to use their own data to calibrate the parameters in the underwriting risk
modules of the standard formula of the Solvency Capital Requirement.
(21) This Directive should also take account of the specific nature of captive insurance and captive reinsurance
undertakings. As those undertakings only cover risks associated with the industrial or commercial group to
which they belong, appropriate approaches should thus be provided in line with the principle of proportionality
to reflect the nature, scale and complexity of their business.
(22) The supervision of reinsurance activity should take account of the special characteristics of reinsurance
business, notably its global nature and the fact that the policy holders are themselves insurance or reinsurance
undertakings.
(23) Supervisory authorities should be able to obtain from insurance and reinsurance undertakings the
information which is necessary for the purposes of supervision, including, where appropriate, information
publicly disclosed by an insurance or reinsurance undertaking under financial reporting, listing and other legal
or regulatory requirements.
(24) The supervisory authorities of the home Member State should be responsible for monitoring the financial
health of insurance and reinsurance undertakings. To that end, they should carry out regular reviews and
evaluations.
(25)Supervisory authorities should be able to take account of the effects on risk and asset management of
voluntary codes of conduct and transparency complied with by the relevant institutions dealing in unregulated
or alternative investment instruments.
Article 1
This Directive lays down rules concerning the following:
(1) the taking-up and pursuit, within the Community, of the self-employed activities of direct insurance
and reinsurance;
(2) the supervision of insurance and reinsurance groups;
(3) the reorganisation and winding-up of direct insurance undertakings.
Article 2
Scope

1. This Directive shall apply to direct life and non-life insurance undertakings which are established in the
territory of a Member State or which wish to become established there.
It shall also apply to reinsurance undertakings which conduct only reinsurance activities and which are
established in the territory of a Member State or which wish to become established there with the exception
of Title IV.
2. In regard to non-life insurance, this Directive shall apply to activities of the classes set out in Part A of
Annex I. For the purposes of the first subparagraph of paragraph 1, non-life insurance shall include the activity
which consists of assistance provided for persons who get into difficulties while travelling, while away from
their home or their habitual residence. It shall comprise an undertaking, against prior payment of a premium,
to make aid immediately available to the beneficiary under an assistance contract where that person is in
difficulties following the occurrence of a chance event, in the cases and under the conditions set out in the
contract.
The aid may comprise the provision of benefits in cash or in kind. The provision of benefits in kind may also
be effected by means of the staff and equipment of the person providing them.
The assistance activity shall not cover servicing, maintenance, after-sales service or the mere indication or
provision of aid as an intermediary.
3. In regard to life insurance, this Directive shall apply:
(a) to the following life insurance activities where they are on a contractual basis:
(i) life insurance which comprises assurance on survival to a stipulated age only, assurance on death
only, assurance on survival to a stipulated age or on earlier death, life assurance with return of premiums,
marriage assurance, birth assurance;
(ii) annuities;
(i) supplementary insurance underwritten in addition to life insurance, in particular, insurance
against personal injury including incapacity for employment, insurance against death resulting
from an accident and insurance against disability resulting from an accident or sickness;
(ii) types of permanent health insurance not subject to cancellation currently existing in Ireland
and the United Kingdom;

(b) to the following operations, where they are on a contractual basis, in so far as they are subject to supervision
by the authorities responsible for the supervision of private insurance:
 (i) operations whereby associations of subscribers are set up with a view to capitalising their
contributions jointly and subsequently distributing the assets thus accumulated among the
survivors or among the beneficiaries of the deceased (tontines);
(ii) capital redemption operations based on actuarial calculation whereby, in return for single or
periodic payments agreed in advance, commitments of specified duration and amount are
undertaken;
(iii) management of group pension funds, comprising the management of investments, and in
particular the assets representing the reserves of bodies that effect payments on death or
survival or in the event of discontinuance or curtailment of activity;
(iv) the operations referred to in point (iii) where they are accompanied by insurance covering either
conservation of capital or payment of a minimum interest;
(v) the operations carried out by life insurance undertakings such as those referred to in Chapter
1, Title 4 of Book IV of the French ‘Code des assurances’;

(a) to operations relating to the length of human life which are prescribed by or provided for in social
insurance legislation, in so far as they are effected or managed by life insurance undertakings at
their own risk in accordance with the laws of a Member State.

Article 3
Statutory systems
Without prejudice to Article 2(3)(c), this Directive shall not apply to insurance forming part of a statutory
system of social security.

Directive 2011/83/EU of the European Parliament and of the Council of 25 October 2011 on consumer
rights, amending Council Directive 93/13/EEC and Directive 1999/44/EC of the European Parliament
and of the Council and repealing Council Directive 85/577/EEC and Directive 97/7/EC of the
European Parliament and of the Council Text with EEA relevance

(7) Full harmonisation of some key regulatory aspects should considerably increase legal certainty for both
consumers and traders. Both consumers and traders should be able to rely on a single regulatory framework
based on clearly defined legal concepts regulating certain aspects of business-to-consumer contracts across
the Union. The effect of such harmonisation should be to eliminate the barriers stemming from the
fragmentation of the rules and to complete the internal market in this area. Those barriers can only be
eliminated by establishing uniform rules at Union level. Furthermore consumers should enjoy a high common
level of protection across the Union.
(8) The regulatory aspects to be harmonised should only concern contracts concluded between traders and
consumers. Therefore, this Directive should not affect national law in the area of contracts relating to
employment, contracts relating to succession rights, contracts relating to family law and contracts relating to
the incorporation and organisation of companies or partnership agreements.
(9) This Directive establishes rules on information to be provided for distance contracts, off-premises contracts
and contracts other than distance and off-premises contracts. This Directive also regulates the right of
withdrawal for distance and off-premises contracts and harmonises certain provisions dealing with the
performance and some other aspects of business-to-consumer contracts.
 Article 1
Subject matter

The purpose of this Directive is, through the achievement of a high level of consumer protection, to contribute
to the proper functioning of the internal market by approximating certain aspects of the laws, regulations and
administrative provisions of the Member States concerning contracts concluded between consumers and
traders.
Article 2
Definitions

For the purpose of this Directive, the following definitions shall apply:
(1) ‘consumer’ means any natural person who, in contracts covered by this Directive, is acting for purposes
which are outside his trade, business, craft or profession;
(2) ‘trader’ means any natural person or any legal person, irrespective of whether privately or publicly
owned, who is acting, including through any other person acting in his name or on his behalf, for
purposes relating to his trade, business, craft or profession in relation to contracts covered by this
Directive;
(3) ‘goods’ means any tangible movable items, with the exception of items sold by way of execution or
otherwise by authority of law; water, gas and electricity shall be considered as goods within the
meaning of this Directive where they are put up for sale in a limited volume or a set quantity;
(4) ‘goods made to the consumer’s specifications’ means non-prefabricated goods made on the basis of
an individual choice of or decision by the consumer;

(5) ‘sales contract’ means any contract under which the trader transfers or undertakes to transfer the
ownership of goods to the consumer and the consumer pays or undertakes to pay the price thereof,
including any contract having as its object both goods and services;
(6) ‘service contract’ means any contract other than a sales contract under which the trader supplies or
undertakes to supply a service to the consumer and the consumer pays or undertakes to pay the price
thereof;
(7) ‘distance contract’ means any contract concluded between the trader and the consumer under an
organised distance sales or service-provision scheme without the simultaneous physical presence of
the trader and the consumer, with the exclusive use of one or more means of distance communication
up to and including the time at which the contract is concluded;
(8) ‘off-premises contract’ means any contract between the trader and the consumer:
(a) concluded in the simultaneous physical presence of the trader and the consumer, in a place which
is not the business premises of the trader;
(b) for which an offer was made by the consumer in the same circumstances as referred to in point (a);
(c) concluded on the business premises of the trader or through any means of distance communication
immediately after the consumer was personally and individually addressed in a place which is not the
business premises of the trader in the simultaneous physical presence of the trader and the consumer;
or
(d) concluded during an excursion organised by the trader with the aim or effect of promoting and
selling goods or services to the consumer;
(9)‘business premises’ means:
 (a) any immovable retail premises where the trader carries out his activity on a permanent basis; or
(b) any movable retail premises where the trader carries out his activity on a usual basis;
(10) ‘durable medium’ means any instrument which enables the consumer or the trader to store information
addressed personally to him in a way accessible for future reference for a period of time adequate for the
purposes of the information and which allows the unchanged reproduction of the information stored;
(11) ‘digital content’ means data which are produced and supplied in digital form;
(12) ‘financial service’ means any service of a banking, credit, insurance, personal pension, investment or
payment nature;
(13) ‘public auction’ means a method of sale where goods or services are offered by the trader to consumers,
who attend or are given the possibility to attend the auction in person, through a transparent, competitive
bidding procedure run by an auctioneer and where the successful bidder is bound to purchase the goods or
services;
(14) ‘commercial guarantee’ means any undertaking by the trader or a producer (the guarantor) to the
consumer, in addition to his legal obligation relating to the guarantee of conformity, to reimburse the price
paid or to replace, repair or service goods in any way if they do not meet the specifications or any other
requirements not related to conformity set out in the guarantee statement or in the relevant advertising
available at the time of, or before the conclusion of the contract;
(15) ‘ancillary contract’ means a contract by which the consumer acquires goods or services related to a
distance contract or an off-premises contract and where those goods are supplied or those services are provided
by the trader or by a third party on the basis of an arrangement between that third party and the trader.

