Identification of Material Risk Takers in branches of a Member State institution, where the branch is established in another Member State

In accordance with Articles 92(1) and 109 of Directive 2013/36/EU institutions must comply with all requirements of Articles 92(2), 93, 94, 95 and 96 of that Directive, including the applicable Regulatory Technical Standards regarding remuneration, at consolidated level, sub-consolidated level (in both cases including subsidiaries and also including branches of all the legal entities falling within the respective scope of consolidation,  i. e. including their branches established in third countries) and individual level (including all the branches of  the institution which has to comply with the requirements on individual level). This also covers the process of identifying material risk takers on all these three levels of application of the remuneration requirements mentioned above. Since a branch forms an integral legally fully dependent part of an institution (see definition in Article 4(1) point 17 of Regulation (EU) No 575/2013) it is principally not subject “on individual level” to specific rules or requirements of Directive 2013/36/EU and the derived Regulatory Technical Standards. Instead, the institution the branch belongs to is addressee of the requirement to conduct the identification process on an individual basis (according to Article 109(1) of Directive 2013/36/EU), which also captures the branch as a dependent part and therefore no separate legal entity. Consequently in case an institution is subject to Directive 2013/36/EU the provision to conduct the identification process on an individual basis applies always to the institution itself and has to comprise inter alia all its branches, whether they are located in a Member State of the European Union or in a third country. Thus, where an institution located in a Member State has established a branch in another Member State, that branch should be treated as a business unit of the institution. The provisions of Commission Delegated Regulation (EU) No. 604/2014 apply to institutions, including all their branches. Branches are themselves not addressees of this RTS.  Similarly, in relation to an institution established in a Member State, which has a branch established in a third country, that branch will not need to identify its material risk takers on an individual basis, and should be treated as a business unit of the institution.