Applicability of the prior permission requirement under Article 26(3) CRR to investment firms subject to Regulation (EU) 2019/2033 (IFR)

Article 26(3) CRR provides that institutions shall classify issuances of capital instruments as Common Equity Tier 1 (CET1) instruments only with the prior permission of the competent authorities. Article 2(5) CRR requires competent authorities to treat as "institutions", for the purposes of the CRR, only those investment firms to which Article 1(2) or 1(5) IFR applies (Class 1 firms). Investment firms subject to the IFR (Class 2 and Class 3 firms) apply the definition of CET1 capital by virtue of Article 9(1)(i) IFR, which refers to Part Two, Title I, Chapter 2 of the CRR. Do Class 2 and Class 3 investment firms require prior permission from their competent authority under Article 26(3) CRR in order to classify issuances of capital instruments as CET1 instruments?

The IFR deals expressly with several permission mechanisms of the CRR when incorporating CRR concepts. Neither Article 26(3) nor Article 26(2) CRR is mentioned in, or reproduced by, the IFR. Commission Implementing Regulation (EU) 2021/2284 confirms that consent and permission elements within Article 26 CRR operate within the IFR regime. The instructions to template I 01.00 and I 01.01 cite Article 26(2) CRR, including its requirement of prior consent, as the legal basis for the row on profit eligible (row 0080). No textual basis exists for distinguishing Article 26(3) from Article 26(2) in this respect; both are components of the same Article.