Directive 2013/36/EU of the European Parliament and of the Council of 26 June 2013 on access to the
activity of credit institutions and the prudential supervision of credit institutions and investment
firms, amending Directive 2002/87/EC and repealing Directives 2006/48/EC and 2006/49/EC Text with
EEA relevance
Article 1
Subject matter
This Directive lays down rules concerning:
(a) access to the activity of credit institutions and investment firms (collectively referred to as
"institutions");
(b) supervisory powers and tools for the prudential supervision of institutions by competent authorities;
(c) the prudential supervision of institutions by competent authorities in a manner that is consistent with
the rules set out in Regulation (EU) No 575/2013
(d) publication requirements for competent authorities in the field of prudential regulation and supervision
of institutions.

Article 3
Definitions
1. For the purposes of this Directive, the following definitions shall apply:
(1)‧credit institution‧ means credit institution as defined in point (1) of Article 4(1) of Regulation (EU) No
575/2013;
(2)‧investment firm‧ means investment firm as defined in point (2) of Article 4(1) of Regulation (EU) No
575/2013;
(3) ‧institution‧ means institution as defined in point (3) of Article 4(1) of Regulation (EU) No 575/2013;
(4) ‧local firm‧ means local firm as defined in point (4) of Article 4(1) of Regulation (EU) No 575/2013;
(5)‧insurance undertaking‧ means insurance undertaking as defined in point (5) of Article 4(1) of Regulation
(EU) No 575/2013;
(6)‧reinsurance undertaking‧ means reinsurance undertaking as defined in point (6) of Article 4(1) of
Regulation (EU) No 575/2013;
(7)‧management body‧ means an institution's body or bodies, which are appointed in accordance with national
law, which are empowered to set the institution's strategy, objectives and overall direction, and which
oversee and monitor management decision-making, and include the persons who effectively direct the
business of the institution;
(8)‧management body in its supervisory function‧ means the management body acting in its role of overseeing
and monitoring management decision-making;
(9)‧senior management‧ means those natural persons who exercise executive functions within an institution
and who are responsible, and accountable to the management body, for the day-to-day management of the
institution;
(10)‧systemic risk‧ means a risk of disruption in the financial system with the potential to have serious negative
consequences for the financial system and the real economy;
(11)‧model risk‧ means the potential loss an institution may incur, as a consequence of decisions that could be
principally based on the output of internal models, due to errors in the development, implementation or
use of such models;
(12) ‧originator‧ means originator as defined in point (13) of Article 4(1) of Regulation (EU) No 575/2013;
(13) ‧sponsor‧ means sponsor as defined in point (14) of Article 4(1) of Regulation (EU) No 575/2013;
(14)‧parent undertaking‧ means parent undertaking as defined in point (15) of Article 4(1) of Regulation (EU)
No 575/2013;
(15) ‧subsidiary‧ means subsidiary as defined in point (16) of Article 4(1) of Regulation (EU) No 575/2013;
(16) ‧branch‧ means branch as defined in point (17) of Article 4(1) of Regulation (EU) No 575/2013;
(17)‧ancillary services undertaking‧ means ancillary services undertaking as defined in point (18) of Article
4(1) of Regulation (EU) No 575/2013;
(18)‧asset management company‧ means asset management company as defined in point (19) of Article 4(1)
of Regulation (EU) No 575/2013;
(19)‧financial holding company‧ means financial holding company as defined in point (20) of Article 4(1) of
Regulation (EU) No 575/2013;
(20)‧mixed financial holding company‧ means mixed financial holding company as defined in point (21) of
Article 4(1) of Regulation (EU) No 575/2013;
(21)‧mixed activity holding company‧ means mixed activity holding company as defined in point (22) of
Article 4(1) of Regulation (EU) No 575/2013;
(22)‧financial institution‧ means financial institution as defined in point (26) of Article 4(1) of Regulation
(EU) No 575/2013;
(23)‧financial sector entity‧ means financial sector entity as defined in point (27) of Article 4(1) of Regulation
(EU) No 575/2013;
(24)‧parent institution in a Member State‧ means parent institution in a Member State as defined in point (28)
of Article 4(1) of Regulation (EU) No 575/2013;
(25)‧EU parent institution‧ means EU parent institution as defined in point (29) of Article 4(1) of Regulation
(EU) No 575/2013;
(26)‧parent financial holding company in a Member State‧ means parent financial holding company in a
Member State as defined in point (30) of Article 4(1) of Regulation (EU) No 575/2013;
(27)‧EU parent financial holding company‧ means EU parent financial holding company as defined in point
(31) of Article 4(1) of Regulation (EU) No 575/2013;
(28)‧parent mixed financial holding company in a Member State‧ means parent mixed financial holding
company in a Member State as defined in point (32) of Article 4(1) of Regulation (EU) No 575/2013;
(29)‧EU parent mixed financial holding company‧ means EU parent mixed financial holding company as
defined in point (33) of Article 4(1) of Regulation (EU) No 575/2013;
(30)‧systemically important institution‧ means an EU parent institution, an EU parent financial holding
company, an EU parent mixed financial holding company or an institution the failure or malfunction of
which could lead to systemic risk;
(31)‧central counterparty‧ means central counterparty as defined in point (34) of Article 4(1) of Regulation
(EU) No 575/2013;
(32)‧participation‧ means participation as defined in point (35) of Article 4(1) of Regulation (EU) No
575/2013;
(33)‧qualifying holding‧ means qualifying holding as defined in point (36) of Article 4(1) of Regulation (EU)
No 575/2013;
(34) ‧control‧ means control as defined in point (37) of Article 4(1) of Regulation (EU) No 575/2013;
(35)‧close links‧ means close links as defined in point (38) of Article 4(1) of Regulation (EU) No 575/2013;
(36)‧competent authority‧ means competent authority as defined in point (40) of Article 4(1) of Regulation
(EU) No 575/2013;
(37)‧consolidating supervisor‧ means consolidating supervisor as defined in point (41) of Article 4(1) of
Regulation (EU) No 575/2013;
(38)‧authorisation‧ means authorisation as defined in point (42) of Article 4(1) of Regulation (EU) No
575/2013;
(39)‧home Member State‧ means home Member State as defined in point (43) of Article 4(1) of Regulation
(EU) No 575/2013;
(40)‧host Member State‧ means host Member State as defined in point (44) of Article 4(1) of Regulation (EU)
No 575/2013;
(41)‧ESCB central banks‧ means ESCB central banks as defined in point (45) of Article 4(1) of Regulation
(EU) No 575/2013;
(42)‧central banks‧ means central banks as defined in point (46) of Article 4(1) of Regulation (EU) No
575/2013;
(43)‧consolidated situation‧ means consolidated situation as defined in point (47) of Article 4(1) of Regulation
(EU) No 575/2013;
(44)‧consolidated basis‧ means consolidated basis as defined in point (48) of Article 4(1) of Regulation (EU)
No 575/2013;
(45)‧sub-consolidated basis‧ means sub-consolidated basis as defined in point (49) of Article 4(1) of
Regulation (EU) No 575/2013;
(46)‧financial instrument‧ means financial instrument as defined in point (50) of Article 4(1) of Regulation
(EU) No 575/2013;
(47)‧own funds‧ means own funds as defined in point (118) of Article 4(1) of Regulation (EU) No 575/2013;
(48)‧operational risk‧ means operational risk as defined in point (52) of Article 4(1) of Regulation (EU) No
575/2013;
(49)‧credit risk mitigation‧ means credit risk mitigation as defined in point (57) of Article 4(1) of Regulation
(EU) No 575/2013;
(50)‧securitisation‧ means securitisation as defined in point (61) of Article 4(1) of Regulation (EU) No
575/2013;
(51)‧securitisation position‧ means securitisation position as defined in point (62) of Article 4(1) of Regulation
(EU) No 575/2013;
(52)‧securitisation special purpose entity‧ means securitisation special purpose entity as defined in point (66)
of Article 4(1) of Regulation (EU) No 575/2013;
(53)‧discretionary pension benefits‧ means discretionary pension benefits as defined in point (73) of Article
4(1) of Regulation (EU) No 575/2013;
(54) ‧trading book‧ means trading as defined in point (86) of Article 4(1) of Regulation (EU) No 575/2013;
(55)‧regulated market‧ means regulated market as defined in point (92) of Article 4(1) of Regulation (EU) No
575/2013;
(56) ‧leverage‧ means leverage as defined in point (93) of Article 4(1) of Regulation (EU) No 575/2013;
(57)‧risk of excessive leverage‧ means risk of excessive leverage as defined in point (94) of Article 4(1) of
Regulation (EU) No 575/2013;
(58)‧external credit assessment institution‧ means external credit assessment institution as defined in point
(98) of Article 4(1) of Regulation (EU) No 575/2013;
(59)‧internal approaches‧ means the internal ratings based approach referred to in Article 143(1), the internal
models approach referred to in Article 221, the own estimates approach referred to in Article 225, the
advanced measurement approaches referred to in Article 312(2), the internal models method referred to
in Articles 283 and 363, and the internal assessment approach referred to in Article 259(3) of Regulation
(EU) No 575/2013.
2. Where this Directive refers to the management body and, pursuant to national law, the managerial and
supervisory functions of the management body are assigned to different bodies or different members within
one body, the Member State shall identify the bodies or members of the management body responsible in
accordance with its national law, unless otherwise specified by this Directive.
 DIRECTIVE 2014/17/EU OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL
of 4 February 2014
on credit agreements for consumers relating to residential immovable property and amending
Directives 2008/48/EC and 2013/36/EU and Regulation (EU) No 1093/2010

