S.L. 330.6 Art. 5Scope of supplementary supervision of regulated entities.

(1) Without prejudice to the provisions on supervision contained in the sectoral rules, regulated entities which are part of a financial conglomerate in terms of these regulations shall be subject to supplementary supervision to the extent and in the manner prescribed by these regulations.

(2) The following regulated entities shall be subject to supplementary supervision at the level of the financial conglomerate in accordance with these regulations:

(a) every regulated entity which is at the head of a financial conglomerate;

(b) every regulated entity, the parent undertaking of which is a mixed financial holding company which has its head office in the European Union; and

(c) every regulated entity linked with another financial sector entity by a relationship within the meaning of Article 12(1) of Directive 83/349/EEC: Provided that where a financial conglomerate is a subgroup of another financial conglomerate which has at its head a regulated entity the Authority, together with the other relevant competent authorities, may agree that the provisions of these regulations and the provisions of the Financial Conglomerates Directive may be applied to the regulated entities within the latter group and any reference in these regulations to the terms "group" and "financial conglomerate" will then be understood as referring to that latter group.

(3) A regulated entity which is not subject to supplementary supervision in accordance with sub-regulation (2), the parent undertaking of which is a regulated entity or a mixed financial holding company which has its head office in a third country, shall be subject to supplementary supervision at the level of the financial conglomerate to the extent and in the manner prescribed in regulation 24.

(4) Where a person holds a participation or capital ties in one or more regulated entities or otherwise exercises significant influence over such entities other than the cases referred to in sub-regulations (2) and (3), the Authority, in agreement with the other relevant competent authorities, shall determine whether and to what extent supplementary supervision of the regulated entities is to be carried out in the same manner as if they constitute a financial conglomerate.

(5) In order to apply supplementary supervision, at least one of the entities must be a regulated entity as defined in regulation 2(1) and the conditions prescribed in paragraphs (a)(ii) or (b)(ii) and ( )(iii) or ( )(iii) of the definition of the term "financial a b conglomerates" in regulation 2 must be satisfied. The Authority in agreement with the other relevant competent authorities shall take into account the objectives of the supplementary supervision as provided for by these regulations in taking its decision.

(6) For the purposes of applying the provisions of sub-regulation (4) to cooperative groups, the Authority, in agreement with the other relevant competent authorities, shall take into account the public financial commitment of these groups with respect to other financial entities.

(7) Without prejudice to regulation 15, the exercise of supplementary supervision at the level of the financial conglomerate shall in no way imply that the Authority or another coordinator is required to play a supervisory role in relation to mixed financial holding companies, third-country regulated entities in a financial conglomerate or unregulated entities in a financial conglomerate on a stand-alone basis.