Recital 5

(5)In particular, in order to determine whether full or proportional consolidation is needed pursuant to Article 18(8) of Regulation (EU) No 575/2013 in the case of subsidiaries or undertakings in which an institution holds a participation where that subsidiary or undertaking is not an institution, financial institution or ancillary services undertaking, and where there is a substantial step-in risk and provided that the undertaking is not an insurance or reinsurance undertaking, or an insurance holding undertaking, among others, competent authorities should be expected to scrutinise, at a minimum, certain categories of undertakings such as special purpose entities that do not qualify as securitisation special purpose entities as defined in Article 2, point (2), of Regulation (EU) 2017/2402 of the European Parliament and of the Council ⁶ , for which the conditions for the transfer of significant credit risk set out in Article 244 of Regulation (EU) No 575/2013 are applicable, as well as those undertakings performing any of the activities referred to in Article 89(1), point (b), of Regulation (EU) No 575/2013.