(5)In order to facilitate the emergence of a smoothly functioning internal market with a high level of consumer
protection in the area of credit agreements relating to immovable property and in order to ensure that
consumers looking for such agreements are able to do so confident in the knowledge that the institutions they
interact with act in a professional and responsible manner, an appropriately harmonised Union legal
framework needs to be established in a number of areas, taking into account differences in credit agreements
arising in particular from differences in national and regional immovable property markets.
(6)This Directive should therefore develop a more transparent, efficient and competitive internal market,
through consistent, flexible and fair credit agreements relating to immovable property, while promoting
sustainable lending and borrowing and financial inclusion, and hence providing a high level of consumer
protection.
(13) While this Directive regulates credit agreements which solely or predominantly relate to residential
immovable property, it does not prevent Member States from extending the measures taken in accordance
with this Directive to protect consumers in relation to credit agreements related to other forms of immovable
property, or from otherwise regulating such credit agreements.
(14) The definitions set out in this Directive determine the scope of harmonisation. The obligations of Member
States to transpose this Directive should therefore be limited to its scope as determined by those definitions.
For instance, the obligations of Member States to transpose this Directive are limited to credit agreements
concluded with consumers, meaning with natural persons who, in transactions covered by this Directive, are
acting outside their trade, business or profession. Similarly, Member States are obliged to transpose provisions
of this Directive regulating the activity of persons acting as credit intermediary as defined in the Directive.
However, this Directive should be without prejudice to the application by Member States, in accordance with
Union law, of this Directive to areas not covered by its scope. In addition, the definitions set out in this
Directive should be without prejudice to the possibility for Member States to adopt sub-definitions under
national law for specific purposes, provided that they are still compliant with the definitions set out in this
Directive. For example, Member States should be allowed to determine under national law sub-categories of
credit intermediaries that are not identified in this Directive, where such sub-categories are necessary at
national level for instance to differentiate the level of knowledge and competence requirements to be fulfilled
by the different credit intermediaries.
(15) The objective of this Directive is to ensure that consumers entering into credit agreements relating to
immovable property benefit from a high level of protection. It should therefore apply to credits secured by
immovable property regardless of the purpose of the credit, refinancing agreements or other credit agreements
that would help an owner or part owner continue to retain rights in immovable property or land and credits
which are used to purchase an immovable property in some Member States including credits that do not require
the reimbursement of the capital or, unless Member States have an adequate alternative framework in place,
those whose purpose is to provide temporary financing between the sale of one immovable property and the
purchase of another, and to secured credits for the renovation of residential immovable property.

(18) Unsecured credit agreements the purpose of which is the renovation of a residential immovable property
involving a total amount of credit above EUR 75 000 should fall under the scope of Directive 2008/48/EC in
order to ensure an equivalent level of protection to those consumers and to avoid any regulatory gap between
that Directive and this Directive. Directive 2008/48/EC should therefore be amended accordingly.

Article 4
Definitions
For the purposes of this Directive, the following definitions shall apply:
(1) ‘Consumer’ means a consumer as defined in point (a) of Article 3 of Directive 2008/48/EC.
(2) ‘Creditor’ means a natural or legal person who grants or promises to grant credit falling within the
scope of Article 3 in the course of his trade, business or profession.
(3) ‘Credit agreement’ means an agreement whereby a creditor grants or promises to grant, to a consumer,
a credit falling within the scope of Article 3 in the form of a deferred payment, loan or other similar financial
accommodation.
(4) ‘Ancillary service’ means a service offered to the consumer in conjunction with the credit agreement.
(5) ‘Credit intermediary’ means a natural or legal person who is not acting as a creditor or notary and not
merely introducing, either directly or indirectly, a consumer to a creditor or credit intermediary, and who, in
the course of his trade, business or profession, for remuneration, which may take a pecuniary form or any
other agreed form of financial consideration:
(a) presents or offers credit agreements to consumers;
(b) assists consumers by undertaking preparatory work or other pre-contractual administration in respect
of credit agreements other than as referred to in point (a); or
(c) concludes credit agreements with consumers on behalf of the creditor.
(6) ‘Group’ means a group of creditors which are to be consolidated for the purposes of drawing up
consolidated accounts, as defined in Directive 2013/34/EU of the European Parliament and of the Council of
26 June 2013 on the annual financial statements, consolidated financial statements and related reports of
certain types of undertakings (20).
(7) ‘Tied credit intermediary’ means any credit intermediary who acts on behalf of and under the full and
unconditional responsibility of:
(a) only one creditor;
(b) only one group; or
(c) a number of creditors or groups which does not represent the majority of the market.
(8) ‘Appointed representative’ means a natural or legal person who performs activities referred to in point
5 that is acting on behalf of and under the full and unconditional responsibility of only one credit intermediary.
(9) ‘Credit institution’ means credit institution as defined in point 1 of Article 4(1) of Regulation (EU) No
575/2013.
(10) ‘Non-credit institution’ means any creditor that is not a credit institution.
(11) ‘Staff’ means:
(a) any natural person working for the creditor, or credit intermediary who is directly engaged in the
activities covered by this Directive or who has contacts with consumers in the course of activities covered by
this Directive;
(b) any natural person working for an appointed representative who has contacts with consumers in the
course of activities covered by this Directive;
(c) any natural person directly managing or supervising the natural persons referred to in points (a) and
(b).
(12) ‘Total amount of credit’ means the total amount of credit as defined in point (l) of Article 3 of Directive
2008/48/EC.
(13) ‘Total cost of the credit to the consumer’ means the total cost of the credit to the consumer as defined
in point (g) of Article 3 of Directive 2008/48/EC including the cost of valuation of property where such
valuation is necessary to obtain the credit but excluding registration fees for the transfer of ownership of the
immovable property. It excludes any charges payable by the consumer for non-compliance with the
commitments laid down in the credit agreement.
(14) ‘Total amount payable by the consumer’ means the total amount payable by the consumer as defined
in point (h) of Article 3 of Directive 2008/48/EC.
(15) ‘Annual percentage rate of charge’ (APRC) means the total cost of the credit to the consumer,
expressed as an annual percentage of the total amount of credit, where applicable, including the costs referred
to in Article 17(2) and equates, on an annual basis, to the present value of all future or existing commitments
(drawdowns, repayments and charges) agreed by the creditor and the consumer.
(16) ‘Borrowing rate’ means the borrowing rate as defined in point (j) of Article 3 of Directive 2008/48/EC.
(17) ‘Creditworthiness assessment’ means the evaluation of the prospect for the debt obligation resulting
from the credit agreement to be met.
(18) ‘Durable medium’ means durable medium as defined in point (m) of Article 3 of Directive
2008/48/EC.
(19) ‘Home Member State’ means:
(a) where the creditor or credit intermediary is a natural person, the Member State in which his head office
is situated;
(b) where the creditor or credit intermediary is a legal person, the Member State in which its registered
office is situated or, if under its national law it has no registered office, the Member State in which its head
office is situated.
(20) ‘Host Member State’ means the Member State, other than the home Member State, in which the
creditor or credit intermediary has a branch or provides services.
(21) ‘Advisory services’ means the provision of personal recommendations to a consumer in respect of one
or more transactions relating to credit agreements and constitutes a separate activity from the granting of a
credit and from the credit intermediation activities set out in point 5.
(22) ‘Competent authority’ means an authority designated as competent by a Member State in accordance
with Article 5.
(23) ‘Bridging loan’ means a credit agreement either of no fixed duration or which is due to be repaid within
12 months, used by the consumer as a temporary financing solution while transitioning to another financial
arrangement for the immovable property.
(24) ‘Contingent liability or guarantee’ means a credit agreement which acts as a guarantee to another
separate but ancillary transaction, and where the capital secured against an immovable property is only drawn
down if an event or events specified in the contract occur.
(25) ‘Shared equity credit agreement’ means a credit agreement where the capital repayable is based on a
contractually set percentage of the value of the immovable property at the time of the capital repayment or
repayments.
(26) ‘Tying practice’ means the offering or the selling of a credit agreement in a package with other distinct
financial products or services where the credit agreement is not made available to the consumer separately.
(27) ‘Bundling practice’ means the offering or the selling of a credit agreement in a package with other
distinct financial products or services where the credit agreement is also made available to the consumer
separately but not necessarily on the same terms or conditions as when offered bundled with the ancillary
services.
(28) ‘Foreign currency loan’ means a credit agreement where the credit is:
(a) denominated in a currency other than that in which the consumer receives the income or holds the
assets from which the credit is to be repaid; or
(b) denominated in a currency other than that of the Member State in which the consumer is resident.

