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New version applies from 02/06/2016 — introduced by Commission Delegated Regulation (EU) 2016/861. 4 provisions change. Article 3 changes in this version: compare with the current text.

Article 3 - Qualitative criteria

Article 3
Qualitative criteria

Staff shall be deemed to have a material impact on an institution's risk profile where any of the following qualitative criteria are met:

((1))

the staff member is a member of the management body in its management function;

((2))

the staff member is a member of the management body in its supervisory function;

((3))

the staff member is a member of the senior management;

((4))

the staff member is responsible and accountable to the management body for the activities of the independent risk management function, compliance function or internal audit function;

((5))

the staff member has overall responsibility for risk management within a business unit as defined in Article 142(1)(3) of Regulation (EU) No 575/2013 which has had internal capital distributed to it in accordance with Article 73 of Directive 2013/36/EU that represents at least 2 % of the internal capital of the institution (a ‘material business unit’);

((6))

the staff member heads a material business unit;

((7))

the staff member has managerial responsibility in one of the functions referred to in point (4) or in a material business unit and reports directly to a staff member identified pursuant to point (4) or (5);

((8))

the staff member has managerial responsibility in a material business unit and reports directly to the staff member who heads that unit;

((9))

the staff member heads a function responsible for legal affairs, finance including taxation and budgeting, human resources, remuneration policy, information technology, or economic analysis;

((10))

the staff member is responsible for, or is a member of, a committee responsible for the management of a risk category provided for in Articles 79 to 87 of Directive 2013/36/EU other than credit risk and market risk;

((11))

with regard to credit risk exposures of a nominal amount per transaction which represents 0.5 % of the institution's Common Equity Tier 1 capital and is at least EUR 5 million, the staff member:

((a))

is responsible for initiating credit proposals, or structuring credit products, which can result in such credit risk exposures; or

((b))

has authority to take, approve or veto a decision on such credit risk exposures; or

((c))

is a member of a committee which has authority to take the decisions referred to in point (a) or (b);

((12))

in relation to an institution to which the derogation for small trading book business provided for in Article 94 of Regulation (EU) No 575/2013 does not apply, the staff member:

((a))

has authority to take, approve or veto a decision on transactions on the trading book which in aggregate meet one of the following thresholds:

((i))

where the standardised approach is used, an own funds requirement for market risks which represents 0.5 % or more of the institution's Common Equity Tier 1 capital; or

((ii))

where an internal model-based approach is approved for regulatory purposes, 5 % or more of the institution's internal value-at-risk limit for trading book exposures at a 99th percentile (one-tailed confidence interval); or

((b))

is a member of a committee which has authority to take decisions set out in point (a);

((13))

the staff member has managerial responsibility for a group of staff members who have individual authorities to commit the institution to transactions and either of the following conditions is met:

((a))

the sum of those authorities equals or exceeds a threshold set out in point 11(a), point 11(b) or point 12(a)(i);

((b))

where an internal model-based approach is approved for regulatory purposes those authorities amount to 5 % or more of the institution's internal value-at-risk limit for trading book exposures at a 99th percentile (one-tailed confidence interval). Where the institution does not calculate a value-at-risk at the level of that staff member the value-at-risk limits of staff under the management of this staff member shall be added up;

((14))

with regard to decisions to approve or veto the introduction of new products, the staff member:

((a))

has the authority to take such decisions; or

((b))

is a member of a committee which has authority to take such decisions;

((15))

the staff member has managerial responsibility for a staff member who meets one of the criteria set out in points (1) to (14).

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