Reverse solicitation

The reverse solicitation is where a client or counterparty approaches an undertaking established in a third country at its own exclusive initiative for the provision of banking services, including their continuation, or banking services closely related to those originally solicited.   A TCB is often invited with an invitation letter sent by one or several commercial banks or investment banks (known as arrangers) in different Member States, to provide loans together with a group of lenders domiciled in various Member States for a borrower or a borrower group that might operate in several Member States. The TCB as a lender does not have direct contact with the borrower. The invitation letter is sent by the arranger bank to invite the TCB to provide a portion of the loan for the borrower. Is the invitation letter sent by the arranger a sufficient supporting document to evidence that a client approaches us through an arranger at its own exclusive initiative? If not, is an independent statement from the borrower to certify that it has approached the TCB through an arranger adequate?

The authorisation provides that the third-country branch may only conduct the authorised activities within the Member State where it is established and expressly prohibits the third-country branch from offering or conducting those activities in other Member States on a cross-border basis, except for intragroup funding transactions concluded with other third-country branches of the same head undertaking and for transactions entered into on the basis of reverse solicitation of services in accordance with Article 21c.  Many TCBs have provided loans arranged by one or several banks for the conglomerates that operate in one or several Member States. These arranger banks have been engaged directly by the clients to organise a loan for them. The TCBs have been approached directly by the arranger banks but not by the clients.  Therefore, there is no direct contact between the TCBs as lenders and the clients as borrowers.