DIRECTIVE 2014/65/EU OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL

of 15 May 2014
on markets in financial instruments and amending Directive 2002/92/EC and Directive 2011/61/EU

(3)In recent years more investors have become active in the financial markets and are offered an even more
complex wide-ranging set of services and instruments. In view of those developments the legal framework of
the Union should encompass the full range of investor-oriented activities. To that end, it is necessary to provide
for the degree of harmonisation needed to offer investors a high level of protection and to allow investment
firms to provide services throughout the Union, being an internal market, on the basis of home country
supervision. Directive 93/22/EEC was therefore replaced by Directive 2004/39/EC.
(12) The purpose of this Directive is to cover undertakings the regular occupation or business of which is to
provide investment services and/or perform investment activities on a professional basis. Its scope should
therefore not cover any person with a different professional activity.
(13) It is necessary to establish a comprehensive regulatory regime governing the execution of transactions in
financial instruments irrespective of the trading methods used to conclude those transactions so as to ensure a
high quality of execution of investor transactions and to uphold the integrity and overall efficiency of the
financial system. A coherent and risk-sensitive framework for regulating the main types of order-execution
arrangement currently active in the European financial marketplace should be provided for. It is necessary to
recognise the emergence of a new generation of organised trading systems alongside regulated markets which
should be subjected to obligations designed to preserve the efficient and orderly functioning of financial
markets and to ensure that such organised trading systems do not benefit from regulatory loopholes.
(14) All trading venues, namely regulated markets, multilateral trading facilities (MTFs), and OTFs, should
lay down transparent and non-discriminatory rules governing access to the facility. However, while regulated
markets and MTFs should continue to be subject to similar requirements regarding whom they may admit as
members or participants, OTFs should be able to determine and restrict access based, inter alia, on the role
and obligations which they have in relation to their clients. In that regard, trading venues should be able to
specify parameters governing the system such as minimum latency provided that that is done in an open and
transparent manner and does not involve discrimination by the platform operator.
(37) Persons who provide the investment services and/or perform investment activities covered by this
Directive should be subject to authorisation by their home Member States in order to protect investors and the
stability of the financial system.
Article 4
Definitions
1. For the purposes of this Directive, the following definitions apply:
(1) ‘investment firm’ means any legal person whose regular occupation or business is the provision of one
or more investment services to third parties and/or the performance of one or more investment activities on a
professional basis.
Member States may include in the definition of investment firms undertakings which are not legal persons,
provided that:
(a) their legal status ensures a level of protection for third parties’ interests equivalent to that afforded by
legal persons; and
(b) they are subject to equivalent prudential supervision appropriate to their legal form.
However, where a natural person provides services involving the holding of third party funds or transferable
securities, that person may be considered to be an investment firm for the purposes of this Directive and of
Regulation (EU) No 600/2014 only if, without prejudice to the other requirements imposed in this Directive,
in Regulation (EU) No 600/2014, and in Directive 2013/36/EU, that person complies with the following
conditions:
(a) the ownership rights of third parties in instruments and funds must be safeguarded, especially in the
event of the insolvency of the firm or of its proprietors, seizure, set-off or any other action by creditors of the
firm or of its proprietors;
(b) the firm must be subject to rules designed to monitor the firm’s solvency and that of its proprietors;
(c) the firm’s annual accounts must be audited by one or more persons empowered, under national law, to
audit accounts;
(d) where the firm has only one proprietor, that person must make provision for the protection of investors
in the event of the firm’s cessation of business following the proprietor’s death or incapacity or any other such
event;
(2) ‘investment services and activities’ means any of the services and activities listed in Section A of
Annex I relating to any of the instruments listed in Section C of Annex I.
The Commission shall adopt delegated acts in accordance with Article 89 measures specifying:
(a) the derivative contracts referred to in Section C.6 of Annex I that have the characteristics of wholesale
energy products that must be physically settled and C.6 energy derivative contracts;
(b) the derivative contracts referred to in Section C.7 of Annex I that have the characteristics of other
derivative financial instruments;
(c) the derivative contracts referred to in Section C.10 of Annex I that have the characteristics of other
derivative financial instruments, having regard to whether, inter alia, they are traded on a regulated market,
an MTF or an OTF;
(3) ‘ancillary services’ means any of the services listed in Section B of Annex I;
(4) ‘investment advice’ means the provision of personal recommendations to a client, either upon its
request or at the initiative of the investment firm, in respect of one or more transactions relating to financial
instruments;
(5) ‘execution of orders on behalf of clients’ means acting to conclude agreements to buy or sell one or
more financial instruments on behalf of clients and includes the conclusion of agreements to sell financial
instruments issued by an investment firm or a credit institution at the moment of their issuance;
(6) ‘dealing on own account’ means trading against proprietary capital resulting in the conclusion of
transactions in one or more financial instruments;
(7) ‘market maker’ means a person who holds himself out on the financial markets on a continuous basis
as being willing to deal on own account by buying and selling financial instruments against that person’s
proprietary capital at prices defined by that person;
(8) ‘portfolio management’ means managing portfolios in accordance with mandates given by clients on
a discretionary client-by-client basis where such portfolios include one or more financial instruments;
(9) ‘client’ means any natural or legal person to whom an investment firm provides investment or ancillary
services;
(10) ‘professional client’ means a client meeting the criteria laid down in Annex II;
(11) ‘retail client’ means a client who is not a professional client;
(12) ‘SME growth market’ means a MTF that is registered as an SME growth market in accordance with
Article 33;
(13) ‘small and medium-sized enterprises’ for the purposes of this Directive, means companies that had an
average market capitalisation of less than EUR 200 000 000 on the basis of end-year quotes for the previous
three calendar years;
(14) ‘limit order’ means an order to buy or sell a financial instrument at its specified price limit or better
and for a specified size;
(15) ‘financial instrument’ means those instruments specified in Section C of Annex I;
(16) ‘C6 energy derivative contracts’ means options, futures, swaps, and any other derivative contracts
mentioned in Section C.6 of Annex I relating to coal or oil that are traded on an OTF and must be physically
settled;
(17) ‘money-market instruments’ means those classes of instruments which are normally dealt in on the
money market, such as treasury bills, certificates of deposit and commercial papers and excluding instruments
of payment;
(18) ‘market operator’ means a person or persons who manages and/or operates the business of a regulated
market and may be the regulated market itself;
(19) ‘multilateral system’ means any system or facility in which multiple third-party buying and selling
trading interests in financial instruments are able to interact in the system;
(20) ‘systematic internaliser’ means an investment firm which, on an organised, frequent systematic and
substantial basis, deals on own account when executing client orders outside a regulated market, an MTF or
an OTF without operating a multilateral system;
The frequent and systematic basis shall be measured by the number of OTC trades in the financial instrument
carried out by the investment firm on own account when executing client orders. The substantial basis shall
be measured either by the size of the OTC trading carried out by the investment firm in relation to the total
trading of the investment firm in a specific financial instrument or by the size of the OTC trading carried out
by the investment firm in relation to the total trading in the Union in a specific financial instrument. The
definition of a systematic internaliser shall apply only where the pre-set limits for a frequent and systematic
basis and for a substantial basis are both crossed or where an investment firm chooses to opt-in under the
systematic internaliser regime;
(21) ‘regulated market’ means a multilateral system operated and/or managed by a market operator, which
brings together or facilitates the bringing together of multiple third-party buying and selling interests in
financial instruments – in the system and in accordance with its non-discretionary rules – in a way that results
in a contract, in respect of the financial instruments admitted to trading under its rules and/or systems, and
which is authorised and functions regularly and in accordance with Title III of this Directive;
(22) ‘multilateral trading facility’ or ‘MTF’ means a multilateral system, operated by an investment firm or
a market operator, which brings together multiple third-party buying and selling interests in financial
instruments – in the system and in accordance with non-discretionary rules – in a way that results in a contract
in accordance with Title II of this Directive;
(23) ‘organised trading facility’ or ‘OTF’ means a multilateral system which is not a regulated market or
an MTF and in which multiple third-party buying and selling interests in bonds, structured finance products,
emission allowances or derivatives are able to interact in the system in a way that results in a contract in
accordance with Title II of this Directive;
(24) ‘trading venue’ means a regulated market, an MTF or an OTF;
(25) ‘liquid market’ means a market for a financial instrument or a class of financial instruments, where
there are ready and willing buyers and sellers on a continuous basis, assessed in accordance with the following
criteria, taking into consideration the specific market structures of the particular financial instrument or of the
particular class of financial instruments:
(a) the average frequency and size of transactions over a range of market conditions, having regard to the
nature and life cycle of products within the class of financial instrument;
(b) the number and type of market participants, including the ratio of market participants to traded
instruments in a particular product;
(c) the average size of spreads, where available;
(26) ‘competent authority’ means the authority, designated by each Member State in accordance with
Article 67, unless otherwise specified in this Directive;
(27) ‘credit institution’ means a credit institution as defined in point (1) of Article 4(1) of Regulation (EU)
No 575/2013;
(28) ‘UCITS management company’ means a management company as defined in point (b) of Article 2(1)
of Directive 2009/65/EC of the European Parliament and of the Council (43);
(29) ‘tied agent’ means a natural or legal person who, under the full and unconditional responsibility of
only one investment firm on whose behalf it acts, promotes investment and/or ancillary services to clients or
prospective clients, receives and transmits instructions or orders from the client in respect of investment
services or financial instruments, places financial instruments or provides advice to clients or prospective
