1. Competent authorities may only allow the application of method 3 as referred to in Annex I to Directive 2002/87/EC in either of the following circumstances:
it is not reasonably feasible to apply either method 1 as referred to in Annex I to Directive 2002/87/EC to all entities or method 2 as referred to in Annex I to Directive 2002/87/EC to all entities within a financial conglomerate, in particular because method 1 cannot be used for one or more entities because they are outside the scope of consolidation, or because a regulated entity is established in a third country and it is not possible to obtain sufficient information to apply one of the methods to that entity;
the entities which would apply one of the methods are collectively of negligible interest with respect to the objectives of supervision of regulated entities in a financial conglomerate.
2. Either method 1 or method 2 shall be used by all regulated entities in a financial conglomerate which are not referred to in paragraph 1.
3. The application of method 3 allowed by a competent authority in relation to a financial conglomerate shall be consistent over time.