EBA consults on Guidelines on authorisation of TCBs under CRD6

Introduction and purpose

On 3 November 2025, the European Banking Authority (EBA) published a consultation paper on draft Guidelines for the authorisation of third country branches (TCBs) in the EU, pursuant to Article 48c(8) of Directive 2024/1619/EU (CRD6). These Guidelines aim to harmonise the information, procedures, and assessment criteria for TCB authorisation across Member States, supporting the new minimum harmonisation regime for TCBs introduced by CRD6. The consultation is open for comments until 3 February 2026.

The Guidelines are designed to ensure a transparent, consistent, and proportionate approach to the authorisation of TCBs, thereby reducing regulatory arbitrage and enhancing supervisory convergence across the EU. They are addressed to competent authorities responsible for TCB authorisation and, indirectly, to applicant head undertakings established in third countries.

We cover this update in our CRD6 Manager product. See more details of that here: CRD6 Manager | Simmons & Simmons

Impact on firms

While the draft Guidelines are primarily directed at competent authorities, they will have a significant impact on third country banking groups seeking to establish or maintain branches in the EU. Firms should familiarise themselves with the new information requirements, assessment methodology, and procedural steps, as these will shape the authorisation process for TCBs from 11 January 2027.

The new harmonised framework will need to be complied with by any TCB, regardless of the national applicable legislation. However, if they choose to, Member States can apply to TCBs the same requirements applicable to credit institutions, i.e. they can treat TCBs like subsidiaries of the head undertaking ('subsidiary-like approach') - so there may be higher standards in some Member States.

It also is important to note that the new framework will apply to both existing and new TCBs. Firms with existing TCBs will need to uplift their compliance to the new minimum standards set out in Articles 48e - 48h of CRD6 (i.e. the capital endowment requirement, the liquidity requirements, the internal governance and risk management requirements and the booking requirements) (see Art 48c(6) of CRD6) by 11 January 2027 in order to retain their TCBs' licences. Please see links to our Insights articles on the draft EBA guidance on these requirements below. Annexes II and III of the draft Guidelines usefully contain a standard letter for the submission of the application and a template for the submission of the information included in the application. Existing TCBs may want to look at these Annexes as a useful reference point for the harmonised requirements.

Executive Summary

The draft Guidelines are structured into three main parts:

1. Information requirements for authorisation applications;

2. Assessment methodology; and

3. Procedural elements.

The Annexes contain I) a standard letter for the request of the non-opposition statement to the third country competent authority; II) a standard letter for the submission of the application; III) a template for the submission of the information included in the application.

Key provisions of the draft Guidelines

• Scope and application: The Guidelines apply to all TCBs subject to the new CRD6 regime, except where Member States apply a "subsidiary-like" approach (i.e., treating TCBs as if they were credit institutions).
• Previous applications: When submitting information, head undertakings may be able to rely on information previously provided for existing TCBs. The Guidelines set out the information reliability criteria and if these are met, national authorities may exempt applicants from resubmitting this information.
• Information requirements: Applications must be comprehensive, covering both the applicant head undertaking and the proposed TCB's operations, governance, and prudential arrangements.
• Statement of non-opposition: A key requirement is a statement from the third country competent authority confirming no objection to the establishment of the TCB and confirming the good standing of the head undertaking.
• Business plan and financial forecasts: These must be provided on both a base case and stress scenario basis for a three-year horizon, excluding activities based on reverse solicitation.
• Internal governance: The application must include the identity of at least two persons who will effectively direct the TCB, with suitability assessments required.
• Capital and liquidity: There are detailed requirements for capital endowment and liquidity, including escrow arrangements and ongoing compliance mechanisms.
• Booking arrangements: Policies must ensure all assets and liabilities originated or booked by the TCB are properly recorded and managed locally.
• AML/CFT: Enhanced focus on AML/CFT risk assessment, governance, and consultation with relevant authorities.
• Substance requirements: TCBs must not be empty shells used only to originate assets/liabilities for booking elsewhere in the group. TCBs must record and manage all assets and liabilities originated or booked in the Member State autonomously. Competent authorities should ensure the TCB policies do not systematically or substantially rely on back-to-back hedging or intragroup risk transfers.
• Intragroup funding: Competent authorities are required to ensure that cross-border intragroup funding arrangements comply with Article 48c(4)(d) CRD6 and must check these arrangements do not disguise unauthorised cross-border business activities.
• Reverse solicitation: Competent authorities should ensure that financial forecasts of TCBs do not rely on cross-border activities provided on a reverse solicitation basis.

More detail on the draft Guidelines

1. Information requirements for authorisation applications

The Guidelines contain a detailed list of information to be provided by the applicant head undertaking, including:

• The identity and structure of the head undertaking and its group;
• The identity of the members of the management body in management function of (i) the applicant head undertaking, including the member(s) who is the ultimate reporting line about the TCB, and (ii) the intermediate and ultimate parent undertaking, where applicable;
• Audited financial statements of the head undertaking;
• The programme of operations of the TCB (3 year business plan, capital endowment, liquidity requirements, internal governance, booking arrangements, and reporting);
• Confirmation of authorisation and supervision in the home jurisdiction;
• A statement of non-opposition from the third country competent authority;
• A legal opinion on the absence of legal impediments to compliance with EU and national law; and
• The AML/CFT arrangements and risk assessment.

An applicant head undertaking can be exempt from providing this information where the relevant information has not materially changed since a previous application made in a different Member State, subject to certain conditions.

2. Assessment methodology

Competent authorities must:

• Review the completeness, accuracy, and reliability of the information provided;
• Assess the TCB's classification (Class 1 or Class 2) based on risk profile and quantitative thresholds;
• Take the necessary steps to gain a full understating of the statement of non-opposition by the third country competent authority submitted in the application;
• Evaluate the business plan (including envisaged products/services, target market and value proposition), financial forecasts (including reviewing product pricing) and internal governance arrangements of the TCB;
• Be satisfied that the head undertaking is capable of financing the operations of the TCB and maintaining a sound financial structure;
• Be satisfied that there is no reasonable ground to conclude that the head undertaking is likely to face financial difficulties and breach the applicable prudential requirements within the following 12 months;
• Scrutinise the minimum capital endowment and liquidity arrangements (based on the business plan), including the eligibility of instruments and liquidity of assets;
• Review booking arrangements to prevent "empty shell" structures and ensure local substance of the TCB; and
• Consult with AML/CFT authorities and assess AML/CFT compliance.

3. Procedural elements

Competent authorities should:

• Have a clear process for submission, acknowledgement, and assessment of applications (including requesting any missing information);
• Meet certain timelines. Assessments are to be completed within 6 months of a complete application, and in any case within 12 months of initial submission;
• Be able to rely on information submitted in prior authorisation procedures, subject to reliability criteria;
• Consult with and exchange information with third country competent authorities and the AML/CFT competent regulator; and
• Use the a standard letter for the request of the non-opposition statement to the third country competent authority.

Consultation questions

The EBA seeks feedback on:

1. The coverage of the statement of non-opposition by third country authorities;

2. The information requested on the programme of operations;

3. The circumstances under which information from prior authorisation procedures can be relied upon; and

4. The clarity and flexibility of the procedural elements.

Next steps

Following the consultation, the EBA will finalise the Guidelines, which will apply from 11 January 2027. Competent authorities must report compliance within two months of publication of the final Guidelines. The final Guidelines have to be issued by 10 July 2026.