clients in respect of those financial instruments or services;
(30) ‘branch’ means a place of business other than the head office which is a part of an investment firm,
which has no legal personality and which provides investment services and/or activities and which may also
perform ancillary services for which the investment firm has been authorised; all the places of business set up
in the same Member State by an investment firm with headquarters in another Member State shall be regarded
as a single branch;
(31) ‘qualifying holding’ means a direct or indirect holding in an investment firm which represents 10 %
or more of the capital or of the voting rights, as set out in Articles 9 and 10 of Directive 2004/109/EC of the
European Parliament and of the Council (44), taking into account the conditions regarding aggregation thereof
laid down in Article 12(4) and (5) of that Directive, or which makes it possible to exercise a significant
influence over the management of the investment firm in which that holding subsists;
(32) ‘parent undertaking’ means a parent undertaking within the meaning of Article 2(9) and 22 of Directive
2013/34/EU of the European Parliament and of the Council (45);
(33) ‘subsidiary’ means a subsidiary undertaking within the meaning of Articles 2(10) and 22 of Directive
2013/34/EU, including any subsidiary of a subsidiary undertaking of an ultimate parent undertaking;
(34) ‘group’ means a group as defined in Article 2(11) of Directive 2013/34/EU;
(35) ‘close links’ means a situation in which two or more natural or legal persons are linked by:
(a) participation in the form of ownership, direct or by way of control, of 20 % or more of the voting rights
or capital of an undertaking;
(b) ‘control’ which means the relationship between a parent undertaking and a subsidiary, in all the cases
referred to in Article 22(1) and (2) of Directive 2013/34/EU, or a similar relationship between any natural or
legal person and an undertaking, any subsidiary undertaking of a subsidiary undertaking also being considered
to be a subsidiary of the parent undertaking which is at the head of those undertakings;
(c) a permanent link of both or all of them to the same person by a control relationship;
(36) ‘management body’ means the body or bodies of an investment firm, market operator or data reporting
services provider, which are appointed in accordance with national law, which are empowered to set the
entity’s strategy, objectives and overall direction, and which oversee and monitor management decision-
making and include persons who effectively direct the business of the entity.
Where this Directive refers to the management body and, pursuant to national law, the managerial and
supervisory functions of the management body are assigned to different bodies or different members within
one body, the Member State shall identify the bodies or members of the management body responsible in
accordance with its national law, unless otherwise specified by this Directive;
(37) ‘senior management’ means natural persons who exercise executive functions within an investment
firm, a market operator or a data reporting services provider and who are responsible, and accountable to the
management body, for the day-to-day management of the entity, including for the implementation of the
policies concerning the distribution of services and products to clients by the firm and its personnel;
(38) ‘matched principal trading’ means a transaction where the facilitator interposes itself between the
buyer and the seller to the transaction in such a way that it is never exposed to market risk throughout the
execution of the transaction, with both sides executed simultaneously, and where the transaction is concluded
at a price where the facilitator makes no profit or loss, other than a previously disclosed commission, fee or
charge for the transaction;
(39) ‘algorithmic trading’ means trading in financial instruments where a computer algorithm automatically
determines individual parameters of orders such as whether to initiate the order, the timing, price or quantity
of the order or how to manage the order after its submission, with limited or no human intervention, and does
not include any system that is only used for the purpose of routing orders to one or more trading venues or for
the processing of orders involving no determination of any trading parameters or for the confirmation of orders
or the post-trade processing of executed transactions;
(40) ‘high-frequency algorithmic trading technique’ means an algorithmic trading technique characterised
by:
(a) infrastructure intended to minimise network and other types of latencies, including at least one of the
following facilities for algorithmic order entry: co-location, proximity hosting or high-speed direct electronic
access;
(b) system-determination of order initiation, generation, routing or execution without human intervention
for individual trades or orders; and
(c) high message intraday rates which constitute orders, quotes or cancellations;
(41) ‘direct electronic access’ means an arrangement where a member or participant or client of a trading
venue permits a person to use its trading code so the person can electronically transmit orders relating to a
financial instrument directly to the trading venue and includes arrangements which involve the use by a person
of the infrastructure of the member or participant or client, or any connecting system provided by the member
or participant or client, to transmit the orders (direct market access) and arrangements where such an
infrastructure is not used by a person (sponsored access);
(42) ‘cross-selling practice’ means the offering of an investment service together with another service or
product as part of a package or as a condition for the same agreement or package;
(43) ‘structured deposit’ means a deposit as defined in point (c) of Article 2(1) of Directive 2014/49/EU of
the European Parliament and of the Council (46), which is fully repayable at maturity on terms under which
interest or a premium will be paid or is at risk, according to a formula involving factors such as:
(a) an index or combination of indices, excluding variable rate deposits whose return is directly linked to
an interest rate index such as Euribor or Libor;
(b) a financial instrument or combination of financial instruments;
(c) a commodity or combination of commodities or other physical or non-physical non-fungible assets; or
(d) a foreign exchange rate or combination of foreign exchange rates;
(44) ‘transferable securities’ means those classes of securities which are negotiable on the capital market,
with the exception of instruments of payment, such as:
(a) shares in companies and other securities equivalent to shares in companies, partnerships or other
entities, and depositary receipts in respect of shares;
(b) bonds or other forms of securitised debt, including depositary receipts in respect of such securities;
(c) any other securities giving the right to acquire or sell any such transferable securities or giving rise to
a cash settlement determined by reference to transferable securities, currencies, interest rates or yields,
commodities or other indices or measures;
(45) ‘depositary receipts’ means those securities which are negotiable on the capital market and which
represent ownership of the securities of a non-domiciled issuer while being able to be admitted to trading on
a regulated market and traded independently of the securities of the non-domiciled issuer;
(46) ‘exchange-traded fund’ means a fund of which at least one unit or share class is traded throughout the
day on at least one trading venue and with at least one market maker which takes action to ensure that the
price of its units or shares on the trading venue does not vary significantly from its net asset value and, where
applicable, from its indicative net asset value;
(47) ‘certificates’ means certificates as defined in Article 2(1)(27) of Regulation (EU) No 600/2014;
(48) ‘structured finance products’ means structured finance products as defined in Article 2(1)(28) of
Regulation (EU) No 600/2014;
(49) ‘derivatives’ means derivatives as defined in Article 2(1)(29) of Regulation (EU) No 600/2014;
(50) ‘commodity derivatives’ means commodity derivatives as defined in Article 2(1)(30) of Regulation
(EU) No 600/2014;
(51) ‘CCP’ means a CCP as defined in Article 2(1) of Regulation (EU) No 648/2012;
(52) ‘approved publication arrangement’ or ‘APA’ means a person authorised under this Directive to
provide the service of publishing trade reports on behalf of investment firms pursuant to Articles 20 and 21 of
Regulation (EU) No 600/2014;
(53) ‘consolidated tape provider’ or ‘CTP’ means a person authorised under this Directive to provide the
service of collecting trade reports for financial instruments listed in Articles 6, 7, 10, 12 and 13, 20 and 21 of
Regulation (EU) No 600/2014 from regulated markets, MTFs, OTFs and APAs and consolidating them into
a continuous electronic live data stream providing price and volume data per financial instrument;
(54) ‘approved reporting mechanism’ or ‘ARM’ means a person authorised under this Directive to provide
the service of reporting details of transactions to competent authorities or to ESMA on behalf of investment
firms;
(55) ‘home Member State’ means:
(a) in the case of investment firms:
(i) if the investment firm is a natural person, the Member State in which its head office is situated;
(ii) if the investment firm is a legal person, the Member State in which its registered office is situated;
(iii) if the investment firm has, under its national law, no registered office, the Member State in which its
head office is situated;
(b) in the case of a regulated market, the Member State in which the regulated market is registered or, if
under the law of that Member State it has no registered office, the Member State in which the head office of
the regulated market is situated;
(c) in the case of an APA, a CTP or an ARM:
(i) if the APA, CTP or ARM is a natural person, the Member State in which its head office is situated;
(ii) if the APA, CTP or ARM is a legal person, the Member State in which its registered office is situated;
(iii) if the APA, CTP or ARM has, under its national law, no registered office, the Member State in which
its head office is situated;
(56) ‘host Member State’ means the Member State, other than the home Member State, in which an
investment firm has a branch or provides investment services and/or activities, or the Member State in which
a regulated market provides appropriate arrangements so as to facilitate access to trading on its system by
remote members or participants established in that same Member State;
(57) ‘third-country firm’ means a firm that would be a credit institution providing investment services or
performing investment activities or an investment firm if its head office or registered office were located
within the Union;
(58) ‘wholesale energy product’ means wholesale energy products as defined in point (4) of Article 2 of
Regulation (EU) No 1227/2011;
(59) ‘agricultural commodity derivatives’ means derivative contracts relating to products listed in Article 1
of, and Annex I, Parts I to XX and XXIV/1, to, Regulation (EU) No 1308/2013 of the European Parliament
and of the Council (47);
(60) ‘sovereign issuer’ means any of the following that issues debt instruments:
(i) the Union;
(ii) a Member State, including a government department, an agency, or a special purpose vehicle of the
Member State;
(iii) in the case of a federal Member State, a member of the federation;
(iv) a special purpose vehicle for several Member States;
(v) an international financial institution established by two or more Member States which has the purpose
of mobilising funding and provide financial assistance to the benefit of its members that are experiencing or
threatened by severe financing problems; or
(vi) the European Investment Bank;
(61) ‘sovereign debt’ means a debt instrument issued by a sovereign issuer;
(62) ‘durable medium’ means any instrument which:
(a) enables a client to store information addressed personally to that client in a way accessible for future
reference and for a period of time adequate for the purposes of the information; and
(b) allows the unchanged reproduction of the information stored;
(63) ‘data reporting services provider’ means an APA, a CTP or an ARM.

DIRECTIVE (EU) 2015/2366 OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL

of 25 November 2015
on payment services in the internal market, amending Directives 2002/65/EC, 2009/110/EC and
2013/36/EU and Regulation (EU) No 1093/2010, and repealing Directive 2007/64/EC

(6) New rules should be established to close the regulatory gaps while at the same time providing more legal
clarity and ensuring consistent application of the legislative framework across the Union. Equivalent operating
conditions should be guaranteed, to existing and new players on the market, enabling new means of payment
to reach a broader market, and ensuring a high level of consumer protection in the use of those payment
services across the Union as a whole. This should generate efficiencies in the payment system as a whole and
lead to more choice and more transparency of payment services while strengthening the trust of consumers in
a harmonised payments market.
(7) In recent years, the security risks relating to electronic payments have increased. This is due to the growing
technical complexity of electronic payments, the continuously growing volumes of electronic payments
worldwide and emerging types of payment services. Safe and secure payment services constitute a vital
condition for a well-functioning payment services market. Users of payment services should therefore be
adequately protected against such risks. Payment services are essential for the functioning of vital economic
and social activities.
(8) The provisions of this Directive on transparency and information requirements for payment service
providers and on rights and obligations in relation to the provision and use of payment services should also
apply, where appropriate, to transactions where one of the payment service providers is located outside the
European Economic Area (EEA) in order to avoid divergent approaches across Member States to the detriment
of consumers. Where appropriate, those provisions should be extended to transactions in all official currencies
between payment service providers that are located within the EEA.
(21) The definition of payment services should be technologically neutral and should allow for the
development of new types of payment services, while ensuring equivalent operating conditions for both
existing and new payment service providers.
(22) This Directive should follow the approach taken in Directive 2007/64/EC, which covers all types of
electronic payment services. It would therefore not be appropriate for the new rules to apply to services where
the transfer of funds from the payer to the payee or their transport is executed solely in bank notes and coins
or where the transfer is based on a paper cheque, paper-based bill of exchange, promissory note or other
instrument, paper-based vouchers or cards drawn upon a payment service provider or other party with a view
to placing funds at the disposal of the payee.
(23) This Directive should not apply to payment transactions made in cash since a single payments market for
cash already exists. Nor should this Directive apply to payment transactions based on paper cheques since, by
their nature, paper cheques cannot be processed as efficiently as other means of payment. Good practice in
that area should, however, be based on the principles set out in this Directive.
(25) This Directive lays down rules on the execution of payment transactions where the funds are electronic
money as defined in Directive 2009/110/EC. This Directive does not, however, regulate the issuance of
electronic money as provided for in Directive 2009/110/EC. Therefore, payment institutions should not be
allowed to issue electronic money.

Article 4
Definitions
For the purposes of this Directive, the following definitions apply:
(1) ‘home Member State’ means either of the following:
(a) the Member State in which the registered office of the payment service provider is situated; or
(b) if the payment service provider has, under its national law, no registered office, the Member State in
which its head office is situated;
(2) ‘host Member State’ means the Member State other than the home Member State in which a payment
service provider has an agent or a branch or provides payment services;
(3) ‘payment service’ means any business activity set out in Annex I;
(4) ‘payment institution’ means a legal person that has been granted authorisation in accordance with
Article 11 to provide and execute payment services throughout the Union;
(5) ‘payment transaction’ means an act, initiated by the payer or on his behalf or by the payee, of placing,
transferring or withdrawing funds, irrespective of any underlying obligations between the payer and the payee;
(6) ‘remote payment transaction’ means a payment transaction initiated via internet or through a device
that can be used for distance communication;
(7) ‘payment system’ means a funds transfer system with formal and standardised arrangements and
common rules for the processing, clearing and/or settlement of payment transactions;
(8) ‘payer’ means a natural or legal person who holds a payment account and allows a payment order from
that payment account, or, where there is no payment account, a natural or legal person who gives a payment
order;
(9) ‘payee’ means a natural or legal person who is the intended recipient of funds which have been the
subject of a payment transaction;
(10) ‘payment service user’ means a natural or legal person making use of a payment service in the capacity
of payer, payee, or both;
(11) ‘payment service provider’ means a body referred to in Article 1(1) or a natural or legal person
benefiting from an exemption pursuant to Article 32 or 33;
(12) ‘payment account’ means an account held in the name of one or more payment service users which is
used for the execution of payment transactions;
(13) ‘payment order’ means an instruction by a payer or payee to its payment service provider requesting
the execution of a payment transaction;
(14) ‘payment instrument’ means a personalised device(s) and/or set of procedures agreed between the
payment service user and the payment service provider and used in order to initiate a payment order;
(15) ‘payment initiation service’ means a service to initiate a payment order at the request of the payment
service user with respect to a payment account held at another payment service provider;
(16) ‘account information service’ means an online service to provide consolidated information on one or
more payment accounts held by the payment service user with either another payment service provider or with
more than one payment service provider;
(17) ‘account servicing payment service provider’ means a payment service provider providing and
maintaining a payment account for a payer;
(18) ‘payment initiation service provider’ means a payment service provider pursuing business activities as
referred to in point (7) of Annex I;
(19) ‘account information service provider’ means a payment service provider pursuing business activities
as referred to in point (8) of Annex I;
(20) ‘consumer’ means a natural person who, in payment service contracts covered by this Directive, is
acting for purposes other than his or her trade, business or profession;
(21) ‘framework contract’ means a payment service contract which governs the future execution of
individual and successive payment transactions and which may contain the obligation and conditions for
setting up a payment account;
(22) ‘money remittance’ means a payment service where funds are received from a payer, without any
payment accounts being created in the name of the payer or the payee, for the sole purpose of transferring a
corresponding amount to a payee or to another payment service provider acting on behalf of the payee, and/or
where such funds are received on behalf of and made available to the payee;
(23) ‘direct debit’ means a payment service for debiting a payer’s payment account, where a payment
transaction is initiated by the payee on the basis of the consent given by the payer to the payee, to the payee’s
payment service provider or to the payer’s own payment service provider;
(24) ‘credit transfer’ means a payment service for crediting a payee’s payment account with a payment
transaction or a series of payment transactions from a payer’s payment account by the payment service
provider which holds the payer’s payment account, based on an instruction given by the payer;
(25) ‘funds’ means banknotes and coins, scriptural money or electronic money as defined in point (2) of
Article 2 of Directive 2009/110/EC;
(26) ‘value date’ means a reference time used by a payment service provider for the calculation of interest
on the funds debited from or credited to a payment account;
(27) ‘reference exchange rate’ means the exchange rate which is used as the basis to calculate any currency
exchange and which is made available by the payment service provider or comes from a publicly available
source;
(28) ‘reference interest rate’ means the interest rate which is used as the basis for calculating any interest to
be applied and which comes from a publicly available source which can be verified by both parties to a
payment service contract;
(29) ‘authentication’ means a procedure which allows the payment service provider to verify the identity
of a payment service user or the validity of the use of a specific payment instrument, including the use of the
user’s personalised security credentials;
(30) ‘strong customer authentication’ means an authentication based on the use of two or more elements
categorised as knowledge (something only the user knows), possession (something only the user possesses)
and inherence (something the user is) that are independent, in that the breach of one does not compromise the
reliability of the others, and is designed in such a way as to protect the confidentiality of the authentication
data;
(31) ‘personalised security credentials’ means personalised features provided by the payment service
provider to a payment service user for the purposes of authentication;
(32) ‘sensitive payment data’ means data, including personalised security credentials which can be used to
carry out fraud. For the activities of payment initiation service providers and account information service
providers, the name of the account owner and the account number do not constitute sensitive payment data;
(33) ‘unique identifier’ means a combination of letters, numbers or symbols specified to the payment
service user by the payment service provider and to be provided by the payment service user to identify
unambiguously another payment service user and/or the payment account of that other payment service user
for a payment transaction;
(34) ‘means of distance communication’ means a method which, without the simultaneous physical
presence of the payment service provider and the payment service user, may be used for the conclusion of a
payment services contract;
(35) ‘durable medium’ means any instrument which enables the payment service user to store information
addressed personally to that payment service user in a way accessible for future reference for a period of time
adequate to the purposes of the information and which allows the unchanged reproduction of the information
stored;
(36) ‘microenterprise’ means an enterprise, which at the time of conclusion of the payment service contract,
is an enterprise as defined in Article 1 and Article 2(1) and (3) of the Annex to Recommendation 2003/361/EC;
(37) ‘business day’ means a day on which the relevant payment service provider of the payer or the payment
service provider of the payee involved in the execution of a payment transaction is open for business as
required for the execution of a payment transaction;
(38) ‘agent’ means a natural or legal person who acts on behalf of a payment institution in providing
payment services;
(39) ‘branch’ means a place of business other than the head office which is a part of a payment institution,
which has no legal personality and which carries out directly some or all of the transactions inherent in the
business of a payment institution; all of the places of business set up in the same Member State by a payment
institution with a head office in another Member State shall be regarded as a single branch;
(40) ‘group’ means a group of undertakings which are linked to each other by a relationship referred to in
Article 22(1), (2) or (7) of Directive 2013/34/EU or undertakings as defined in Articles 4, 5, 6 and 7 of
Commission Delegated Regulation (EU) No 241/2014 (29), which are linked to each other by a relationship
referred to in Article 10(1) or in Article 113(6) or (7) of Regulation (EU) No 575/2013;
(41) ‘electronic communications network’ means a network as defined in point (a) of Article 2 of Directive
2002/21/EC of the European Parliament and of the Council (30);
(42) ‘electronic communications service’ means a service as defined in point (c) of Article 2 of Directive
2002/21/EC;
(43) ‘digital content’ means goods or services which are produced and supplied in digital form, the use or
consumption of which is restricted to a technical device and which do not include in any way the use or
consumption of physical goods or services;
(44) ‘acquiring of payment transactions’ means a payment service provided by a payment service provider
contracting with a payee to accept and process payment transactions, which results in a transfer of funds to
the payee;
(45) ‘issuing of payment instruments’ means a payment service by a payment service provider contracting
to provide a payer with a payment instrument to initiate and process the payer’s payment transactions;
(46) ‘own funds’ means funds as defined in point 118 of Article 4(1) of Regulation (EU) No 575/2013
where at least 75 % of the Tier 1 capital is in the form of Common Equity Tier 1 capital as referred to in
Article 50 of that Regulation and Tier 2 is equal to or less than one third of Tier 1 capital;
(47) ‘payment brand’ means any material or digital name, term, sign, symbol or combination of them,
capable of denoting under which payment card scheme card-based payment transactions are carried out;
(48) ‘co-badging’ means the inclusion of two or more payment brands or payment applications of the same
payment brand on the same payment instrument.

ANNEX I PAYMENT SERVICES

(as referred to in point (3) of Article 4)
1. Services enabling cash to be placed on a payment account as well as all the operations required for
operating a payment account.
2. Services enabling cash withdrawals from a payment account as well as all the operations required for
operating a payment account.
3. Execution of payment transactions, including transfers of funds on a payment account with the user’s
payment service provider or with another payment service provider:
(a) execution of direct debits, including one-off direct debits;
(b) execution of payment transactions through a payment card or a similar device;
(c) execution of credit transfers, including standing orders.
4. Execution of payment transactions where the funds are covered by a credit line for a payment service
user:
(b) execution of direct debits, including one-off direct debits;
(c) execution of payment transactions through a payment card or a similar device;
(d) execution of credit transfers, including standing orders.
5. Issuing of payment instruments and/or acquiring of payment transactions.
6. Money remittance.
7. Payment initiation services.
8. Account information services.
 DIRECTIVE (EU) 2016/97 OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL
of 20 January 2016
on insurance distribution (recast)

(2)Since the main objective and subject matter of this recast is to harmonise national provisions concerning
insurance and reinsurance distribution, and since those activities are carried out across the Union, this new
Directive should be based on Article 53(1) and Article 62 of the Treaty on the Functioning of the European
Union (TFEU). The form of a directive is appropriate in order to enable the implementing provisions in the
areas covered by this Directive, when necessary, to be adjusted to any existing specificities of the particular
market and legal system in each Member State. This Directive should also aim at coordinating national
rules concerning access to the activities of insurance and reinsurance distribution.
(3)However, this Directive is aimed at minimum harmonisation and should therefore not preclude Member
States from maintaining or introducing more stringent provisions in order to protect customers, provided
that such provisions are consistent with Union law, including this Directive.
(4)Insurance and reinsurance intermediaries play a central role in the distribution of insurance and reinsurance
products in the Union.
(5)Various types of persons or institutions, such as agents, brokers and ‘bancassurance’ operators, insurance
undertakings, travel agents and car rental companies can distribute insurance products. Equality of
treatment between operators and customer protection requires that all those persons or institutions be
covered by this Directive.
(6)Consumers should benefit from the same level of protection despite the differences between distribution
channels. In order to guarantee that the same level of protection applies and that the consumer can benefit
from comparable standards, in particular in the area of the disclosure of information, a level playing field
between distributors is essential.
(7)The application of Directive 2002/92/EC has shown that a number of provisions require further precision
with a view to facilitating the exercise of insurance distribution and that the protection of consumers
requires an extension of the scope of that Directive to all sales of insurance products. Insurance
undertakings which sell insurance products directly should be brought within the scope of this Directive on
a similar basis to insurance agents and brokers.
(8)In order to guarantee that the same level of protection applies regardless of the channel through which
customers buy an insurance product, either directly from an insurance undertaking or indirectly from an
intermediary, the scope of this Directive needs to cover not only insurance undertakings or intermediaries,
but also other market participants who sell insurance products on an ancillary basis, such as travel agents
and car rental companies, unless they meet the conditions for exemption.
(9)There are still substantial differences between national provisions which create barriers to the taking-up
and pursuit of the activities of insurance and reinsurance distribution in the internal market. There is a need
to strengthen further the internal market and promote a true internal market for life and non-life insurance
products and services.
(11)This Directive should apply to persons whose activity consists of providing insurance or reinsurance
distribution services to third parties.
(12) This Directive should apply to persons whose activity consists of the provision of information on one or
more contracts of insurance in response to criteria selected by the customer, whether via a website or other
media, or the provision of a ranking of insurance products or a discount on the price of an insurance contract
when the customer is able to directly or indirectly conclude an insurance contract at the end of the process.
This Directive should not apply to websites managed by public authorities or consumers’ associations which
do not aim to conclude any contract but merely compare insurance products available on the market.
(13) This Directive should not apply to mere introducing activities consisting of the provision of data and
information on potential policyholders to insurance or reinsurance intermediaries or undertakings or of
information about insurance or reinsurance products or an insurance or reinsurance intermediary or
undertaking to potential policyholders.
(16) This Directive should ensure that the same level of consumer protection applies and that all consumers
can benefit from comparable standards. This Directive should promote a level playing field and competition
on equal terms between intermediaries, whether or not they are tied to an insurance undertaking. There is a
benefit to consumers if insurance products are distributed through different channels and through
intermediaries with different forms of cooperation with insurance undertakings, provided that they are
required to apply similar rules on consumer protection. Such concerns should be taken into account by the
Member States in the implementation of this Directive.
(17)This Directive should take into account the differences in the types of distribution channel. It should, for
example, take into account the characteristics of insurance intermediaries who are under a contractual
obligation to conduct insurance distribution business exclusively with one or more insurance undertakings
(tied insurance intermediaries) which exist in certain Member States’ markets, and should establish
appropriate and proportionate conditions applicable to the different types of distribution. In particular,
Member States should be able to stipulate that the insurance or reinsurance distributor which is responsible
for the activity of an insurance, reinsurance or ancillary insurance intermediary is to ensure that such
intermediary meets the conditions for registration and is to register that intermediary.
(18) Insurance, reinsurance and ancillary insurance intermediaries who are natural persons should be
registered with the competent authority of the Member State where they have their residence. With regard to
those persons commuting on a daily basis between the Member State of their private residence and the Member
State from which they carry out their distribution activity, i.e. their professional residence, the Member State
of registration should be that of the professional residence. Those insurance, reinsurance and ancillary
insurance intermediaries who are legal persons should be registered with the competent authority of the
Member State where they have their registered office or, if under their national law they have no registered
office, their head office. Member States should be able to allow other bodies to cooperate with competent
authorities in the registration and regulation of insurance intermediaries. Insurance, reinsurance and ancillary
insurance intermediaries should be registered provided that they meet strict professional requirements in
relation to their ability, good repute, professional indemnity cover and financial capacity. Intermediaries
already registered in Member States should not be required to register again under this Directive.
(33) For insurance intermediaries and insurance undertakings that advise on, or sell, insurance-based
investment products to retail customers, Member States should ensure that they possess an appropriate level
of knowledge and competence in relation to the products offered. Such knowledge and competence are
particularly important given the increased complexity and continuous innovation in the design of insurance-
based investment products. Buying an insurance-based investment product implies a risk and investors should
be able to rely on the information and quality of assessments provided. Furthermore, employees should be
given adequate time and resources to be able to provide all relevant information to customers about the
products that they provide.
(40) Customers should be provided in advance with clear information about the status of the persons who sell
insurance products and about the type of remuneration which they receive. Such information should be given
to the customer at the pre-contractual stage. Its role is to show the relationship between the insurance
undertaking and the intermediary, where applicable, as well as the type of the intermediary’s remuneration.
(41) In order to provide a customer with information on the insurance distribution services provided, regardless
of whether the customer purchases through an intermediary or directly from an insurance undertaking, and to
avoid distortion of competition by encouraging insurance undertakings to sell directly to customers rather than
via intermediaries in order to avoid information requirements, insurance undertakings should also be required
to provide information to customers about the nature of the remuneration their employees receive for the sale
of insurance products.
(45)Where advice is provided prior to the sale of an insurance product, in addition to the duty to specify the
customers’ demands and needs, a personalised recommendation should be provided to the customer explaining
why a particular product best meets the customer’s insurance demands and needs.

Article 2
Definitions
1. For the purposes of this Directive:
(1) ‘insurance distribution’ means the activities of advising on, proposing, or carrying out other work
preparatory to the conclusion of contracts of insurance, of concluding such contracts, or of assisting in the
administration and performance of such contracts, in particular in the event of a claim, including the provision
of information concerning one or more insurance contracts in accordance with criteria selected by customers
through a website or other media and the compilation of an insurance product ranking list, including price and
product comparison, or a discount on the price of an insurance contract, when the customer is able to directly
or indirectly conclude an insurance contract using a website or other media;
(2) ‘reinsurance distribution’ means the activities of advising on, proposing, or carrying out other work
preparatory to the conclusion of contracts of reinsurance, of concluding such contracts, or of assisting in the
administration and performance of such contracts, in particular in the event of a claim, including when carried
out by a reinsurance undertaking without the intervention of a reinsurance intermediary;
(3) ‘insurance intermediary’ means any natural or legal person, other than an insurance or reinsurance
undertaking or their employees and other than an ancillary insurance intermediary, who, for remuneration,
takes up or pursues the activity of insurance distribution;
(4) ‘ancillary insurance intermediary’ means any natural or legal person, other than a credit institution or an
investment firm as defined in points (1) and (2) of Article 4(1) of Regulation (EU) No 575/2013 of the
European Parliament and of the Council (12), who, for remuneration, takes up or pursues the activity of
insurance distribution on an ancillary basis, provided that all the following conditions are met:
(a) the principal professional activity of that natural or legal person is other than insurance distribution;
(b) the natural or legal person only distributes certain insurance products that are complementary to a
good or service;
(c)the insurance products concerned do not cover life assurance or liability risks, unless that cover
complements the good or service which the intermediary provides as its principal professional activity;
(5)‘reinsurance intermediary’ means any natural or legal person, other than a reinsurance undertaking or its
employees, who, for remuneration, takes up or pursues the activity of reinsurance distribution;
(6)‘insurance undertaking’ means an undertaking as defined in Article 13 point 1 of Directive 2009/138/EC
of the European Parliament and of the Council (13);
(7) ‘reinsurance undertaking’ means a reinsurance undertaking as defined in Article 13 point 4 of Directive
2009/138/EC;
(8) ‘insurance distributor’ means any insurance intermediary, ancillary insurance intermediary or insurance
undertaking;
(9)‘remuneration’ means any commission, fee, charge or other payment, including an economic benefit of any
kind or any other financial or non-financial advantage or incentive offered or given in respect of insurance
distribution activities;
(10)‘home Member State’ means:
(a) where the intermediary is a natural person, the Member State in which his or her residence is
situated;
(b) where the intermediary is a legal person, the Member State in which its registered office is situated
or, if under its national law it has no registered office, the Member State in which its head office is situated;
(11) ‘host Member State’ means the Member State in which an insurance or reinsurance intermediary has a
permanent presence or establishment or provides services, and which is not its home Member State;
(12) ‘branch’ means an agency or a branch of an intermediary which is located in the territory of a Member
State other than the home Member State;
(13) ‘close links’ means close links as defined in Article 13 point 17 of Directive 2009/138/EC;
(14) ‘primary place of business’ means the location from where the main business is managed;
(15) ‘advice’ means the provision of a personal recommendation to a customer, either upon their request or at
the initiative of the insurance distributor, in respect of one or more insurance contracts;
(16) ‘large risks’ means large risks as defined in Article 13 point 27 of Directive 2009/138/EC;
(17) ‘insurance-based investment product’ means an insurance product which offers a maturity or surrender
value and where that maturity or surrender value is wholly or partially exposed, directly or indirectly, to market
fluctuations, and does not include:
(a) non-life insurance products as listed in Annex I to Directive 2009/138/EC (Classes of non-life
insurance);
(b) life insurance contracts where the benefits under the contract are payable only on death or in respect
of incapacity due to injury, sickness or disability;
(c) pension products which, under national law, are recognised as having the primary purpose of
providing the investor with an income in retirement, and which entitle the investor to certain benefits;
(d) officially recognised occupational pension schemes falling under the scope of Directive
2003/41/EC or Directive 2009/138/EC;
(e) individual pension products for which a financial contribution from the employer is required by
national law and where the employer or the employee has no choice as to the pension product or
provider;
(18) ‘durable medium’ means any instrument which:
(a) enables a customer to store information addressed personally to that customer in a way accessible
for future reference and for a period of time adequate for the purposes of the information; and
(b) allows the unchanged reproduction of the information stored.

2. For the purposes of points (1) and (2) of paragraph 1, the following shall not be considered to constitute
insurance distribution or reinsurance distribution:
(a) the provision of information on an incidental basis in the context of another professional activity where:
 (iii) the provider does not take any additional steps to assist in concluding or performing an
insurance contract;
(iv) the purpose of that activity is not to assist the customer in concluding or performing a
reinsurance contract;
(b) the management of claims of an insurance undertaking or of a reinsurance undertaking on a professional
basis, and loss adjusting and expert appraisal of claims;
(c) the mere provision of data and information on potential policyholders to insurance intermediaries,
reinsurance intermediaries, insurance undertakings or reinsurance undertakings where the provider does not
take any additional steps to assist in the conclusion of an insurance or reinsurance contract;
(d) the mere provision of information about insurance or reinsurance products, an insurance intermediary, a
reinsurance intermediary, an insurance undertaking or a reinsurance undertaking to potential policyholders
where the provider does not take any additional steps to assist in the conclusion of an insurance or reinsurance
contract.